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India cuts sugar dealer holding limit, sugar stocks slide

The government halved dealers' stock limit to 2,000 quintals, citing a need to curb hoarding as retail inflation rose to 4.5% in July.

Reported · Written up by our desk · Trade & Tariffs

India’s central government cut sugar dealers’ stock-holding limit by 50%, from 4,000 quintals to 2,000 quintals, and that policy change pushed sugar stocks lower across the market, according to LiveMint Markets. The new limit applies “at anytime, anywhere in the country” for the period from 15 September to 30 November, and dealers cannot hold any stock for more than 30 days from the date of receipt. LiveMint Markets reported that Dwarikesh Sugar fell 6.2% to ₹49.19, Ponni Sugars dropped 6.1% to ₹378.80, and multiple other listed sugar-related names each declined more than 5% on the day, based on BSE data. The government said the move is intended to ensure adequate sugar availability in the domestic market and to check hoarding and speculative trading, as noted by the food ministry. Dealers in Kolkata and its extended metropolitan areas were exempted from the lower 2,000 quintals limit due to what the ministry described as “specific market requirements of the region.” The sector selloff came while broader Indian benchmarks were also down, with the Sensex down 0.3% and the Nifty off 0.4%. LiveMint Markets linked the policy to rising retail inflation, citing that India’s retail inflation accelerated to 4.5% in July and that sugar and confectionery carry a 1.36% weight in the Consumer Price Index.

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Latest closeSugar $18.38 ▲3.2%|Sensex 76,957.27 ▲0.0%

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