India bans sugar exports till September 2026 amid domestic supply concerns

The Central Government has banned sugar exports with immediate effect until September 30, 2026, citing domestic supply considerations and inflation concerns. The order, issued by the Directorate General of Foreign Trade under the Ministry of Commerce and Industry, changes the export status of sugar from “restricted” to “prohibited.” The notification applies to raw sugar, white sugar, and refined sugar, although exports to the European Union and the United States under existing tariff-rate quota arrangements will continue to be permitted.

According to the government notification, sugar exports will still be allowed in cases where loading had commenced before May 13 or where consignments had already been handed over to customs authorities before the order came into effect. The order also stated that exports may be permitted based on approvals granted by the Government of India to other countries for food security requirements following requests from their respective governments.

The decision comes months after the government had allowed limited sugar exports based on earlier expectations of surplus production. Industry estimates later revised India’s projected sugar output for the 2025-26 season ending September 30 to around 320 lakh tonnes from earlier projections of 324 lakh tonnes. Officials and industry observers indicated that concerns over domestic availability, food inflation, and uncertainties linked to global geopolitical developments influenced the policy reversal.

Current estimates indicate that India may have total sugar availability of nearly 325 lakh tonnes during the season, including opening stock, while domestic demand is projected at approximately 280 lakh tonnes. This could leave closing stock at around 45 lakh tonnes, one of the lowest levels recorded in recent years. Concerns have also been raised regarding possible weaker monsoon conditions linked to El Niño and the impact of global disruptions on fertiliser availability and agricultural production.

The export restriction triggered immediate reactions in international commodity markets, with global raw and white sugar futures recording gains following the announcement. India is the world’s second-largest sugar producer after Brazil and one of the largest exporters globally. Industry sources stated that several export contracts had already been signed before the announcement, while traders and sugar mills are now assessing the impact of the sudden policy change on pending overseas commitments.