Concerns surrounding global supply of sugar as well as domestic availability is lending further support to the prices.
Domestic sugar prices are currently around ₹5,000-₹5,090 per quintal in Mumbai, as concerns over deficient rainfall have supported prices.
Global sugar prices have also moved higher, with raw sugar touching a one-year high of 16.6 cents per pound, while white sugar prices surging to their highest levels in around 15 months.
Market participants are closely tracking production risks in key sugar-producing regions such as Brazil, Thailand and the European Union, while expectations of a global sugar deficit in the 2026-27 season, which runs from October to September, have also supported prices.
Key sugar stocks that could remain in focus include Balrampur Chini Mills, EID Parry (India), Triveni Engineering & Industries, Shree Renuka Sugars and Bajaj Hindusthan Sugar as domestic sugar prices remain elevated.
Government tightens sugar dispatch norms
The government has mandated sugar mills to deliver sugar stocks within seven days of sale, with the order valid until November 30, 2026.The move follows observations that some mills were completing sales at the beginning of the month but dispatching stocks only towards month-end. The Department of Food and Public Distribution said such delayed dispatches could create artificial scarcity and encourage speculative buying.
The department has warned that non-compliant mills will face legal action and said it will continue physical verification of sugar mills to ensure compliance. The government recently conducted an inspection drive to physically verify stock positions at mills.
In July, the government also imposed a stockholding limit on traders for four months starting August.
Industry participants expect the government could consider further measures if prices remain elevated. These could include restricting the use of sugarcane for ethanol production from October, bringing forward the crushing season, releasing weekly sales quotas for mills and allowing sugar imports at zero duty.
Brent crude prices are also back near the $92 a barrel mark as the US and Iran remain in a deadlock in West Asia over the Strait of Hormuz. An increase in oil prices is likely to support Ethanol values, with major sugar-producing countries like Brazil shifting more towards ethanol production instead of sugar. Such a shift could also tighten global supply of sugar.
Shares of Dhampur Sugar are off the highs of the day, currently trading 3.8% higher at ₹174.99. The stock has risen 42% so far this year.
Shares of Dwarikesh Sugar have also come off the highs, but are holding on to gains of 6.7% at ₹47.63.
Bajaj Hindusthan Sugar shares are trading with gains of 9% at ₹20.27. The stock has turned positive on a year-to-date basis.
