India Faces Second Consecutive Sugar Deficit as Mills Close Early
India is projected to experience a sugar deficit for the second consecutive year as lower sugarcane yields compel mills to conclude crushing operations earlier than usual. This situation is expected to deplete domestic sugar stocks and support local prices, which had been under pressure from oversupply. Production is now forecast to be below 28 million tonnes, significantly lower than initial estimates.
India is set to face a sugar production shortfall below its consumption for the second consecutive year, primarily due to diminished sugarcane yields forcing mills to conclude their crushing operations earlier than typical. This information was shared by trade officials with Reuters on Thursday, the 2nd. The reduced output, combined with increased exports, is likely to draw down domestic stockpiles and bolster local prices, which had previously been under pressure from an oversupply.
“Sugar production is unlikely to exceed 28 million tonnes this season,” stated the head of the Indian branch of a Mumbai-based global trading firm. “Most sugar mills have already ceased crushing, with only a few remaining operational, expected to close in the coming weeks.”
At the beginning of the season, industry bodies such as the Indian Sugar Mills Association and Bioenergy (ISMA) and the National Federation of Cooperative Sugar Factories (NFCSF) had projected production around 31 million tonnes against a domestic demand of 28.5 to 29 million tonnes. However, data from NFCSF indicates that lower yields in cane fields, attributed to excessive rainfall, compelled 467 out of the 541 operational mills this year to shut down by the end of March. In contrast, only 420 mills had concluded their season by the same period last year. Indian sugar mills produced 27.12 million tonnes of sugar in the first half of the 2025/26 season, which is scheduled to end in September 2026.