The government is expected to soon decide on a potential increase in the Minimum Selling Price (MSP) of sugar, as the sugar industry faces growing production costs.

The Union Food Minister acknowledged the demand for an MSP hike, citing the increasing cost of sugar production, mainly due to the regular rise in the Fair and Remunerative Price (FRP) of sugarcane since 2019.

While the MSP of sugar has remained unchanged since February 2019, sugar mills are experiencing economic pressures, and leading associations like the Indian Sugar and Bio Energy Manufacturers Association (ISMA) and the National Federation of Cooperative Sugar Factories (NFCSF) are pushing for an increase in the MSP to Rs 3914 and Rs 4200 per quintal, respectively.

However, the government is unlikely to approve such a significant increase right away. It may consider raising the MSP by a more modest Rs 100-200 per quintal.

With the ban on commercial sugar exports and falling domestic prices, sugar mills are struggling with substantial losses, making the issue urgent. The government is aware of the industry's financial distress and is evaluating the situation carefully before making a decision.