India weighs sugar export approval for 2025-26 amid surplus stocks, lower ethanol diversion
India considers reopening sugar exports as lower ethanol diversion leaves mills with excess inventory for the new season.
INDIA – India is evaluating a proposal to permit sugar exports in the 2025-26 marketing year, following an unexpected rise in surplus stocks driven by lower-than-planned diversion of sugar for ethanol production.
The move comes as the industry faces high opening inventories for the season that began in October.
Union Food Secretary Sanjeev Chopra said only 3.4 million tonnes of sugar were diverted for ethanol in 2024-25, compared with the earlier projection of 4.5 million tonnes. The shortfall has contributed to higher sugar availability at the start of the current marketing cycle.
Chopra noted that sugar output for 2025-26 is estimated at 34 million tonnes, while annual domestic consumption stands at 28.5 million tonnes. “We are definitely having a surplus of sugar. We are considering allowing exports,” he said in a statement to PTI, adding that the government aims to provide industry players sufficient time to plan export operations.
A committee of ministers is expected to convene next week to deliberate on export permissions. India exported about 800,000 tonnes of sugar during the 2024-25 season, below the allocated quota of one million tonnes.
Discussing export feasibility, Chopra said global prices are currently unfavourable for refined sugar, with international rates at Rs 3,829 (US$43.16) per quintal, slightly lower than domestic ex-mill pricing of Rs 3,885 (US$43.80) per quintal. However, export parity could be achievable for raw sugar, he added.
On the industry’s request for higher ethanol diversion, Chopra questioned the need for expanded allocation when mills were unable to meet the previous quota despite relaxed regulations. “We removed all restrictions for ethanol production from molasses. But maize has got the lion’s share,” he said.
In the 2024-25 ethanol supply year, the sugar sector offered 471 crore litres of ethanol from molasses but delivered only 289 million litres. Out of the total estimated 1,048 million litres of ethanol for the period, 478 million litres (45%) were supplied from maize, 289 million litres (28%) from molasses, and 235 million litres (22%) from rice.
The Secretary reiterated that domestic consumption remains the government’s foremost priority, followed by diversion for ethanol and exports.
Final decisions regarding ethanol production volumes rest with the Ministry of Petroleum and Natural Gas, which is reviewing industry proposals.
Chopra said the government aims to balance the needs of sugar producers with broader energy and agricultural policy objectives as it assesses export options for the new season.
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