Government tightens rules on sugar stocks to curb hoarding ahead of festivals | Today’s news

New Delhi: The government has tightened sugar stock holding norms for retailers ahead of the festive season, halving the allowable stock to 1,000 quintals and the holding period to 15 days, in a bid to curb hoarding and ensure adequate supply to consumers during the peak festive season beginning 11.

The revised norms will come into force from October 15 and will remain in force till November 30, the Ministry of Consumer Affairs, Food and Public Distribution said on Thursday. Dealers will not be allowed to hold sugar for more than 15 days from the date of receipt or hold stock in excess of 1,000 quintals at any place at any given time, the company said.

The move is aimed at keeping sugar prices under control at a time when demand usually rises during the festive season. Retail sugar prices remained flat ₹55.62 per kg on October 1, up 20% from a year earlier. However, prices corrected sharply from their August peak and fell by 11.7%. ₹62.96 per kg a month earlier.

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However, a higher stock holding limit of 2,000 quintals has been allowed in Kolkata and its extended metropolitan areas and Assam, keeping in mind the logistical requirements for sugar supply to eastern and northeastern India and the seasonal surge in demand during Durga Puja.

“Kolkata sources sugar from Uttar Pradesh, Maharashtra and Karnataka and supplies it to the eastern part of the country, including the northeastern region,” the ministry said, explaining the higher limit for the region. The additional allowance for Assam takes into account geographical constraints and transport logistics.

Sugar season begins

The move comes at the start of the new sugar season on October 1, as the government seeks to prevent stockpiling in the distribution chain and discourage speculative trading during a period of potentially higher consumer demand.

“The latest intervention comes as the government tries to balance two conflicting objectives in sugar policy – ensuring profitable yields for sugarcane growers while keeping retail sugar prices affordable for consumers,” said Binod Anand, member of the high-powered committee on minimum support price (MSP) and agricultural reforms.

The tighter standards for holding stocks come as sugar prices have fallen sharply from their August peak. According to the government, average retail sugar prices have fallen 15% since their peak in August, while ex-factory prices have fallen around 28%.

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Ex-factory prices have remained stable over the past three weeks, with the government expecting lower factory-gate prices to gradually trickle down the distribution chain and further reduce retail prices.

The government has asked sugar mills, traders, wholesalers and other market participants to ensure continuous movement of stocks and prevent artificial hoarding. Wholesalers and retailers were also encouraged to pass on the price drop from the plant to the consumer.

Expanding Availability

On 21 August, the government allowed duty-free imports of 1 million tonnes of raw sugar to increase domestic availability and reduce prices.

India’s domestic sugar consumption is estimated at 28 million to 28.5 million tonnes per year and production was about 28 million tonnes in the 2025-26 sugarcane crushing season. Consumption by businesses such as food and beverage companies, hotels, restaurants, the hospitality sector and processed food companies accounts for 60-65% of total demand, with the rest consumed by households.

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The measures take on significance as the new sugar season begins and holiday demand typically boosts consumption. By limiting both the amount and the duration for which traders can hold stocks, the government is trying to limit the scope for stockpiling at the intermediary level.

The government has also asked sugar mills to start crushing based on agro-climatic conditions in their respective regions, it said.

It will continue to monitor the impact of uneven and deficient rainfall associated with El Niño conditions on sugarcane in some producing regions and take measures to maintain domestic availability, the government said.

State governments have also been advised to take appropriate decisions to start crushing operations based on field conditions, it said.