Retail sugar prices in some Indian markets have reached 75 rupees ($0.79) per kilogramme, up from 40 rupees in September 2025, raising the cost of sweets ahead of the country’s festival season. For Jai Krishan, a labourer from Bihar working in Srinagar, the increase could mean cutting back on clothes and toys so he can maintain his tradition of taking Diwali sweets home to his family.
Why sugar supplies have tightened
Government data attributes the lower production outlook mainly to reduced sugarcane cultivation and lower rainfall during the El Nino weather pattern. The government has also accused hoarders of holding extra sugar after the effects of El Nino became clear, tightening supplies in pursuit of higher profits. Related coverage: Why Tarique Rahman’s first India trip has been put on hold.
Farmers describe a broader set of pressures. Mukesh Chandra, a sugarcane farmer in Punjab, cited the shift to other crops, high labour costs and low returns. He estimates that producing 100kg of sugar costs about 470 rupees, compared with returns of about 416 rupees.
In Uttar Pradesh, farmer Suresh Pal said the Co-0238 sugarcane variety has become more vulnerable to red rot fungus and pests. He also pointed to soil degradation, heavy water use, rising input costs and delayed payments from sugar mills.
Key points
- India is expected to produce about 30.6 million tonnes of sugar in the season ending September 2026, below an earlier government estimate of 34.3 million tonnes.
- The country consumes between 29 million and 32 million tonnes of sugar each year, about 15 percent of global consumption.
- Traditional Indian sweets can contain 30 to 60 percent sugar by weight.
- The sweets sector is worth more than $1.1bn, with festive sales accounting for more than 40 percent of annual revenue.
A dispute over ethanol and the government response
Chandra also blamed the diversion of sugarcane to ethanol production for reducing sugar supplies. The government disputes that explanation, saying the share of sugar diverted to ethanol fell from about 12 percent in 2022-23 to about 9 percent in 2025-26. It says nearly three-quarters of India’s ethanol is now made from grains such as maize. Read the context: Youth-driven Cockroach movement demands freedom for students detained during protests in India.
The government authorised duty-free imports of one million tonnes of raw sugar, with a cap on rates, to ease supply pressure. Delhi University economics professor Sanjay Kumar said the measure acts mainly as a ceiling on prices because imported sugar is available at about $0.55 per kilogramme, but he noted that Indian consumers primarily demand refined sugar rather than raw sugar.
Families adjust before the festival season
India’s festival calendar begins in late August with celebrations including Ganesh Chaturthi and Onam, then intensifies in October and November with Navratri, Durga Puja, Dussehra and Diwali. Sweets are also used for weddings, religious occasions and prasad, the offerings shared during rituals.
Aman Jaswal, a resident of Patna, said sweets were costing 15 to 20 percent more this year. Krishan, who has saved 15,000 rupees to travel home in November, said he is walking about eight kilometres to work to save 50 rupees a day for his family’s celebrations.
What happens next
The government’s duty-free import authorisation covers one million tonnes of raw sugar until October 31, 2026, with the stated aim of easing supply pressure ahead of the festival season.
No comments yet. Start the discussion.