As sugar markets swing, eBuySugar bets on scale and digital trade

Sharp price swings, changing production outlooks, trade policy adjustments, and ethanol’s growing impact are driving India’s sugar market into a more unstable phase, reshaping how mills and buyers decide. Against this backdrop, eBuySugar has scaled to over 40 lakh tonnes of traded sugar worth over Rs 15,000 crore. Uppal Shah, Managing Director, JK India eAgriTech Ltd, talks about the forces propelling the business, how the industry is adjusting to increased uncertainty, and his vision for the next stage of growth. Edited excerpts.

The Economic Times (ET): When we spoke in 2022, eBuySugar had crossed Rs 400 crore in turnover. Where does it stand today, and what drove the growth?

Uppal Shah (US): First, a small correction for the record. In 2022 we had traded about 1.2 lakh tonnes of sugar, and that was what our Rs 400 crore turnover reflected.


The platform has grown quickly since then. By mid-2023 we had crossed 10 lakh tonnes and Rs 3,500 crore. Today, eBuySugar has traded more than 40 lakh tonnes of sugar, worth over Rs 15,000 crore, and has over 4,000 registered users. Every trade has been delivered, and we have not had a single default.

Two things drove this. The first is trust that was built long before the platform existed. My father started trading sugar in Kolhapur in 1981. By the time we went online, there was hardly a mill or trader in the country we had not dealt with.

The second is that we kept adding what the trade needed. We began by connecting buyers and sellers. In 2022 we became the counterparty to every trade, so the buyer pays us and we pay the mill. Then came logistics, insurance to destination, e-tenders for mills, and funding on request. Each step removed one more reason for someone to hesitate.

ET: The sugar market has changed considerably since 2022. How would you describe the state of the Indian sugar sector today, particularly with production estimates being revised, domestic prices rising and the government balancing consumer prices, mill economics and farmer payments?

US: This has been one of the most volatile years the sugar market has seen. Ex-mill prices in Maharashtra went from about Rs 38 a kg in June to nearly Rs 70 in August. They have since come back to about Ra 44, and to Rs 45 to Rs 46 in Uttar Pradesh.

We saw the rise coming. Through June and July, our team at ChiniMandi flagged that supply would tighten and prices would climb. We also put it in writing as a policy recommendation, including the case for duty-free imports to augment domestic availability. In August, the swing arrived, and duty-free imports were among the steps that followed.

That call came from our research desk. It also came from something harder to teach. I have spent nearly 30 years in this trade, and after that long you develop a feel for when a market is about to turn. We continue to work closely with policymakers, sharing what we see on the ground so that decisions work for everyone in the value chain, from the cane farmer to the bulk buyer.

For a buyer, a swing like this year's is hard to plan around. Whether prices are rising or falling, he needs two things: sugar that arrives on time, and a seller he can trust. That is what eBuySugar provides.

ET: Global developments, such as international prices, weather disruptions, export policies, and competition from other producing countries, are increasingly impacting India's sugar industry. How are sugar mills, traders, and large buyers navigating this greater uncertainty, and has it changed the way they buy and sell sugar?

US: Buyers are deciding faster and in smaller lots. Mills are watching their inventory and cash flow closely.

A platform can't make prices steady. What we can do is take the other risks off the table. On eBuySugar the buyer knows his sugar will reach him insured, and the mill knows its money will come and lift the goods in time. ChiniMandi and AgriMandi give both sides the price and market intelligence to judge their timing. With counterparty and delivery risk handled, they can concentrate on the one decision that is theirs to make, which is the price.

ET: The government has periodically adjusted export policy to balance domestic availability with the industry's export ambitions. From your vantage point as a marketplace connecting mills and buyers, how disruptive are these policy swings to the trade, and what would a more predictable sugar-trade framework look like?

US: Sugar policy has to balance consumers, farmers, and mills, and striking that balance is the government's job. Ours, as a marketplace, is to ensure that whatever the policy of the month, a buyer still gets his sugar on time at a fair market price and a mill still gets paid.

If you are a B2B buyer, you should be able to buy without having to decode every notification. That is the service we offer.

ET: Ethanol has become an important part of the sugar industry's economics, but the balance between sugar production, ethanol diversion, domestic consumption and exports remains a moving target. How is this changing the commercial decision-making of sugar mills, and what does it mean for traders and buyers?

US: Ethanol has changed the economics of the sugar mill. It began as a way to deal with surplus cane and excess sugar. Today, it gives mills a second source of revenue and steadier cash flow. It helps them pay farmers on time, and it cushions them when sugar prices swing.

The balance between sugar and ethanol moves with each season. In a surplus year, more cane goes to ethanol. In a tight year like this one, domestic sugar comes first. Either way, ethanol is now a permanent part of how a mill plans its year.

ET: In 2022 you wanted payment, logistics, insurance and delivery on the platform. What does the model look like today?

US: That idea is now the heart of eBuySugar. We learned early that introducing a buyer to a seller was not enough. The buyer asked, "If I pay, will I get my sugar?" The mill asked, "If I commit my sugar, will I get my money?" After that came trucks, insurance, documents, and delivery.

Today, we carry the whole trade. We are counterparty to every deal, so we guarantee payment to the mill and delivery to the buyer. We arrange logistics, insure the load to destination, run e-tenders for mills, and offer funding on request.

Every completed trade also adds to our record of how each buyer and each mill behaves. We have run the platform since launch without a single default, and that gives us the history to build credit into the platform itself. Embedded finance is the next piece we are adding.

ET: Break down what percentage of today's business comes from repeat customers versus new customers, average transaction size, top five customer categories, and whether the Rs 15,000 crore figure is GMV/gross transaction value or revenue.

US: We are the counterparty on every trade. We take the buyer's payment and pay the mill, so the value of the sugar passes through our books. What we earn is the trading margin, plus fees for the services around the trade, such as logistics and insurance.

The opportunity from here is to earn more from each trade. As we add finance and other services a buyer would otherwise arrange separately, each relationship becomes more valuable to us and more useful to the customer.

Our users span the sugar value chain: mills, distributors, C&F agents, resellers, traders, brokers and institutional buyers. What keeps them coming back is simple. On our platform, a trade that is booked is a trade that is completed.

ET: Looking ahead three to five years, where do you see the bigger opportunity for eBuySugar: becoming the digital infrastructure for physical sugar trading, expanding into jaggery and other agri commodities, or building financial, logistics and data services around the trade? What are the revenue and sales targets you are working towards?

US: At JK India eAgriTech Limited we say, "Sugar was the first harvest. Not the last." We always built eBuySugar as a platform for agri-commodities. In fact, the very first version of it has roots in 2011. We started with sugar because it is the trade we know best. The plan was to get the model right in one commodity and then open it up to others, and that is now happening.

We are now piloting maize and industrial ethanol on the platform, connecting aggregators with B2B buyers. The two belong together, since maize has become a major feedstock for ethanol. We are refining how each works in practice, and once we are satisfied, we plan to scale them.

Our other businesses have grown with us. Media through ChiniMandi and BioEnergyTimes, research through AgriMandi, and convening through SEIC, our awards and our roundtables now make a healthy contribution to our revenue. They also keep us close to the market every day, and that closeness is what makes the trading side work.

For a B2B buyer, the proposition is simple. If you buy sugar every month, and soon other agri-commodities, you should be able to do it without tracking every policy announcement, searching for a reliable seller, or chasing delivery. Come to eBuySugar. We assure your payment and your delivery and handle logistics and insurance, and embedded finance is on its way.