Sugar stocks experienced significant selling pressure in morning trade, with shares falling up to 4 per cent following the government's announcement of an immediate export ban. According to reports from Business Standard, the ban applies until September 2026, or until further orders, creating immediate market uncertainty for the sector. The government's decision comes at a time when global sugar prices are already witnessing an uptick, raising concerns over food inflation and supply pressures.
Dwarikesh Sugar Industries emerged as the top loser, declining 3.6 per cent to trade at ₹45.03 on the National Stock Exchange as of 9:35 AM, as reported by Business Standard. Other major sugar companies also faced significant pressure, with Dhampur Sugar Mills, Balrampur Chini Mills, and Uttam Sugar Mills all falling 3 per cent each to ₹149.19, ₹533.25, and ₹244 respectively. The broader sugar sector saw multiple companies decline in the 1-3 per cent range, including Bajaj Hindusthan Sugar, Dalmia Bharat Sugar, MVK Agro Food Product, Magadh Sugar & Energy, KM Sugar Mills, and Sakthi Sugars.
The government's latest notification on sugar ban includes specific exemptions that provide some relief to certain export categories. As reported by Business Standard, the ban does not apply to sugar being exported to the European Union and the US under the tariff rate quota scheme. The order also excludes shipments under the advance authorisation scheme, government-to-government exports, and consignments already in the physical export pipeline. The ban specifically covers raw, white and refined sugar and represents a shift in policy from "restricted" to "prohibited" status.
Market experts anticipate continued pressure on sugar stocks in the near term due to the export ban's impact on sector fundamentals. According to Ponmudi R, CEO of Enrich Money, as reported by Business Standard, the government's order represents a negative development for the sector. The expert highlighted that export opportunities were one of the key earnings drivers for sugar mills over the last few quarters, and the ban's implementation will create margin pressure as excess supply remains within the domestic market while inventory levels rise. With milk prices already rising and concerns building around food inflation, this latest move signals potential broader economic implications for consumers and markets.
