- Starting September 15, 2026, new regulations will cap dealer inventory at 2,000 quintals nationwide and limit holding to 30 days.
- An exception allows Kolkata to maintain a higher limit of 4,000 quintals due to its role in sourcing sugar from Uttar Pradesh and Maharashtra.
- The measure aims to ensure adequate availability of sugar in the domestic market, and as the festive season approaches, the further reduction is expected to help lower domestic sugar prices.
- Previously, the government allowed the duty-free import of one million tonnes of raw sugar after domestic sugar prices reached a 16-year high.
- Despite lower domestic sugar production, the government permitted the export of 800,000 tonnes of sugar to the international market this year, facing criticism.
- The government’s efforts to manage sugar prices since the first week of August have led to ex-mill sugar prices declining by around 20%.
- The processed sugar obtained from the imported raw sugar must be supplied to the domestic market by October 31, 2026.
- The government is closely monitoring sugar market developments and has implemented a mechanism for regularly declaring and updating sugar stocks through the Department of Food and Public Distribution’s online portal.
India's Central Government has implemented a significant reduction in the stockholding limit for sugar dealers, cutting it from 4,000 quintals to 2,000 quintals nationwide, effective September 15, 2026, until November 30, 2026.123
This measure aims to curb hoarding and speculative trading, ensuring adequate availability of sugar in the domestic market as the festive season approaches, when demand typically rises.
Despite the nationwide reduction, Kolkata is exempt from this limit, maintaining a higher threshold of 4,000 quintals due to its role in sourcing sugar from Uttar Pradesh and Maharashtra for the eastern and north-eastern regions.
Additionally, dealers will be prohibited from holding sugar for more than 30 days from the date of receipt, further tightening stock management.
The government's efforts to manage sugar prices have shown results, with ex-mill sugar prices reportedly declining by around 20% following increased monitoring since early August. This comes after the government allowed the duty-free import of one million tonnes of raw sugar to address a 16-year high in domestic prices.6
Despite lower domestic production, the government has also permitted the export of 800,000 tonnes of sugar this year, a decision that has faced criticism from political circles and experts regarding potential policy missteps. The government continues to monitor the sugar market closely, implementing a mechanism for regular updates on sugar stocks through the Department of Food and Public Distribution's online portal.7
“The new rules, effective September 15, 2026, also bar dealers from holding sugar for more than 30 days, while Kolkata retains a 4,000-quintal cap to supply eastern regions. Ex-mill prices have already dropped around 20% since August, following duty-free imports of one million tonnes.”
