Coop sugar federation projects 35 mt sugar output in 2025-26 season

Currently the ex-mill sugar prices remain stable at ₹3,880-3,920 per quintal. 
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The National Federation of Cooperative Sugar Factories (NFCSF) on Monday said this year’s closing stock of sugar on September 30 will likely be 4.87 million tonnes (mt), which is adequate to meet first two months’ demand in next season as the sugar production in 2025-26 season (October-September) is likely to be 35 mt.

“As per current projections, the closing stock of sugar at the end of 2024–25 season is estimated at approximately 4.87 mt. This stock level is considered adequate to meet domestic consumption requirements for the crucial months of October and November 2025, ensuring price stability and uninterrupted supply,” the NFCSF said in a statement.

However, it could not rule out 2 per cent margin of error in the calculations while arriving at closing stock as the data are based on information derived from the monthly release orders issued by the government and information furnished by sugar mills.

Prices stable

The cooperative body also said that currently the ex-mill sugar prices remain stable at ₹3,880-3,920 per quintal. This stability is supported by timely government interventions like permission for limited sugar exports and controlled release of monthly domestic quotas, which have effectively balanced supply in the domestic market even though there was lower net production and strong market demand.

Projecting a strong recovery in production during 2025–26 season, with estimated gross sugar output of about 35mt, Harshvardhan Patil, president of NFCSF, said: “This anticipated rebound is due to favourable monsoon conditions and increased cane cultivation in key producing states such as Maharashtra and Karnataka.”

The statement said that sugar production has reached 28.69 mt as of April 30 during the ongoing 2024-25 season, out of which 3 mt has been diverted for ethanol.

The Centre’s announcement of increased fair and remunerative price (FRP) of sugarcane for next season has also helped farmers to opt for cultivation of the cash crop, he added. The Cabinet Committee on Economic Affairs (CCEA) April 30 approved a hike of ₹15/quintal in the fair and remunerative price (FRP) of sugarcane to ₹355/quintal for the next sugar season beginning October. The industry body has also sought a revision in ethanol procurement prices by oil marketing comaonies (OMCs) and suggested extension of blending targets beyond 20 per cent.

Ethanol price

The government should revise ethanol procurement prices to reflect the rising cost of feedstocks like sugarcane, maize, and rice. It should also extend blending targets beyond 20 per cent, with a clear, phased timeline up to 2035. Besides, accelerated promotion and manufacturing of Flex-Fuel Vehicles (FFVs) is the need of the hour to boost ethanol demand and ensure market preparedness for higher blending, the cooperative federation said adding option of ethanol blending with diesel be explored.

Stating that these suggestions were conveyed by an industry delegation, led by Ravi Gupta, Chairman of the Sugar Bioenergy Group of Indian Federation of Green Energy (IFGE), last month with Tarun Kapoor, Adviser in the Prime Minister’s Office, the NFCSF said that the sugar sector’s contribution in ethanol production is likely to drop to nearly half in 2024-25 from 73 per cent in 2022-23. NFCSF’s MD Prakash Naiknavare was also a member of the delegation.

Significant milestone

In 2022-23 season, the sugar industry reached a significant milestone by diverting 43 lakh tonnes of sugar (in terms of sucrose) towards ethanol production, enabling the supply of 369 crore litres of ethanol. But, it declined to 270 crore litres, contributing only 38 per cent share in the total ethanol sold for the blending programme. “This is projected to fall further to 250 crore litres in 2024-25, making up just 28 per cent of the total blending target of 900 crore litres,” it said.

Pointing out that the main factor for this drop is not to raise ethanol prices commensurate with hike given in the FRP of sugarcane, making ethanol production less profitable for sugar mills, the NFCSF said sugar sector’s annual ethanol production capacity of 952 crore litres is being under-utilised.

Published on June 2, 2025