The government said the move is to ensure adequate availability of sugar to consumers at reasonable prices during the festive season.
With sugar prices having surged earlier this year, the Centre has further tightened stockholding limits for dealers as the new sugar season begins and India enters its peak festive season.
From October 15, sugar dealers will not be allowed to hold stocks for more than 15 days or keep more than 1,000 quintals at any location, a food ministry statement said on Thursday. The limits will remain in force until November 30. The government, the release said, made an exception for Kolkata and its extended metropolitan areas and Assam, where dealers will be allowed to hold up to 2,000 quintals, citing the region’s supply requirements and logistical constraints. Ex mill prices are hovering between ₹ 4,500 – ₹ 4,800 per quintal. Retail prices stood at ₹ 56 per kg, up 20% year-on-year. The new rules come into effect as the 2026-27 sugar season starts on October 1.
Kolkata is a major sourcing and distribution point for sugar from Uttar Pradesh, Maharashtra and Karnataka, supplying the eastern and northeastern regions. The government has also advised sugar mills to begin crushing based on the agro-climatic conditions in their respective regions. State governments have also been advised to take decisions on the timing of crushing operations based on field conditions. The government has asked sugar mills, dealers, wholesalers and other market participants to ensure continuous movement of stocks and avoid artificial accumulation. Wholesalers and retailers have also been asked to pass on the decline in ex-mill prices to consumers.
The higher limit for Kolkata and Assam has therefore been allowed to account for longer transportation distances and the logistical constraints of supplying the Northeast.
“The move comes even though retail sugar prices have already fallen 15% from their August peak, while ex-mill prices — the price at which sugar mills sell to bulk buyers before further distribution — have declined by about 28%,” according to the ministry. The government expects retail prices to ease further as the lower ex-mill prices work their way through the supply chain, it said. The tighter stock limits are intended to prevent dealers from accumulating sugar for long periods, curb speculative trading and ensure that stocks move from mills to consumers without disruption, the ministry said. The Centre said it would continue to monitor the impact of uneven and deficient rainfall associated with El Nino conditions on sugarcane in some producing regions and take measures to balance domestic availability, consumer prices and returns to farmers.
