India tightens sugar stock limits to tame record prices

The Indian government ​has ordered that no dealer using more than 10 metric tons of sugar per month shall hold inventories for more than 15 days, ‌a government ⁠order ⁠showed on Wednesday as India looks to tame record prices of the sweetener.

The official order will come into force on September 1 ​and remain in force until November 30, the notification said. The move comes after a day after Reuters reported that India was considering measures to bolster sugar supplies and rein in record prices, including limited duty-free imports and ​tighter stockholding limits for bulk traders, potentially ⁠allowing overseas ‌shipments for the first time in nearly ​a decade.

Also read: India weighs sugar import duty cut to curb record local prices


The sugar demand is expected to rise between the August to ⁠November period as major festivals such ​as Ganesh Chaturthi, Dussehra and Diwali fall in this duration. The cultural push leads to to ​bulk consumers such as biscuit and confectionery makers building inventories ahead of the festival season.

Last month, India, the world's biggest sugar consumer nation, ordered dealers to hold stocks for no more than 30 days, in a bid to bolster supplies, Reuters reported.

Yet, ‌the sugar prices have jumped 10% over the past month to a record high and are ​expected to ​remain high for ⁠at least the next three months as supplies tighten and festive demand gathers pace across states.

Alongside this, patchy rains and dry weather conditions have hit ​the sugarcane crop, which typically requires enormous amounts of water for irrigation.