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14 states and Union Territories with a huge sugar consumption base are currently facing supply shortage due to low output last year. The government has asked Indian Sugar Mills Association (ISMA) to ensure that Mills do not increase prices as market prices were quoted at three-month highs. In response to the letter from ministry of consumer affairs to check prices.

National Federation of Cooperative Sugar Factories has asked sugar mills to advance the cane crushing operations for 2017-18 (Oct-Sep) to early or mid-October to maintain adequate supply of sugar in the market. Mills start crushing cane by the end of October or the beginning of November. Demand for the sweetener is expected to rise significantly during major festivals starting from Rakshabandhan on Aug 7 and continuing till Christmas on Dec 25. Early crushing “would help availability of new sugar production to augment stock availability in the market which would help maintain current level of sugar prices. The sugar body had asked mills to offload maximum stocks to help curtail the soaring prices.

The country raw sugar output in the current crop year has already reached 2.485 million metric tons (MMT), 11.03 percent higher than the 2.238 MMT recorded in crop year (CY) 2015-2016. Sugar Regulatory Administration (SRA) showed that the local sugar industry has produced 49.691 million 50-kilogram bags. Sugar production SRA revised target of 2.5 MMT for CY 2016-2017, which end on August 31.

USDA announced that it is opening up the U.S. market to an additional 414,000 tons of foreign sugar. The move was greeted warmly by the by U.S. food and candy makers, who have been clamoring for months for the USDA to allow in more sugar. The U.S. needs more sugar than it produces, but USDA tightly controls imports through a complex TRQ system. USDA each year sets an overall sugar import quota for 40 World Trade Organization countries, not including NAFTA partonneer Mexico. That quota for raw sugar is about 1.2 million tons and currently cannot be raised each year until April 1. The increase announced bring that up to roughly 1.5 million tons for fiscal year 2017, not including the sugar that Mexico is allowed to ship here.

The decision was taken to allow the export under certain conditions to avoid the escalation of prices of sugar in the domestic market. The export of 0.3 million tonnes of sugar in addition to the quantities already allowed for export by the ECC. The Pakistan Sugar Mills Association (PSMA), in May 2017 had informed the government that the sugar industry had produced record quantity of sugar leading to a surplus of 1.475 million metric tonnes which was resulting in the delayed payment to the sugarcane growers. The mill owners are unable to pay the due amount because of the financial crunch faced by the industry and its poor liquidity position. There is a strong need to overview the sugar stock situation and accordingly enhance the export quota. This facilitate the mills to pay farmers outstanding dues and commence the 2017-18 crushing season on time.

China sugar imports plunged in June, after Beijing imposed hefty tariffs on foreign arrivals in late May and slashed imports permits. China bought 140,000 tonnes of raw sugar in June, down 62 percent year on year, and down 25 percent from last month 186,765 tonnes. China has halved the permits for out-of-quota sugar import from last year to around 1 million tonnes. Beijing imposed extra tariffs on out-of-quota imports of the sweetener for the next three years in a ruling in May, following years of lobbying by domestic sugar farmers and crushers. Imports in the first half of this year went up 5.9 percent to 1.41 million tonnes, as lower global prices attracted buyers.