Now Reading: Centre rejects ethanol link to sugar price rise, blames low output
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Centre rejects ethanol link to sugar price rise, blames low output
The government on Friday rejected claims that the diversion of sugar for ethanol production is behind the recent spike in sugar prices, attributing the rise to lower domestic output, festive-season demand, weather-related…
The government on Friday rejected claims that the diversion of sugar for ethanol production is behind the recent spike in sugar prices, attributing the rise to lower domestic output, festive-season demand, weather-related crop damage, tighter global supplies, and hoarding. Sugar prices rose from Rs 48.18 per kg on July 20 to Rs 55.70 per kg on August 20, 2026.
The Ministry of Consumer Affairs said the share of sugar diverted for ethanol fell to about 9% in 2025-26 from about 12% in 2022-23, and nearly three-fourths of ethanol now comes from grains, mainly maize. It added that domestic sugar production this season is expected at around 306 lakh tonnes, below an initial estimate of 343 lakh tonnes, due to disease and waterlogging.
To control prices, the government has imposed a stock limit of 400 tonnes on dealers until November 30, barred bulk consumers from holding over 15 days of stock from September 1, and allowed duty-free import of 10 lakh tonnes of raw sugar. It has advised mills to start crushing from October 15 to boost supply during the festive season.
Indian Opinion Analysis
All three available sources report the government's statement without independent challenge, making the coverage uniform straight reporting. Hindustan Times and Times of India lead with the government's denial of the ethanol link and quote its five-factor explanation in full, while Livemint adds a structured Q&A format that foregrounds the same official rationale. None of the sources cite industry or opposition voices questioning the claim that ethanol diversion has fallen, nor do they scrutinise the government's own production estimate revisions. The key fact to watch is whether the duty-free import of 10 lakh tonnes and early crushing will stabilise prices before the festive season, or whether the global sugar deficit of 33 lakh tonnes pushes domestic prices higher.
Coverage: 4 sources, 3 neutral
Sources (4): hindustantimes.com (neutral report), timesofindia.indiatimes.com (neutral report), dnaindia.com, livemint.com (neutral report)
This story was synthesised by AI from the 4 sources linked above.
Updated: this story now draws on 4 sources.
