Indian Sugar Prices Hit Record Highs Amid Supply Tightness

The domestic sugar market in India is experiencing severe supply tightness, leading to surging prices across major spot markets. Despite government measures to curb the price rally, prices have continued to make fresh record highs, with M-grade sugar quoted at ₹5,450-₹5,520 per quintal in North India and S-grade sugar reported at ₹5,200-₹5,250 per quintal in Maharashtra.

The severe supply tightness is attributed to concerns over the impact of El Niño on the upcoming sugarcane crop and declining mill inventories. The Directorate of Sugar & Vegetable Oils (DSVO) has directed sugar mills to ensure that buyers lift purchased sugar stocks within seven days of sale, warning of legal action against mills found engaging in speculative practices.

However, these measures have so far failed to ease market tightness, and prices continue to move higher. With Indian sugar now reaching import parity at zero import duty, market participants are closely watching the government's stance on sugar imports, which could help ease domestic supply tightness and moderate prices.