Sugar output jumps 25% in 2025, industry seeks sugar price revision

All-India sugar production has reached 118.97 lakh tonnes (as on 31 December 2025) marking a healthy growth of nearly 25% over the 95.40 lakh tonnes produced during the corresponding period last year.

Ample sugarcane availability, improved on-ground productivity, and enhanced operational efficiency across key producing states have contributed to the strong start of the season, Indian Sugar & Bio-Energy Manufacturers Association (ISMA), the apex industry body representing private and public sector sugar and bio-energy producers in India, said.

The industry has also seen a marginal rise in active participation with 504 sugar mills currently in operation, compared to 492 mills at the same point in the previous season.

According to ISMA data, Uttar Pradesh has produced 35.86 lakh tonnes of sugar, registering an increase of 3.06 lakh tonnes (+9%) over last year by the end of December. Maharashtra has delivered an exceptional performance maintaining a higher crush rate, with sugar production reaching 48.61 lakh tonnes, reflecting a remarkable increase of around 62% over the corresponding period last season. The state currently has 197 mills in operation, against 190 mills which were in operation on the corresponding date. Karnataka has also reported accelerated crushing activity, with sugar production rising by around 12% compared to the same period last year.

ISMA says that despite the positive production outlook, certain structural challenges including low Minimum Selling Price (MSP) need urgent resolution to sustain sectoral health. “Ex-mill sugar prices in major producing states have declined significantly and are currently below the cost of production, averaging around Rs 3,600 per quintal in Maharashtra and Karnataka. An immediate revision of the MSP of sugar, aligned with rising production costs, is essential to restore financial viability, ensure timely cane payments to farmers, and stabilise the market—without imposing any additional fiscal burden on the Government”, the association said.

The sugar industry has also been complaining that the reduced ethanol allocations and the non-revision of ethanol procurement prices since 2022–23 have constrained distilleries’ ability to operate at optimal capacity, leading to operational inefficiencies and liquidity stress. “A calibrated and forward-looking policy framework is required—one that aligns ethanol prices with increasing cane costs, ensures parity in ethanol allocations across sugarcane-based feedstocks, and provides a clear roadmap beyond the E20 blending programme”, it has often proposed.

“Addressing these issues through timely policy interventions will enable the sector to fully leverage its installed capacity, ensure financial stability, safeguard farmer interests, stabilise sugar markets, and continue contributing significantly to India’s energy security and rural economic growth”, ISMA said.