Maharashtra Chief Minister Devendra Fadnavis on Wednesday, 27 May 2026 publicly welcomed a decision by Union Home and Cooperation Minister Amit Shah to revise the Minimum Support Price (MSP) for sugar and increase the ethanol procurement quota, calling it a 'very positive decision' for the sector.

Context

Posting from New Delhi, Fadnavis wrote in both Marathi and Hindi: 'साखरेचा एमएसपी आणि इथेनॉल कोटा वाढीसंदर्भात मा. केंद्रीय गृह व सहकार मंत्री अमितभाई शाह यांनी अतिशय सकारात्मक निर्णय घेतला आहे' — meaning, 'Regarding the increase in sugar MSP and ethanol quota, Union Home and Cooperation Minister Amitbhai Shah has taken a very positive decision.' The post tagged @AmitShah directly, framing the announcement as a Centre-driven initiative with state-level significance.

Maharashtra is one of India's largest sugarcane-producing states, home to a dense network of cooperative sugar mills that collectively process millions of tonnes of cane each crushing season. Any revision to sugar MSP or ethanol quota directly affects the financial health of these mills and the income realised by farmers.

Policy Backdrop

The sugar sector's MSP — distinct from the Fair and Remunerative Price (FRP) paid to sugarcane growers — sets a floor for ex-mill sugar sales and is periodically revised by the central government under the Sugarcane (Control) Order, 1966. A higher MSP improves mill revenues, which in turn supports their capacity to clear dues owed to farmers.

The ethanol quota expansion fits within the National Policy on Biofuels, 2018, which set a target of 20% ethanol blending in petrol by 2030. Under the Ethanol Blending Programme, sugar mills supply ethanol derived from cane juice or molasses to oil marketing companies, providing an alternative revenue stream that helps mills manage surplus sugar stocks while advancing the country's energy security goals. Amit Shah, who has held the Cooperation portfolio since 2021, has been a central figure in aligning cooperative sugar sector interests with national biofuel policy.

Stakeholders and Impact

Sugarcane farmers across Maharashtra stand to benefit most directly: higher sugar MSP strengthens mill finances, reducing the risk of delayed or unpaid cane arrears that have historically been a source of rural distress. Cooperative sugar mills, which dominate the sector in the state, gain improved pricing certainty for their primary product.

An expanded ethanol quota also opens a larger procurement channel, allowing mills to divert more cane output towards ethanol production. This dual benefit — better sugar pricing and greater ethanol offtake — is seen as a structural support mechanism for a sector that has long been caught between surplus production and volatile market prices.

What's Next

The formal notification of revised ethanol procurement prices by the central government and the state-level rollout of any MSP-linked payment mechanisms will be closely watched ahead of the 2026-27 crushing season. Maharashtra's cooperative mills and farmer bodies are expected to assess the revised numbers once official orders are published.

For CM Fadnavis, the announcement offers a political moment to demonstrate that the state's engagement with the Centre on agricultural pricing is yielding results — a message likely to resonate in the sugarcane belt ahead of the new season.