Indian Sugar Stocks Rally as Prices Surge 24 Percent

Shares of Indian sugar producers rallied on Monday, with Bajaj Hindusthan Sugar gaining over 11%, Dwarikesh Sugar Industries rising 10%, and Shree Renuka Sugars climbing 8.5%. The surge follows a 24% increase in domestic sugar prices to Rs 56-60 per kg, driven by delayed monsoons, El Nino effects, and speculative buying by traders ahead of the festive season.

To stabilize the market, the Government of India banned sugar exports from May 13 until September 30 and approved duty-free imports of 1 million metric tons of raw sugar on August 20. However, market tightness persists as a significant portion of these shipments is not expected to arrive until October.

The Indian Sugar Mills Association and the National Federation of Cooperative Sugar Factories denied that mills created artificial scarcity. ISMA President Niraj Shirgaokar stated that India does not have a sugar shortage, attributing the price spike to weather and speculation. Industry leaders expect retail prices to decline once imports from Brazil arrive and mills resume operations around October 15. The NFCSF estimates opening stocks for the 2026-27 season at 35 lakh tonnes, while ISMA projects a closing stock of 35 lakh tonnes by the end of September.