The 20 per cent ethanol-blended petrol not only brings down your car mileage but also affects sugar prices, especially in a tight market, which straightaway adds to the government mismanagement quotient because the much-vaunted savings in import of crude were prioritised thus affecting the dynamics of food production. The drop in mileage might also mean that more crude would have to be imported thus defeating the arguments for the E-20 mix, but that is another matter altogether. — DC Image

Sugar has an important part to play in the lives and lifestyles of Indians. Millions of diabetics, moms who are trying to wean children off high sugar diets and fitness fanatics who follow strict regimens based on dietary guidelines may make a sizeable segment who might view refined sugar in an entirely different light.

For a billion others, at least ‘thoda mitha’ in almost everything is the norm, be it a celebratory occasion with sweetness conferring a symbolic blessing or just people gorging on sweetmeats. What is not so sweet this season, however, is the price of sugar that has shot up nearly 40 percent.

Blaming the dramatic price rise on a poor monsoon for agriculture thanks to the El Nino effect or the pests that get at the crop is based on facile assumptions. However, it is the government that must take the major blame for misjudging the sugar crop this year to the extent that it had to take drastic U-turns, from allowing sugar exports based on expectations of good production to permitting import of a million tonnes free of duty before October 31.

The government is not in the business of growing sugar but it must take the blame for the current situation since it controls almost everything else — from ordering how much will go to the market, how much stockholding is permitted, how much can be exported to how much can be diverted for ethanol production.

The contrast is noticeable in a market that was supposed to have enough to permit diversion to exports and ethanol, besides allowing two million tonnes for export to one where the authorities are worried about releasing a higher quota to the market in the festive season that begins with Onam and runs into the New Year with the next major harvest season.

The government may have been misled by over optimistic forecasts of sugar output by industry bodies at the beginning of this sugar season last year, but then it claims that it has its own agencies guiding it in the matter of assessing national output before taking a call on exports. The July 2025 outlook by a sugar manufacturing association weakened with time and the projected production fell by more than six million tonnes after 2.4 million tonnes were said to have been diverted to ethanol.

The 20 per cent ethanol-blended petrol not only brings down your car mileage but also affects sugar prices, especially in a tight market, which straightaway adds to the government mismanagement quotient because the much-vaunted savings in import of crude were prioritised thus affecting the dynamics of food production. The drop in mileage might also mean that more crude would have to be imported thus defeating the arguments for the E-20 mix, but that is another matter altogether.

What the sugar crisis of 2026, which will spill over into next year as the opening stock for the new sugar season is likely to be lesser than in Oct. 2025, portrays is that excessive government control in anything leads to even more problems than what market forces may bring, including its perennial habit of speculative hoarding of stock.

Emergency relief measures like the ordering of an additional 10 lakh tonnes of sugar is not a band-aid solution. But the sugar situation that is threatening to turn bitter this season must serve as a lesson for the government to be far more proactive in getting its numbers right and planning smartly in a commodity that is also tied to India’s cultural roots. There is a lot to learn from the failures on the sugar front, for the government as well as the market.

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