Resale sugar prices in India fell by ₹400-500 a quintal on Friday in the key producing states of Karnataka and Maharashtra, following the government's decision to permit the import of 1 million tonnes of raw sugar, according to businessline. The decline came even as retail sugar prices climbed to a new high of ₹58.15 per kg.
Price action in Indian sugar markets
businessline reported that resale sugar refers to sugar that traders or agents had earlier purchased from factories through tenders at ₹5,500 to ₹5,800 per quintal but had not yet lifted. An industry source told businessline that there was no demand due to fears of heavy resale pressure on concerns over import of raw sugar, with GST and Food Department officials tightening monitoring and some traders indulging in profit booking.
There was no demand due to fears of heavy resale pressure on concerns over import of raw sugar. GST and Food Department officials have tightened their monitoring, while some traders indulged in profit booking. — industry source, via businessline
"After tender rates exceeded ₹6,000, traders are selling this stock below Thursday's market price following government orders on price control. They are doing this to quickly realise profits due to restrictions. Still, some mills have kept the open rate of more than ₹6,400-6,500," the source said. Prices are under pressure, and there could be a further drop of ₹100-200 from the ₹400-500 a quintal witnessed in the morning.
Retail prices soared to a new high of ₹58.15 a kg from ₹55.7 on Friday. "The drop in resale sugar prices will be reflected from tomorrow, if not from Monday," the source said, adding that State government and Food Department officials are intercepting vehicles for checks. Warehouse inspection has begun in Karnataka and an unregistered warehouse has been sealed, a milling source said, while bulk buyers are offloading their stocks in the open market after the Centre tightened stock holding norms.
Import norms and global futures
Global sugar prices also fell after the import announcement. October raw sugar futures, which surged to 18.26 cents a pound soon after the news, dipped to 17.35 cents at 1830 hours IST, and raw sugar for cash was quoted at 17.5 cents. In London, white sugar slipped to $548 a tonne from a surge to $558 on Thursday. "Global prices were not expected to sustain as they factored in Indian imports," another trade source told businessline.
Late Thursday night, the Directorate-General of Foreign Trade (DGFT) issued norms for raw sugar imports. Preference will be given to importers who undertake to bring consignments by October 15, and for every 1.05 tonnes of raw sugar imported, the holder of a tariff quota licence should produce 1 tonne of white sugar. Trade sources said nearly 4 lakh tonnes could reach Indian shores within 45 days, with 3 lakh tonnes already on the way.
The government also notified that bulk buyers using more than 10 tonnes of sugar a month cannot hold more than 15 days' stock, effective until November 30. The Ministry of Food asked all mills to furnish details of sugar sold on August 17, 18 and 19. "This is to know who has bought sugar during these days and the volume purchased. The objective is to crack the whip if it suspects someone," said Dilip S Patil, Managing Director of Samarth SSK Ltd and Co-Chairperson of the Sugar Bioenergy Forum (SBF) under the Indian Federation of Green Energy.
Supply-side adjustments
The government blamed sugar production falling short of initial estimates for the price surge. Production in the current season (October 2026-September 2027) is expected to be around 306 lakh tonnes, compared with the initial estimate of around 343 lakh tonnes by sugarcane-growing states, businessline reported. Output was affected by Red Rot and Top Borer disease in sugarcane, as well as waterlogging caused by excess rainfall. Despite the lower estimate, adequate sugar stocks are available to meet domestic demand until the new crushing season begins in October, the government said. Sugar prices are rising globally too, with the sugar deficit for 2026-27 estimated at around 33 lakh tonnes. The government denied that sugar prices have surged due to diversion for ethanol.
Key price and supply indicators
| Indicator | Value |
|---|---|
| Resale price drop (Karnataka & Maharashtra) | ₹400-500 per quintal |
| Potential further decline | ₹100-200 per quintal |
| Retail sugar price (Friday) | ₹58.15 per kg, from ₹55.7 |
| NY October raw sugar futures peak | 18.26 cents/lb |
| NY October raw sugar futures later | 17.35 cents/lb |
| Raw sugar cash quote | 17.5 cents |
| London white sugar Thursday surge | $558 per tonne |
| London white sugar after | $548 per tonne |
| Raw sugar arrivals expected | ~4 lakh tonnes within 45 days; 3 lakh tonnes on the way |
| 2026-27 production estimate | ~306 lakh tonnes vs ~343 lakh tonnes initial |
| Global sugar deficit 2026-27 | ~33 lakh tonnes |
Outlook for sugar traders
Resale sugar prices are under pressure, with a further ₹100-200 per quintal decline possible, according to an industry source. The retail-level drop is expected to be reflected from Saturday or Monday, the source said. Global futures have already factored in Indian imports, so earlier gains were not expected to hold. Traders will be monitoring the pace of raw sugar arrivals, DGFT licence conditions, and enforcement of stock holding limits ahead of the November 30 deadline.
Sources:
