Sugar Price Hike Linked To Lower Output, Not Ethanol Production: Centre
The Indian government has attributed the recent rise in sugar prices to lower domestic output, festive demand, and hoarding, explicitly denying that ethanol production is the cause. To stabilize the market, the government has implemented stock limits and approved duty-free imports.
Why it matters
Sugar is a staple commodity in India, and price fluctuations significantly impact inflation and the cost of living for millions of households.
The Centre on Friday rejected claims that the recent hike in sugar prices was driven by diversions of sugar for ethanol production, saying the increase instead was due to lower-than-expected domestic output, rising festive-season demand, crop damage and hoarding.Sugar prices have risen from Rs 48.18 per kg on July 20 to Rs 55.70 per kg on August 20. To curb further increase and ensure adequate availability, the government has imposed stock limits on dealers, approved duty-free imports of raw sugar and ordered checks on sugar inventories held by mills.The Ministry of Consumer Affairs, Food and Public Distribution said it was "incorrect" to link the price rise to ethanol production.According to the ministry, the share of sugar diverted for ethanol has fallen to around 9 per cent in the 2025-26 sugar season from about 12 per cent in 2022-23.
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