India’s sugar exports have slowed sharply after shipping routes in West Asia were disrupted due to the ongoing conflict involving the United States, Israel and Iran. The closure of the Strait of Hormuz has affected maritime trade, creating uncertainty for the country’s sugar industry and raising concerns about rising stock at sugar mills, ETV Bharat reported.
The centre had allowed exports of 2 million metric tonnes of sugar for the 2025-26 season. However, only about 300,000 to 400,000 tonnes have been shipped so far. With shipping operations affected, industry observers fear that nearly 1 to 1.2 million tonnes of sugar may remain unsold for export.
In November 2025, the Ministry of Consumer Affairs, Food and Public Distribution had announced an export quota of 1.5 million tonnes for the season. The government later permitted an additional 500,000 tonnes in February 2026. The quota was distributed among sugar mills based on their average production over the past three seasons, but the war-related disruption has slowed down shipments.
India’s sugar production for the current season is estimated at around 29.3 million metric tonnes, while domestic consumption is about 28.5 million tonnes. In Maharashtra, 210 sugar mills crushed more than 101 million tonnes of sugarcane and produced about 95.69 million quintals of sugar. In the Kolhapur Division, all 39 sugar mills have already completed the crushing season and closed operations.
Sugar expert Vijay Avatade from Kolhapur said the halt in exports could affect domestic prices. He said the inability to export sugar would increase stock at mills, which may push prices down in the local market. While farmers may not face direct losses because the Fair and Remunerative Price for sugarcane is legally fixed, delays in payments could occur if mills face financial pressure.
Shipping activity has been affected after the Islamic Revolutionary Guard Corps announced the closure of the Strait of Hormuz on March 2, 2026, disrupting nearly 70 percent of vessel movement through the route. Trade through the Suez Canal has also been impacted, while rising insurance costs and security concerns have forced several shipping companies to cancel bookings.
Global sugar prices are currently around ₹3,600 to ₹3,700 per quintal, but higher freight costs have made exports difficult. The Directorate General of Foreign Trade had earlier announced a tariff-rate quota of 5,841 tonnes for exports to the European Union, though the conflict has slowed overall shipments.
Farmer leader Umesh Deshmukh of the Akhil Bharatiya Kisan Sabha said the disruption in exports has created uncertainty for the agriculture sector. If sugar stocks rise in Maharashtra due to stalled exports, domestic prices may weaken in the coming months, he said, urging the central government to intervene and ensure alternative export routes.
Industry observers say that while the situation could create challenges for sugar mills, it may also lead to higher availability of sugar in the domestic market. They added that the government may need to consider flexible export policies, explore alternative shipping routes and extend temporary support to mills if the disruption continues.
