Govt Tightens Sugar Supply Rules, Mills To Get Fortnightly Sale Quotas From September As Prices Ease
New Delhi, August 28, 2026: The government will shift from monthly to fortnightly sugar sale quotas for mills from September as it moves to ensure steady supplies and prevent artificial scarcity in the domestic market. The decision comes as sugar prices have begun easing, with ex-mill rates falling around 20% in recent days. The Food Ministry said there is no shortage of sugar in the country and…
New Delhi, August 28, 2026 - The Indian government is transitioning from monthly to fortnightly sugar sale quotas for mills starting September. This change aims to ensure steady supplies and avoid artificial shortages in the domestic market. The move comes as sugar prices have eased, dropping approximately 20% in recent days. The Food Ministry maintains that there is no shortage of sugar in the country and is closely monitoring availability and prices.
During the physical verification of stocks, officials discovered discrepancies where some mills held more sugar than declared in their monthly returns, while others sold less than their monthly quota. To address these issues, the government now requires mills to sell at least 40% of their fortnightly allocation within the first week and the remaining quantity in the following week.
The government has also directed mills to dispatch sugar within seven days of its sale. This practice aims to prevent artificial scarcity and improve the overall supply chain. Bulk consumers are asked not to hold stocks beyond their operational requirements.
Sugar prices have begun falling as a result of the government's actions, with ex-mill rates dropping around 20% in recent days. Retail prices are also starting to decline, suggesting that the recent price surge was primarily driven by hoarding and speculation rather than an actual shortage of sugar.
Looking ahead to the 2026-27 marketing year, which begins in October, sugarcane crushing is expected to start from October 15, with over 10 lakh tonnes of sugar anticipated to be produced in the new season. Mills will be allowed to sell sugar produced in October without any restrictions, ensuring that new-season output reaches the domestic market at the earliest.
With production and domestic demand closely matched after ethanol diversion, the government remains committed to maintaining orderly supplies, particularly during the upcoming festive season.
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