India’s sugar production has increased by about 9% in the ongoing 2025–26 sugar season, reaching 272.31 lakh tonnes as of March 31, 2026, according to the Indian Sugar and Bio-energy Manufacturers Association. During the same period last year, production stood at 248.78 lakh tonnes, indicating improved output across major sugar-producing regions.
Despite the rise in production, the industry is facing growing financial pressure. ISMA noted that rising production costs and relatively low ex-mill sugar prices have strained the finances of sugar mills. As a result, many mills are struggling with cash flow issues, which has contributed to delays in payments to sugarcane farmers.
The association has urged the government to revise the Minimum Selling Price (MSP) of sugar, stating that the current price does not reflect the rising cost of production. ISMA believes that increasing the MSP would help improve the financial health of mills and enable them to clear farmers’ dues on time while maintaining smooth operations.
ISMA also highlighted the importance of expanding ethanol blending programmes. Diverting more sugarcane towards ethanol production could provide additional support to the sugar industry, especially amid global uncertainties and rising crude oil import costs. Higher ethanol blending is also expected to strengthen India’s energy security.
The industry body further pointed out that changes in consumption patterns are affecting the sugar market. In some areas, disruptions in LPG supply have impacted restaurants and food businesses, leading to reduced demand for sugar in certain segments.
Data from ISMA also shows that the number of operational sugar mills has declined significantly as the crushing season nears its end. By the end of March, only 56 sugar mills were still operating, compared with 95 mills during the same period last year.
Among major producing states, Uttar Pradesh reported sugar production of around 87.5 lakh tonnes, which is broadly similar to last year’s output.
ISMA emphasised that timely policy support will be essential to stabilise the sector, protect farmers’ interests, and ensure sustainable growth in India’s sugar industry.
