22/08/2026
Sugar Price Rise Not Linked To Ethanol Diversion: Centre
New Delhi: The central government has said that the recent surge in sugar prices is not connected to the diversion of sugar for ethanol production. The clarification came from the Ministry of Consumer Affairs, Food and Public Distribution on Friday.
According to the Ministry, it is incorrect to attribute the recent increase in sugar prices to diversion of sugar for ethanol production, as the share of sugar diverted for this purpose has declined from around 12 per cent in 2022-23 to around 9 per cent in 2025-26. The Ministry further stated that nearly three-fourths of the ethanol produced in the country now comes from grains, particularly maize.
Food Secretary Sanjeev Chopra briefed the media on sugar availability and prices. He said the government has taken precautionary measures, including allowing imports of 10 lakh tonnes of sugar by October. He added that only 28 lakh tonnes of sugar have been diverted for ethanol in the current 2025-26 marketing season.
According to the statement, the price rise is due to a combination of factors, including lower-than-expected domestic production, increased demand ahead of the festive season, weather-related damage to the sugarcane crop, tightening global supplies, and speculation and hoarding by some sections of the industry. Domestic retail prices had moved from Rs 48.18 per kg on July 20 to Rs 55.70 per kg on August 20.
The Ministry said it is closely monitoring market developments and has initiated regulatory and supply-side measures to maintain availability and price stability for consumers. The Centre has also asked states to act against hoarding and black marketing of sugar and to prepare for an early start to the crushing season by mills, around October 15.
