Abhijit Chaliha, Guwahati: Retail sugar prices have risen sharply in recent weeks, prompting the Centre to reject claims that the increase is being driven by diversion of sugar for ethanol production. The government has instead attributed the surge to lower domestic output, festive-season demand, weather-related crop damage, tightening global supplies and alleged hoarding. According to the Ministry of Consumer Affairs, Food and Public Distribution, retail sugar prices increased from ₹48.18 per kg on July 20 to ₹55.70 per kg on August 20.
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The government said it was incorrect to blame ethanol production for the price rise. It noted that the proportion of sugar diverted for ethanol has actually declined, from around 12 per cent in 2022-23 to about 9 per cent in 2025-26. Nearly three-fourths of India’s ethanol production now comes from grains, particularly maize. Officials pointed to a fall in sugar production as a key factor. Domestic output has reportedly declined to around 306 lakh tonnes, while demand is expected to increase during the festive season. Weather-related damage to sugarcane crops and tighter global supplies have further contributed to market pressures.
The Centre has taken several steps to contain prices. It has permitted duty-free imports of one million tonnes of raw sugar until October 31, while also tightening stockholding limits for bulk consumers. From September 1, bulk users will be restricted to holding 15 days’ inventory. The government has also warned against hoarding and black marketing and said it is closely monitoring the market. With the festive season approaching, authorities face the challenge of ensuring adequate supplies while preventing further price escalation and protecting consumers from speculative increases.
