Research Report

India’s sugar output is expected to remain stable in SY2027, supported by healthy cane availability and a likely reduction in sugar diversion towards ethanol. However, rainfall trends and weather conditions will remain key monitorables during the season. Improved sugar availability is expected to moderate the upward pressure on domestic sugar prices over the near term.

• Demand-supply balance estimates – Gross sugar production in SY2026 is projected to increase by 3% to 30.6 million MT (previous year [PY]: 29.6 million MT). Net sugar production, after an estimated diversion of 3.1 million MT towards ethanol production, is likely to remain at 27.5 million MT. Based on domestic consumption of 28.3 million MT and exports of 0.7 million MT (already done), the closing sugar stock level was expected to remain at around 3.8 million MT (PY: 5.3 million) by September 2026.
• Domestic prices – Domestic sugar prices in Uttar Pradesh softened to Rs. 44/kg in September 2026 from Rs. 47/kg in the previous month, as import approval eased supply concerns.