India sugar prices jumped 10% as analysts lowered the 2026‑27 output forecast to 27‑29.5 million tonnes from 31 million tonnes last year— a sharp 9‑10% drop that has rattled the market.
Below‑normal monsoon clouds over Maharashtra and Karnataka have pushed yield estimates there down 14‑19%, tightening the supply‑demand balance and pushing prices higher.
Early crushing is underway: 40‑50 mills began grinding on October 15, roughly 20‑25 days ahead of the usual November start, potentially easing near‑term pressure if cane availability holds.
The government has rolled out an emergency import allocation of 1 lakh tonnes and maintained stock limits until November 30, hoping to dampen price spikes while the supply chain stabilises.
Global risks echo India’s woes: Thailand’s output is expected to drop 17% and the EU 19%, while Brazil’s rains threaten a similar decline— a scenario that could keep worldwide prices buoyed.
Meanwhile, the ethanol procurement rule—excluding sugar‑cane‑based feedstocks from the 1,100‑crore‑litre 2026‑27 tender— forces mills to re‑weight their sugar‑cane allocation between sugar production and ethanol, adding another layer of uncertainty.
Looking ahead, traders will keep a close eye on the next month’s crushing figures and any shifts in the government’s import and stock‑limit policy to gauge whether the 10% jump is a correction or a new trend.