Duty-free raw sugar import window extended to 31 December

India has extended the window for duty-free imports of 10 lakh tonnes of raw sugar to 31 December from 31 October. A Directorate General of Foreign Trade (DGFT) notification issued on Wednesday moved the closing date¹. The quota was opened on 20 August, after domestic sugar prices hit record highs in August amid a fall in production¹.

Most of the quota is still on the table. The industry has imported only about 3 lakh tonnes of the 10 lakh tonnes allowed, according to The Economic Times, which cited industry sources¹. The report said government measures to keep domestic prices down had reduced the incentive to import¹. It did not name importers or set out how the quota has been split.

The import maths stayed unfavourable

Raw sugar is not ready for a bakery or a beverage line. Mills crush cane into raw sugar, which is then shipped to refineries that turn it into white sugar⁴. An import therefore competes with domestic white sugar only after refining and inland transport are added to the landed cost.

On 21 October, spot sugar sold at ₹5,145 a quintal in Kolhapur, ₹5,418 in Delhi and ₹5,775 in Chennai, GST included, according to ChiniMandi². In the global market the same day, US Sugar No. 11 for March 2027 was quoted at 20.41 cents a pound and London Sugar No. 5 for December at $545.00 a tonne².

The government has also moved sugar out of the fuel pool. The oil marketing companies' tender of 16 October for the 2026-27 ethanol supply year sought no ethanol made from sugarcane juice, sugar syrup or B-heavy molasses. The tender document said sugar diversion for ethanol would be "reduced to zero"⁵. That leaves more sugar for food. But ISMA, the sugar and bio-energy manufacturers' body, has warned that restricted access to ethanol procurement deprives mills of an important revenue stream. It also weakens their ability to pay cane dues on time⁶. ISMA wants the C-heavy molasses rate raised to ₹62.23 a litre from ₹57.97⁶.

Grain-based producers took a cut too. Oil marketing companies lowered the maize ethanol price to ₹68.86 a litre from ₹71.86, and the maize incentive to ₹2.79 a litre from ₹5.79⁵. BusinessLine reported the maize reduction as ₹3 a litre and said the sugar industry welcomed it⁶.

A smaller crop and a higher floor

Industry expects output in the 2026-27 season, which runs from October to September, to be lower than last year because of an El Niño drought¹. The World Meteorological Organization said Pacific sea-surface temperatures could reach 3.8°C above average between November and January⁷.

In Karnataka, cane farmers suspended their agitation after talks with Food Minister Pralhad Joshi and set 26 November as a new deadline for the Centre³. They want the fair and remunerative price (FRP) raised to ₹4,500 to ₹5,500 a tonne. The Centre has fixed ₹3,650 a tonne for 2026-27. The farmers also want the sugar minimum selling price (MSP) lifted to ₹60 a kilogram from ₹31³. The Centre has set up a committee under Ramesh Chand, a former NITI Aayog member, to examine the demands³.

Chief Minister D.K. Shivakumar has written to the Prime Minister asking for an early MSP revision and a return of the FRP base recovery to 9.5% from 10.25%³. "FRP is reduced when recovery falls below this base, but sugar recovery depends on soil, climate and the time of crushing, which the farmer does not control," he said³.

Retail prices show the pressure. All-India sugar inflation was 4.92% in July, over 24% in August and around 30% in September, according to a BusinessLine analysis of CPI micro data⁸.

What to watch before 31 December

The extension keeps an unused quota open. It does not add volume beyond the 10 lakh tonnes first allowed in August¹. Buyers should watch whether cargoes are actually booked before the new deadline, and whether an allocation list naming mills or importers is published, since the ET report carried none¹.

The MSP review and the Ramesh Chand committee matter too, because they set the floor under mill prices for the new season³. Spot prices fell on 21 October in Delhi, Kanpur, Kolhapur, Kolkata, Muzaffarnagar, Ahmedabad and Bengaluru, and were unchanged in Chennai². Delhi's M/30 grade fell ₹126 a quintal that day and Kanpur's fell ₹105².