New Delhi, January 6, 2026: India’s sugar industry has kicked off the Sugar Season 2025–26 (SSY26) on a notably strong footing, with production figures showing a sharp year‑on‑year improvement. According to industry data compiled by Centrum Institutional Research and reported today, all‑India sugar production reached approximately 12.0 million metric tonnes (MMT) as of December 31, 2025 — roughly a 25 % increase compared to about 9.5 MMT in the same period last year.
This growth has been supported by more operating sugar mills and better cane availability across key producing states. State‑wise performance shows Maharashtra leading the recovery, with output rising to 4.86 MMT compared with around 3.0 MMT last season, while Uttar Pradesh remained stable and Karnataka recorded healthy growth, contributing to the sector’s improved overall dynamics. Despite the positive production trends, the report highlights significant challenges in India’s ethanol segment.
Although the sugar industry has built an ethanol production capacity of around 1,500 crore liters, demand has largely plateaued at about 1,200 crore liters. High feedstock costs — with sugarcane and maize accounting for more than 70 % of ethanol production costs — are cited as a key factor inhibiting competitiveness and demand expansion. The report further notes that limited export opportunities for ethanol, especially compared to lower‑cost producers in countries like Brazil and the US, have contributed to sub‑optimal utilization of the expanded capacity.
This underlines an urgent need for both domestic demand growth and stable long‑term policies to ensure efficient use of the ethanol infrastructure built in recent years. Overall, while the sugar sector’s rebound in SSY26 reflects strong production fundamentals and improved cane recovery rates, the ethanol segment’s struggle with weak demand and export barriers underscores emerging structural challenges that could influence future investment and policy priorities in the sugar‑biofuel space.
