Sugar Prices Likely to Remain Strong as Free Sale Quota is Fixed Amid Lower Production

30-Apr-2025 08:32 PM

New Delhi. With sugarcane crushing and sugar production nearly completed across the country, early estimates suggest a sharp decline of around 60 lakh tonnes in sugar output for the 2024–25 season compared to the previous year. As a result, the carryover stock with the industry is expected to fall below 50 lakh tonnes by the end of the marketing season on September 30, 2025.

To manage domestic supply, the Food Ministry has fixed the monthly free sale quota for May 2025 at 23.50 lakh tonnes, the same as April’s quota but 3.50 lakh tonnes lower than the 27 lakh tonnes released in May 2024. With industrial demand set to rise in summer, particularly from beverage and confectionery sectors, sugar prices are likely to remain strong in the coming weeks.

The decline in sugar production has been most significant in Maharashtra and Karnataka, with Uttar Pradesh also recording a dip. Except for a few states, production has reduced across all major sugar-producing regions, tightening overall supply.

Although the government has permitted the export of 10 lakh tonnes of sugar for the 2024–25 season, the pace of exports remains slow.

High domestic prices are discouraging millers from diverting sugar for exports, as they are fetching better returns in the local market.

Between January and May 2025, the government released a total free sale quota of 115 lakh tonnes, which is 5.50 lakh tonnes less than the same period in 2024, but 4 lakh tonnes higher than in 2023.

While crushing operations have concluded in most parts of the country, a few units in Uttar Pradesh are still active.