Excess rainfall reduces cane yields across major producing states.
Output seen below estimates, challenging export commitments.
Lower supplies may support domestic and global prices.
India is likely to produce less sugar than initially estimated, as excessive rainfall across major producing states is resulting in lower cane yields, farmers and trade officials told Reuters, capping exports from the world’s second-largest producer.
Traders admitted that India may struggle to ship even half of its allocated export quota, lending support to global sugar prices that are hovering near five-year lows while also lifting domestic prices.
3 February 2026
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India is expected to produce between 28.5mn and 29mn metric tonnes of sugar in the 2025/26 marketing year ending in September, according to internal estimates from five trade houses that declined to be named in line with company policies.
The Indian Sugar & Bio-Energy Manufacturers Associations (ISMA) has forecast output at 30.95mn tonnes for the year.
“Cane yields are down across all the main producing states. From Maharashtra and Karnataka to Uttar Pradesh and Gujarat and that’s pushing this season’s production estimates lower,” said Rahil Shaikh, Managing Director of Mumbai-based MEIR Commodities India.
According to Reuters, the largest reduction is expected in top producer Maharashtra, with output observed at about 9.6mn tonnes compared to an earlier estimate of 10.8mn tonnes.
About five dozen farmers from cane-growing regions of Maharashtra and neighbouring Karnataka said that excessive rainfall damaged root development and led to early crop maturity.
Cane-growing regions of Maharashtra received as much as 115% more rainfall than normal in September, weather department data showed.
Maharashtra has produced 9mn tonnes of sugar so far this season and nearly half of the 207 mills that began crushing have already shut due to cane shortages, said a senior state government official told Reuters, who declined to be named as he is not authorised to speak to media.
The downward revision in sugar output, coupled with an expected rise in seasonal summer demand from next month, is likely to support prices, a Mumbai-based dealer.
India on Friday allowed the export of an additional 500,000 tonnes of sugar, on top of the 1.5mn tonnes approved earlier, taking total export quota for the year to 2mn tonnes.
“Mills are fetching higher prices in the domestic market, so they have little incentive to export. Indian shipments are unlikely to exceed 700,000 tonnes,” Shaikh told Reuters.
Export-Price Dynamics
Sugar mills in India, the second-largest producer, have been struggling to export big volumes in the new season, with traders and analysts saying that the pace will only pick up if global price rise sharply, reported Bloomberg in December 2025.
The government had approved 1.5mn tonnes of overseas sales in November 2025 for the year ending September, and there is pressure to increase the quota. A leading millers’ group has asked to permit another 1mn tonnes to support domestic prices as the nation is heading for a surplus.
However, the report stated that the international rates in December 2025 have not been strong enough to send large quantities. Supplies from top shipper Brazil remain attractively priced, making it tough for Indian mills to compete despite the South Asian nation’s proximity to some of its traditional markets.
