With wholesale sugar prices reaching record levels in India, officials are exploring a series of measures, including duty-free imports and tighter stock limits, to bolster supply and stabilise the market before peak festival demand.
India is weighing a fresh set of steps to cool record sugar prices, including allowing limited duty-free imports and tightening stockholding rules for bulk traders, according to Reuters. Officials and industry sources said the aim is to boost supply before the peak festival season, when demand for sweets typically rises across the country. Reuters also reported that authorities are considering lower stock limits, changes to the monthly sales quota for mills and possible cuts in import duties.
The issue has sharpened after wholesale sugar prices in Kolhapur, a key trading centre in Maharashtra, climbed to a record Rs 5,350 per 100 kg, up nearly 20% since the start of August. Reuters quoted a government source as saying the rise was not justified and that the authorities were looking at a broad set of tools to steady the market. A second official said domestic supplies should be sufficient to meet demand until the new season’s cane begins arriving.
The government has already moved to curb speculation. Business Standard reported that dealers have been ordered to limit holdings to 4,000 quintals, or 30 days of stock, whichever is lower, from August 1 to November 30, under the Essential Commodities Act and the Sugar (Control) Order, 2025. Moneycontrol and LiveMint also reported the same measure, saying it was intended to prevent hoarding and artificial shortages during the festive period.
Industry figures have warned that the market remains tight in some regions. The Economic Times said retail prices have hit record levels in parts of India, even as trade groups maintain that national supplies are adequate. Ashok Jain, president of the Bombay Sugar Merchants Association, told Reuters that imports were the only reliable way to lift availability and ease prices during the festival season. Reuters added that the government is also considering reducing cane diverted to ethanol production from October, which could increase sugar output in the next season.
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