Padma Shri awardee and agricultural scientist Dr Bakshi Ram, former Director of ICAR-Sugarcane Breeding Institute, Coimbatore, on Monday said the recent spike in sugar prices has nothing to do with ethanol production, pointing instead to market sentiment, stockpiling, and manufactured concerns around availability as the real culprits. He stressed that India holds more than enough sugar to meet domestic demand.

Why Ethanol Is Not the Culprit

Dr Ram explained that ethanol production in India operates under strict government oversight. Decisions on diverting sugar — whether through B-heavy molasses, C-heavy molasses, or syrup — are taken only after assessing domestic availability and existing stock levels. He argued that blaming ethanol for the current price rise is factually inaccurate.

According to Dr Ram, the ethanol programme has, in fact, been a net positive for the sugar sector — strengthening the financial health of mills and enabling timely payments to sugarcane farmers across the country.

India's Sugar Supply Position

'India produced around 30–31 million tonnes of sugar in the last season, while domestic consumption is around 27–28 million tonnes. In addition, the country maintains a buffer stock of around 6–7 million tonnes every year. There is, therefore, no actual shortage of sugar,' Dr Ram said.

This comes amid rising retail sugar prices that have prompted concerns among consumers and policymakers. Notably, these figures suggest a comfortable surplus — not a supply crunch — making speculative hoarding and sentiment-driven buying the more plausible explanations for the price pressure.

Early Crushing Advisory: What It Means

On the government's advisory to sugar mills to begin crushing from October 15, Dr Ram said an earlier start would bring fresh sugar to market sooner, which could ease supply anxieties. He acknowledged, however, that starting before the traditional post-Diwali window may marginally reduce sugar recovery, as sugarcane typically reaches peak sugar content later in the season.

'If mills start crushing on October 15 or earlier, fresh sugar will become available in the market sooner. This will increase supplies and could also discourage stockpiling, thereby reducing pressure on prices,' he said.

Lessons From Past Overproduction

Dr Ram recalled that a few years ago, sugar output had significantly outpaced domestic requirements, triggering a sharp fall in prices. That glut had strained the finances of several mills, with some struggling to clear dues owed to farmers — a reminder that the sector is as vulnerable to oversupply as it is to speculative demand shocks.

With the early-crushing advisory now in play, the government appears to be using supply-side timing as a lever to stabilise prices — a strategy that, if executed well, could pre-empt further hoarding before the festive season demand surge.