India is expected to suspend sugar exports and divert less cane to ethanol production in the upcoming 2026-27 season, a move driven by critically low ending stocks that threaten domestic food security.
The government has maintained the August domestic sales quota at 22.5 million tonnes, matching the year-ago period, signaling a refusal to release additional volumes to international buyers despite global price pressures.
This allocation strategy underscores the severity of the supply crunch, as authorities prioritize stabilizing local prices over generating export revenue.
The decision marks a continuation of a structural shift in the global sugar market, where India, traditionally one of the world’s largest exporters, is likely to remain absent from the export market for at least three more seasons.
The prolonged absence of Indian supply is being driven by a combination of El Niño-induced crop stress and surging domestic ethanol demand, which has consumed a significant portion of the sugarcane harvest.
With little to no surplus expected, global traders are facing a tighter supply environment that could keep prices elevated well into the next fiscal year.