ISMA Calls for Urgent MSP Revision to Stabilize India's Sugar Sector

The Indian Sugar & Bio-Energy Manufacturers Association (ISMA) has issued a strong appeal to the government, urging a revision of the Minimum Selling Price (MSP) of sugar. Deepak Ballani, Director General of ISMA, emphasized the necessity to raise the price to at least Rs 40.2 per kilogram, an increase of approximately Rs 9 from the current rate, for the 2025-26 sugar season.

Ballani noted that since February 2019, the MSP has stagnated at Rs 31 per kilogram, even as the Fair and Remunerative Price (FRP) of sugarcane has consistently climbed yearly. This discrepancy has broadened the gap between input costs and output pricing, prompting Ballani to call for an automatic alignment of the MSP with sugarcane FRP to preserve mill operations and secure timely payments to farmers.

ISMA's proposal arises from escalating sugarcane costs, the chief raw material, and diminished sugar recovery rates, which have collectively elevated sugar production costs. To avert financial distress for mills and safeguard the timely payment of cane dues to farmers, ISMA advocates for a rise in MSP. Notably, the FRP for sugarcane has surged 29% since the 2018-19 season, hitting Rs 355 per quintal for 2025-26, whereas the MSP has remained unchanged.

ISMA has also issued a warning: without an MSP revision and adjustments to ethanol prices, sugar mills could face severe financial challenges. This precarious situation endangers mill viability and could lead to payment delays to farmers, posing a threat to the industry's stability. The association advises implementing an automatic linkage mechanism between sugarcane FRP and sugar MSP to ensure timely adjustments and prevent future mismatches, which is crucial for protecting farmer incomes, maintaining mill operations, and ensuring industry stability.

According to ISMA, sugar production is projected to reach 34.90 million tonnes in the 2025-26 season, supported by improved yields in key states like Maharashtra, Karnataka, Uttar Pradesh, and Tamil Nadu. This projection suggests stability in sugar output expectations despite regional variances, with the association planning to reassess crop conditions and release its first advance estimate in October/November 2025.

The country's sugar exports are anticipated to rise to around 2 million tonnes this year, up from 0.8 million tonnes previously, driven by a likely bumper crop and surplus domestic stocks. (ANI)