India’s sugar output estimated at 30 million tonne, after diversion for ethanol

India’s annual consumption is approximately 28.5 mt | Photo Credit: iStockphoto

The Indian Food Ministry has estimated India’s gross sugar production for the current season, which began on October 1, at 34 million tonne (mt), which is lower than the nearly 35 mt estimated by the industry body, the Indian Sugar and Bio-energy Manufacturers Association (ISMA).

The government is taking a cautious approach to permitting exports, weighed down by the lower-than-expected output, increased diversion toward ethanol, concerns over the next sugarcane crop, and a delayed start of sugar factories.

“There is no hurry, and sugar prices are stable despite Dussehra and Diwali being celebrated in the same month,” an official source said. The source added that based on last year’s experience, a cautious approach is necessary over October-December production, as there are fears of a likely drop in sugarcane yield and recovery rate in some States. The official said the net sugar output may be about 30 mt.

USDA’s projections

While this year’s gross production will exceed last year’s 29.5 mt, the closing stock on September 30 stood at 4.9 mt, down from 7.9 mt a year ago, official sources said. If sucrose diversion towards ethanol rises to 4 mt this year (from 3.5 mt last season), the net sugar production in 2025-26 (October-September) could be 30 mt, against an estimated 26 mt in 2024-25. India’s annual consumption is approximately 28.5 mt.

In contrast, the USDA has predicted a jump of over 25 per cent in India’s sugar output, reaching 35.3 mt during 2025-26 from 28 mt in the previous season, citing favourable weather and increased area. The Food Ministry is awaiting an updated sugarcane production estimate from the Agriculture Ministry, expected in early November.

An industry expert supported the government’s caution, stating, “The government would not like to take another risk next year as closing stock dropped to below 5 mt and more diversion to ethanol is expected.” The expert said that a decision on exports is premature, as the next three to four months are crucial for monitoring the crop against weather and pests. If government estimates are reliable, the exportable surplus would be a maximum of 1.5 mt.

Global surplus in India

Hopes for better production were based on higher sugarcane acreage in Maharashtra and Karnataka, compensating for a drop in Uttar Pradesh. However, heavy rain has caused waterlogging in Maharashtra, potentially affecting around 10 mt of sugarcane, with the Maharashtra State Cooperative Sugar Mills Association revising the estimated yield per hectare down from 82 tonne to 74 tonne.

Despite this, millers still project that about 120 mt of sugarcane will be available for crushing this year, up from 85 mt last year.

Although the government had requested an early October start for factories due to expected higher output, most mills will only begin crushing operations in November, sources said.

Claudiu Covrig of Covrig Analytics recently said the Indian government might only permit 1.8 mt to 2 mt of sugar for exports, with a decision expected between December and February, effectively locking a global sugar surplus within India.

Published on October 13, 2025