India has doubled the permissible sugar stockholding limit to 30 days, while mandating that any additional stock beyond the prescribed limit must be sourced exclusively from imported sugar, according to Bloomberg.
The move comes as India prepares for a potentially tighter sugar supply outlook, with domestic sugar production expected to decline next season amid concerns over El Niño-induced dryness. The next crushing season is scheduled to begin next month.
The government has been taking a series of measures to improve domestic sugar availability and contain prices ahead of the festival season, including allowing duty-free imports and tightening stockholding norms for bulk users and dealers.
Sugar Imports Remain Commercially Viable
Sugar imports continue to make commercial sense despite a recent decline in domestic prices, Indian Sugar and Bio-Energy Manufacturers Association (ISMA) President Niraj Shirgaokar said on Wednesday.
“Imports are still viable despite declining domestic prices,” Shirgaokar told reporters on the sidelines of the fourth edition of The India Sugar & Bio-Energy Conference 2026. His comments come after the government last month allowed duty-free imports of 10 lakh tonnes of sugar to shore up domestic supplies and keep retail prices under check ahead of the festival season.
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Global sugar prices have firmed since then amid tightening supplies and the start of Indian purchases, raising concerns among mills about the economics of importing the sweetener. According to sources, sugar mills have so far applied to import around 8 lakh tonnes of the permitted 10 lakh tonnes.
Domestic Sugar Prices Fall Sharply
Domestic ex-mill sugar prices have declined significantly, Shirgaokar said. Prices have fallen to around Rs 43-44 a kg from a peak of Rs 65-67 a kg recorded two weeks ago. The decline in ex-mill prices is expected to take another one to two weeks to reflect in retail prices, he said.
The government has also tightened stockholding norms for bulk users and dealers as part of efforts to prevent hoarding and improve availability in the domestic market.
The latest measures come against the backdrop of a weaker production outlook for India, the world's second-largest sugar producer. Sugar output is expected to decline next season as El Niño-induced dryness threatens the harvest. The impact of weather conditions is being closely watched as mills prepare to begin crushing operations next month.
The government has already lowered its sugar production estimate for the 2025-26 marketing year, which runs from October to September, to 306 lakh tonnes from its earlier estimate of 343 lakh tonnes.
Annual domestic sugar demand is estimated at around 280-285 lakh tonnes.
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