Resale sugar prices in India, particularly Karnataka and Maharashtra, dropped by ₹400-500 a quintal on Friday, following the government’s decision to permit import of 1 million tonnes of raw sugar.“There was no demand due to fears of heavy resale pressure on concerns over import of raw sugar. GST and Food Department officials have tightened their monitoring, while some traders indulged in profit booking,” an industry source told businessline.Resale sugar refers to sugar that traders or agents previously purchased from factories through tenders at ₹5,500 to ₹5,800 per quintal but have not lifted yet.“After tender rates exceeded ₹6,000, traders are selling this stock below Thursday’s market price following government orders on price control. They are doing this to quickly realise profits due to restrictions. Still, some mills have kept the open rate of more than ₹6,400-6,500,” said the source. Prices are under pressure, and there could be a further drop of ₹100-200 from the ₹400-500 a quintal witnessed in the morning. Retail rates ₹58.15/kgHowever, retail prices soared to a new high of ₹58.15 a kg from ₹55.7 on Friday. “The drop in resale sugar prices will be reflected from tomorrow, if not from Monday,” the source said, adding that State government and Food Department officials are intercepting vehicles for checking. “Warehouse inspection has begun in Karnataka and an unregistered warehouse has been sealed. Besides, bulk buyers are now offloading their stocks in the open market after the Centre tightened stock holding norms,” a milling source said.While allowing raw sugar import, the Government said in a notification that bulk buyers using over 10 tonnes of sugar a month cannot hold more than 15 days’ stock. This will be in force till November 30. Global prices dipGlobal sugar prices, too, dropped after the government announced the import of raw sugar. October raw sugar futures, which surged to 18.26 cents a pound soon after the announcement, dipped to 17.35 cents at 1830 hours IST. Raw sugar for cash was quoted at 17.5 cents. In London, white sugar slipped to $548 a tonne from a surge to $558 on Thursday. “Global prices were not expected to sustain as they factored in Indian imports,” said another trade source.On the other hand, the Ministry of Food asked all mills to furnish details of the sugar sold by them on August 17, 18 and 19. “This is to know who has bought sugar during these days and the volume purchased. The objective is to crack the whip if it suspects someone,” said Dilip S Patil, Managing Director of Samarth SSK Ltd and Co-Chairperson of the Sugar Bioenergy Forum (SBF) under the Indian Federation of Green Energy.DGFT normsLate on Thursday night, the Directorate-General of Foreign Trade came up with norms to import raw sugar. It said preference will be given to importers who undertake to bring in the consignments by October 15. It said for every 1.05 tonnes of raw sugar imported, the holder of tariff quota licence should produce 1 tonne of white sugar. Trade sources said nearly 4 lakh tonnes (lt) could reach the Indian shores within 45 days, with 3 lakh tonnes already on the way. Late on Friday, the government blamed sugar production being lower than initial estimates for the price surge. “Sugar production during the current season (October 2026-September 2027) is expected to be around 306 lt, compared to the initial estimate of around 343 lt by sugarcane-growing States,” it said.Ethanol not a reasonProduction was affected by Red Rot and Top Borer disease in sugarcane, as well as waterlogging caused by excess rainfall. “Despite the lower-than-estimated production, adequate sugar stocks are available in the country to meet domestic demand until the new crushing season begins in October,” it said, adding that sugar prices are rising globally too as the sugar deficit for 2026-27 is estimated at around 33 lt. It denied that sugar prices have surged due to diversion for ethanol. “The share of sugar diverted for ethanol has declined from around 12 per cent in 2022-23 to around 9 per cent in 2025-26. Moreover, nearly three-fourths of the ethanol produced in the country now comes from grains, particularly maize,” the government said in a statement. Another problem with supply and demand has been permitting exports. The government allowed 20 lakh tonnes of sugar for exports, but after 8 lakh tonnes were shipped, it barred shipments. India on Thursday allowed import of one million tonnes of raw sugar duty-free as part of its efforts to tame soaring sugar prices and food inflation.In a notification issued late evening, the Commerce Ministry said the imports would be allowed under a tariff rate quota (TRQ) regime. The imports will be allowed only till October 31, 2026.Published on August 21, 2026