India's sugar production for the 2025-26 season has seen a significant increase, reaching 274.8 lakh tonnes by April 15. This marks an 8% rise from the 254.96 lakh tonnes produced during the same period last year. The crushing season is nearing its end, with only 19 mills still operational across the country, a notable drop from 38 last year.
State-Level Production Trends
Data from the Indian Sugar & Bio-Energy Manufacturers Association reveals varied performance across states. Uttar Pradesh, a major sugar-producing state, experienced a slight dip in output, recording 89.26 lakh tonnes compared to 91.10 lakh tonnes last year, with only six mills continuing operations.
In contrast, Maharashtra and Karnataka have been key drivers of this season's growth. Maharashtra produced 99.3 lakh tonnes, and Karnataka contributed 48.10 lakh tonnes, both showing substantial year-on-year increases. Both states have already concluded their crushing seasons. Tamil Nadu continues with limited operations, reporting a marginally higher output of 5.25 lakh tonnes.
Industry Flags Policy Gaps and Financial Strain
While the increased production ensures comfortable availability, the Indian sugar industry is grappling with severe financial pressures. Rising operational costs coupled with weak ex-mill prices are straining cash flows and delaying crucial payments to farmers. The sector is urgently appealing to the government for an early revision of the Minimum Selling Price (MSP) to better align with current cost structures.
Ethanol Blending and Procurement Challenges
Beyond sugar production, the industry is also advocating for accelerated progress in ethanol blending, urging the government to expand targets beyond the current E20 mandate, especially amidst escalating crude oil prices. However, this initiative faces hurdles due to stagnant ethanol procurement prices and reduced allocations, which have led to underutilised capacity and an accumulation of inventory. Furthermore, disruptions in LPG supply have compounded these challenges, impacting ethanol consumption and adding to the sector's woes.