Indian Sugar Industry Crisis: Sugar industry in crisis! Farmers’ bills stalled due to non-increase in sugar and ethanol rates

By Samira Vishwas On Jan 13, 2026

Financial pressure on the sugar industry
Fall in sugar prices and rise in ethanol prices
Minimum sugar tariff and additional export permit

Indian Sugar Industry Crisis: Harshvardhan Patil, President of National Cooperative Sugar Factories Federation, has asserted that the sugar industry is in a serious financial crisis during the current sugarcane harvest season in the country, and the decline in the price of sugar and the non-increase in the price of ethanol for the last three years has adversely affected the financial stability of the factories. At the beginning of the fall season, the rate of sugar was Rs 3,850 per quintal. But currently it has fallen by around Rs. 300. At the same time, due to no increase in the price of ethanol, the revenue income of the sugar mills has decreased significantly.

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As a result, it is becoming difficult for the factories to pay the sugarcane bills within 14 days to the sugarcane farmers and many of the factories have to take high loans from banks and work under the burden of interest. At present, the average cost of sugarcane production (including cutting and transportation) is over Rs 4,000 per tonne, while the average selling price of sugar is around Rs 3,600 per quintal. Due to this disparity, the payments of the farmers are stalled due to increasing financial stress. Sugarcane FRP has increased from Rs 2,750 to Rs 3,550 per tonne, i.e. by about 26 per cent, while the minimum selling price of sugar is Rs 31 per kg. Therefore, Patil explained that the minimum selling price of sugar should be Rs 41 per kg.

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He also mentioned that during February to September 2025, the price of ex-mill sugar remained at Rs 38 to 40 and the retail price was Rs 46 to 47 per kg, and these rates were accepted by the consumers without complaint. It has also been demanded that the price of ethanol should be increased and the fair price for sugarcane based ethanol should be decided. A delegation of the National Cooperative Sugar Factory Federation will soon meet Prime Minister Narendra Modi, Union Home and Cooperatives Minister Amit Shah and Union Food Minister Prahlad Joshi for all these demands. Representatives from major sugar producing states like Maharashtra, Gujarat, Karnataka and Uttar Pradesh will participate in this delegation. 15 lakhs by the central government. Tons of sugar has been allowed to be exported, and considering the additional reserves in the country, another 5 lakh may be allowed. A demand has also been made on behalf of the Federation that by allowing the export of tonnes of sugar, it should be done through NCEL.