Indian Sugar Production Faces Setbacks as Excessive Rainfall Impacts Yield

India's sugar production is expected to fall below initial estimates due to excessive rainfall affecting cane yields in major producing states. Global sugar prices may rise as India struggles to meet its export quota, potentially shipping only half of it. Domestic prices are also expected to increase.

India's sugar production is set to fall short of initial estimates as excessive rainfall hampers cane yields in key producing states, Reuters reports. This shortfall could limit exports from the world's second-largest sugar producer, affecting global markets.

According to traders, the country might face challenges shipping even half of its allocated export quota. This situation could bolster global sugar prices, which are currently near five-year lows, while also driving domestic prices higher. Internal estimates from five trade houses suggest India will produce between 28.5 million and 29 million metric tons of sugar during the 2025/26 marketing year, ending in September.

The Indian Sugar & Bio-Energy Manufacturers Association (ISMA) had predicted an output of 30.95 million tons for the year. The largest production cut is expected in Maharashtra, India's top sugar-producing state. Farmers, like Vilas Patil from Kolhapur, report disrupted growth cycles due to heavy rainfall. Domestic production issues and increased seasonal demand are likely to further support sugar prices.

(With inputs from agencies.)