Sugar prices surge on low cane output, trader stockpiling

Sugar prices have surged to Rs 75-80 per kilogram in parts of Maharashtra, with experts attributing the spike to multiple interrelated factors. A supermarket owner in Chhatrapati Sambhajinagar reported the elevated rates on Sunday, reflecting a broader market trend across the country.

Industry analysts have ruled out diversion of sugar towards ethanol production as a primary driver of the price increase, despite opposition parties blaming the government's ethanol blending policy for inflating costs. The Centre has rejected these allegations, countering that the industry itself bears responsibility for the price surge despite adequate domestic stocks.

Decline in sugarcane production and yields have emerged as the main culprits behind rising sugar costs. Former Maharashtra Sugar Commissioner Shekhar Gaikwad and other experts point to reduced cane output as the fundamental issue constraining supply. Simultaneously, traders stockpiling sugar to benefit from elevated prices have exacerbated supply pressures in the retail market.

The government maintains that the country possesses sufficient sugar stocks to meet domestic demand, suggesting that price pressures stem from supply-side constraints and market behavior rather than policy decisions. The debate underscores tensions between political parties over energy policy and its economic implications for consumers.