India's sugar prices dip at factory gate but retail rates stay high
Ex-mill sugar prices have fallen about 20% after the government approved duty-free imports, yet retail costs remain near a 30% rise from a month ago.
Reduced sugarcane yields due to diseases and waterlogging have cut the 2025-26 production forecast to about 306 lakh metric tonnes, leaving a tighter supply cushion as households and businesses stock up for upcoming festivals. International sugar prices have risen over 16% in recent weeks, adding pressure on the domestic market. In response, the Centre authorized duty-free imports of 10 lakh tonnes of raw sugar and imposed stricter stock-holding limits, which led mills to lower ex-mill prices by nearly 20% to roughly Rs 55 per kilogram.
The National Federation of Cooperative Sugar Factories confirmed the new lower rates nationwide. However, wholesale prices sit around Rs 59-60 per kilo and retail rates hover near Rs 64 per kilo, still about 30% above a month earlier, because earlier higher-priced stock remains in the supply chain. The government is also moving to fortnightly quota allocations and faster dispatches to keep existing stocks moving, while expecting a stronger domestic crushing season from October onward.
Why it matters
Consumers face high sugar costs despite lower factory prices, affecting household budgets during the festive season.
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