COMING 6 WEEKS: Centre likely to decide on sugar exports, ethanol blending & MSP

India’s Food Secretary Sanjeev Chopra has revealed that the Central Government is expected to take key policy decisions in the next month to six weeks to address concerns in the sugar sector over surplus production and the risk of rising sugarcane arrears.

Speaking to the media on the sidelines of the annual general meeting of the Indian Sugar and Bio-Energy Manufacturers Association (ISMA), Chopra indicated that the government is examining long-pending demands from the industry. These include raising the minimum selling price (MSP) of sugar from the current Rs 33 per kg to at least Rs 41 per kg, increasing the share of sugarcane diverted for ethanol production from 28 per cent to around 50 per cent, and allowing higher sugar exports beyond the existing limit of 1.5 million tonnes (mt). The sugar season runs from October to September.

The secretary maintained that at present, sugarcane arrears are not very large. However, we have been informed that over the next month and a half, arrears could start building up. Excess sugar production over domestic consumption in the 2025–26 season could then hurt farmers, which is something we want to avoid. He said that Centre will therefore do whatever is necessary to absorb the surplus.

He added that with the measures already in place, ISMA has estimated closing sugar stocks at around 6 mt by the end of the 2025–26 season. According to Chopra the government would take all possible steps to reduce stock levels further so that farmers are not adversely impacted by mounting dues.

Deepak Ballani, Director General, ISMA, said, “The most important request of the government is the revision of minimum support price of sugar. As we all know that the MSP was not revised for last six years.” As the industry has invested about Rs 40,000 crore, Ballani said that there is need for viable returns for the sugar mills to pay farmers on time.