Amid a recent rise in sugar prices, the Centre has tightened its monitoring of sugar supplies and announced a new quota system for sugar mills. From September 2026, sugar mills will receive sales quotas every 15 days instead of getting a monthly allocation. The move is aimed at ensuring adequate availability of sugar in the market and preventing situations of artificial shortages or hoarding. The government has also made it clear that there is no shortage of sugar in the country.
At present, the Ministry of Food allocates sugar sales quotas to mills for an entire month. However, during a recent stock assessment, the government found that some mills were holding more sugar than the quantity they had declared, while some others had sold less than their allocated quota. According to the ministry, in some cases, sugar sold at the beginning of the month was lifted by buyers only towards the end of the month. This led to a temporary reduction in sugar availability in the market. The government has now decided to make the quota system more frequent to ensure a smoother flow of sugar from mills to the market.
Sugar quota to be allocated every 15 days
Under the new system, mills will receive their sales quota on a fortnightly basis from September. Mills will be required to sell at least 40 per cent of their allocated quantity during the first week, while the remaining quantity will have to be sold in the following week.
In another key requirement, sugar sold by a mill must be dispatched within seven days of the sale. The government expects the new system to speed up the supply chain and improve the availability of sugar in the market. More frequent monitoring is also expected to help authorities identify any unusual stock build-up or supply disruptions more quickly.
Sugar prices have started easing
The government said ex-mill sugar prices have fallen by around 20 per cent over the past few days, while retail prices have also started showing signs of moderation. According to the government, if supplies remain normal, retail sugar prices could decline further in the coming days. The latest measures are aimed at keeping supplies steady and preventing sudden price pressures ahead of the festive season. To help control inflation, the Centre has also allowed the import of 10 lakh tonnes of raw sugar until October 31. In addition, stock limits have been imposed on dealers and large buyers. Sugar exports are already restricted.
Festive season to see stronger sugar supplies
The government is also preparing for higher sugar availability ahead of the festive season. Crushing of sugarcane for the new marketing year, which begins in October, is scheduled to start from October 15. Sugar production in October is estimated to exceed 10 lakh tonnes, while production is expected to reach around 45 lakh tonnes in November. The expected increase in domestic production, along with the measures taken to improve supply and imports of raw sugar, could provide additional support to the market during the high-demand festive period.
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