ndia’s sugar production has declined by 16% year-on-year to 9.5 million metric tons since the season began in October 2024 due to a dip in output in its leading sugarcane-producing state, according to the Indian Sugar & Bio-Energy Manufacturers Association (ISMA).

Weather conditions have impacted production in Maharashtra, the country’s biggest producer and in some other states, which could reportedly affect exports from the world’s second-largest sugar producer toward the end of the season in September 2025.

According to ISMA, sugar consumption is also likely to decrease by 5% year over year. The domestic sales quota for the first four months of this year is 0.7 million metric tons lower than last year’s. An absence of major events has been cited as a reason for the drop.

“Consequently, ISMA estimates that with an average domestic monthly consumption of 2.35 million [metric] tons over the remaining eight months, the total domestic consumption for the sugar season 2024-25 is projected to be lower at around 28 million [metric] tons,” says the organization on its website. 

India’s key role in sugar 

Along with Brazil, the world’s biggest sugar supplier, India’s output significantly impacts global sugar market performance and pricing. ING reported late last year that prices had held up due to concerns over Central-South (CS) Brazil crop supply and positive projections for Indian crops.

“This has been largely due to concerns over the CS Brazil crop, wher drought conditions and fires in cane fields raised risks not only for the 2024-25 crop but also the 2025-26 crop. Rainfall more recently has eased some concerns for the next crop,” writes Warren Patterson, head of commodities strategy at ING in a recent article on global sugar surplus.

“However, the expected size of the surplus has fallen as we have moved through the year, with the global market now expected to see a surplus of a little over 4 million metric tons in 2024-25.”

He also suggests that the size of the Indian crop will be important in determining whether the government will allow sugar exports this season.

A crop toward the lower end of the range would reduce the probability or at least push back the export potential until much later in the season once there is complete clarity on domestic supply.

Patterson adds: “The government also wants to ensure that there is enough supply to hit its 20% ethanol blending mandate by 2025. While theoretical (given the government has not issued export quotas), the export parity for Indian sugar is wide open.”

The global sugar market can be volatile owing to unpredictable climate conditions, agricultural practices and production cycles. According to USDA figures, world sugar production for 2024-25 is expected to jump by 2.8 million metric tons to 186.6 million, with higher production in China and Thailand offsetting an anticipated lower production in Brazil.