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Sugar stocks surge after government tightens stockholding rules
New limits let wholesalers holding more than 10 metric tonnes keep inventory for up to 15 days from September to November as record high prices run above ₹6,000 per quintal in some markets.
Indian sugar stocks rallied up to about 6% on August 20 after the government tightened sugar stockholding limits amid record-high domestic prices ahead of the festive season, according to LiveMint Markets citing Reuters. Bajaj Hindusthan rose 5.3%, Dhampur Sugar gained 6%, Dwarikesh Sugar Industries jumped 6.3%, Shree Renuka Sugars advanced 4%, and Balrampur Chini Mills climbed 3%.
Under the revised rules, dealers buying more than 10 metric tonnes of sugar per month can hold inventory for up to 15 days. The restrictions run from September 1 to November 30, with the government monitoring monthly sugar sales.
Wholesale sugar prices have moved higher across regions, with markets such as Kanpur and Kolkata crossing ₹6,000 per quintal and the Muzzafarpur and Kolhapur belts averaging above ₹5,000 per quintal, LiveMint Markets reported. The all-India average ex-mill sugar price rose to ₹5,400–5,500 per quintal from ₹3,900 a year earlier, while retail prices increased 13% year-on-year to ₹52.30 per kg as of August 18.
The tighter norms come as concerns grow about sugar availability for the 2026-27 season starting October 1, with estimates for opening stocks ranging from 32–35 lakh tonnes to 40–42 lakh tonnes against domestic requirements of about 50 lakh tonnes. LiveMint Markets also cited SBI Securities research head Sunny Agrawal, who said the demand-supply tightness has helped lift sugar prices and could support mills’ margins, including in ethanol, where prices have been unchanged for three years.
Latest closeSugar $16.60 ▼1.3%