To address the risk of excess supply in the current sugar season (October–September), the government has permitted the export of up to 50,000 metric tonnes (MT) of organic sugar per year with immediate effect.
According to a notification issued by the Directorate General of Foreign Trade (DGFT), organic sugar has been removed from the ‘prohibited’ export category, subject to an annual cap of 50,000 tonnes.
Context: balancing sugar stocks
The decision comes amid efforts to manage rising sugar output. Earlier, the government had allowed 1.5 million tonnes (MT) of conventional sugar exports in the 2025–26 sugar season to balance domestic stocks, support sugar mills’ liquidity, and prevent undue pressure on local prices.
“This move aligns with the broader strategy of managing India’s sugar balance sheet,” said Deepak Ballani, Director General of the Indian Sugar and Bio-energy Manufacturers Association (ISMA).
Ballani noted that export quotas are being calibrated based on comfortable domestic stock levels and evolving market conditions, including surplus production and diversion of sugar towards ethanol.
Boost for organic sugar segment
ISMA said that organic sugar production in India remains limited, with only a small number of certified mills and exporters currently operating. Allowing exports is expected to encourage investment in organic cultivation and processing, and support expansion in this niche segment.
Industry sources added that the move will help diversify India’s sugar export portfolio and incentivise farmers and millers to adopt organic practices. Organic sugar typically commands premium prices in overseas markets such as the United States, Europe and parts of Asia.
Export progress and ethanol diversion
Ballani said that 0.15–0.2 MT of export contracts out of the approved 1.5 MT of conventional sugar exports have already been awarded or are in the process of finalisation, even as global sugar prices remain below domestic ex-mill prices.
To safeguard farmers from delayed cane payments in the event of surplus supplies, the government is also focusing on expanding export avenues and increasing diversion of sugar for ethanol production, Food Secretary Sanjeev Chopra has said.
Production and consumption outlook
ISMA has projected sugar production at 34.3 MT in the ongoing crushing season, marking a 16 percent increase over the previous year. Of the total output, 3.4 MT is expected to be diverted for ethanol manufacturing, while 1.5 MT has been cleared for exports.
Domestic sugar consumption for the 2025–26 season is estimated at 28.5 MT. With an opening stock of 5 MT as of October 1, closing stocks at the end of the season are projected at around 6 MT, equivalent to more than two months of consumption.
