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India produces 77.9 lakh tonnes of sugar; Mills push for higher selling price

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The National Federation of Cooperative Sugar Factories Ltd. (NFCSF) reports that India's sugar production increased by 28.33% to 77.90 lakh tonnes in the first few months of the 2025–26 season. Cooperative mills are pushing the government to raise the minimum selling price (MSP) despite the high output because of declining market rates and growing production costs that jeopardise farmers' timely payments.

As of December 15, 900.75 lakh tonnes of cane had been crushed by 479 active sugar mills, a 25.6% increase from 473 mills and 718.6 lakh tonnes of cane the previous year. Ex-mill sugar prices have dropped nearly Rs 2,300 per tonne since the season began and currently hover around Rs 37,700 per tonne.

State-wise production shows Maharashtra, India’s top sugar-producing state, more than doubling output to 31.30 lakh tonnes from 16.80 lakh tonnes a year ago. Uttar Pradesh produced 25.05 lakh tonnes, up from 22.95 lakh tonnes, while Karnataka’s output rose to 15.50 lakh tonnes from 13.50 lakh tonnes.

The federation has urged the government to increase the MSP to Rs 41 per kg and allow the diversion of an extra 5 lakh tonnes of sugar for the production of ethanol, which it believes could bring in about Rs 20 billion. While NFCSF welcomed the government’s approval for 15 lakh tonnes of sugar exports this season, it warned that this measure alone would not solve the liquidity issues facing mills.

According to NFCSF, mills owe more than Rs 1.30 lakh crore for cane payments, and excess inventory could tie up almost Rs 28,000 crore in working capital. In order to stabilise the industry and protect farmers' payments, the federation has sent comprehensive proposals to Prime Minister Narendra Modi and the Union Food Minister.

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