Key Takeaways
- Government approves export of 15 lakh tons of sugar for 2025-26 season
- ISMA welcomes move but seeks MSP revision and higher ethanol prices
- Production costs exceed current MSP, threatening farmer payments
- India maintains sufficient sugar stocks for domestic needs despite exports
The Indian Sugar and Bio-Energy Manufacturers Association (ISMA) has welcomed the government’s approval for exporting 15 lakh tons of sugar during the 2025-26 season. The association called this a timely decision that will help balance markets and support industry planning.
Ethanol Pricing Concerns
While appreciating the export permission, ISMA urged the government to address ethanol pricing issues. The current allocation of 289 crore litres represents only 27.5% of total capacity, leaving distillery operations underutilized.
The association recommended aligning ethanol allocations with NITI Aayog’s Ethanol Blended Petrol Roadmap, which targets 55% contribution from the sugar sector.
Production and Stock Position
According to ISMA’s First Advance Estimates, India’s net sugar production for 2025-26 is projected at 309.5 lakh tons after diverting 34 lakh tons for ethanol. With domestic consumption estimated at 285 lakh tons, closing stocks are expected at 74.5 lakh tons – sufficient to support exports without affecting domestic supply.
Cost Pressures and MSP Demand
ISMA highlighted that rising sugarcane costs in states like Uttar Pradesh and Karnataka have pushed production costs to approximately Rs 41.7 per kg. The Minimum Selling Price (MSP) of sugar has remained unchanged for over six years, creating financial strain on mills.
The association warned that without MSP revision, sugar mills may struggle to make timely payments to farmers.
Industry Leadership Perspective
ISMA Director General Deepak Ballani stated: “We thank the Government for its timely and progressive decision to permit sugar exports. These steps reflect a balanced approach to managing domestic and global market realities. At the same time, we urge the Government to consider revising the sugar MSP and ethanol procurement prices to ensure the financial health of the industry and timely cane payments to farmers.”
ISMA emphasized that continued policy support, including MSP increase to Rs 40-41 per kg and balanced ethanol pricing, is essential for mill viability, farmer income protection, and strengthening India’s sugar and bio-energy ecosystem.
