Sugar stocks experienced significant gains as global sugar prices climbed to an 18-month high, rising around 4% overnight, 11% over the past month and 33% so far in 2026. According to CNBC TV18, Dalmia Bharat Sugar & Industries was the biggest gainer, rising as much as 8.6% intraday, while Balrampur Chini Mills gained up to 6.4%. Triveni Engineering & Industries and Shree Renuka Sugars advanced as much as 5% each, while EID Parry rose nearly 3%. In Tuesday's trading session, the rally intensified with sugar stocks surging up to 9%, led by Dhampur Sugar Mills rallying 8.56% to ₹192 and Sakthi Sugars gaining 8.7% to ₹19.35 on the National Stock Exchange. Dalmia Bharat Sugar rose 8.5% to ₹466.95, Dwarikesh Sugar Industries jumped 7.8% to ₹47.59, and Shree Renuka Sugar added 4.5% to ₹22.84. As per Business Standard, Balrampur Chini Mills, Avadh Sugar & Energy, Bajaj Hindusthan Sugar and Uttam Sugar Mills also traded 2-3% higher. However, sugar stocks were underperforming the NIFTY50 index as most traded up to 2.5% lower against the index's 0.55% fall.
The global supply outlook has tightened significantly with StoneX estimating a sugar deficit of around 9,00,000 tonnes for 2026-27. Production concerns have emerged across major sugar-producing regions, including Thailand's sugar production expected to fall 17% to below 10 million tonnes, while European Union sugar-beet crops are estimated to be down 19%. In Brazil, rains have delayed harvesting and crushing activity, adding to concerns over near-term availability. As reported by CNBC TV18, Kapil Nema from Dalmia Bharat Sugar noted that the recent rise in global sugar prices reflects a more bullish market view amid concerns over Brazilian output. However, he does not see a major global supply deficit when raw and white sugar are considered together, with the market currently having a raw sugar surplus of around 2-2.5 million tonnes, while white sugar has a deficit of about 1 million tonnes.
Domestic supply concerns are supporting the bullish sentiment as India's sugar stocks stood at around 36 lakh tonnes as of October 1, while Dalmia Bharat Sugar's Deputy Executive Director-Sugar & Ethanol Business, Kapil Nema, expects inventories to settle at around 50-55 lakh tonnes. Nema estimates that India could face a sugar shortfall of around 2 million tonnes, potentially requiring imports. The timing of those imports remains a key policy decision for the government, with the government considering allowing imports either after the current crushing season ends or just before the next season begins. Domestic production is also facing weather-related risks as recent rains in Uttar Pradesh have raised concerns over the cane crop and could reduce sugar output from the state by around 1,00,000-2,00,000 tonnes, while Maharashtra and Karnataka have also experienced weaker rainfall. The new sugar crushing season is expected to begin from mid-October, which could bring fresh supplies into the market.
The Centre has implemented stricter measures to ensure adequate sugar supplies during the festive season. The government has allowed duty-free imports of up to 1 million tonnes of raw sugar under the Tariff Rate Quota (TRQ) until October 31, while dealers will face a stock limit of 1,000 quintals from October 15 to November 30. According to the ministry, "By restricting the quantity and storage period of sugar, the government aims to facilitate the orderly movement of sugar through the supply chain and ensure its continuous availability to consumers at reasonable prices." The government could also halt diversion of sugar towards ethanol production if domestic availability tightens further. As per CNBC TV18, the government could consider allowing imports either after the current crushing season ends or just before the next season begins, with the key question being whether the raw sugar surplus can be converted into white sugar through refining, which would depend on sufficient incentives for refiners.
