SF Prep Notes

Centre steps in to curb sugar prices before festive season

The Centre on 21 August 2026 set out steps to cool sugar prices, which rose from ₹48.18 to ₹55.70 a kg in a month, including dealer stock limits and duty-free import of 10 LMT of raw sugar.

Summary

The Ministry of Consumer Affairs, Food and Public Distribution said on 21 August 2026 that retail sugar prices rose from ₹48.18 per kg on 20 July to ₹55.70 per kg on 20 August 2026. The ministry said ethanol diversion was not the cause, as its share fell from about 12% in 2022-23 to about 9% in 2025-26; it blamed lower output (about 306 LMT against an initial estimate of 343 LMT, hit by red rot, top borer and waterlogging), festive demand, tighter global supply and hoarding. Measures include a 400-tonne stock limit on dealers from 1 August to 30 November 2026, a 15-day stock cap on bulk consumers from 1 September, joint stock checks at mills, duty-free import of 10 LMT of raw sugar, and an early crushing start from 15 October.

Key facts

Price rise
₹48.18/kg (20 Jul) to ₹55.70/kg (20 Aug 2026)
Output
~306 LMT vs initial estimate ~343 LMT
Dealer stock limit
400 tonnes, 1 Aug–30 Nov 2026
Bulk consumers
Max 15 days' stock from 1 Sep
Import
Duty-free 10 LMT raw sugar
Crushing
Advised to begin from 15 Oct 2026

Practice MCQs 3 questions

Q1

What stock limit did the Centre impose on sugar dealers from 1 August to 30 November 2026?

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Correct answer: C — 400 tonnes

A stock limit of 400 tonnes was imposed on sugar dealers across the country from 1 August to 30 November 2026.

Q2 Advanced

To improve sugar availability in 2026, the Centre permitted duty-free import of how much raw sugar?

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Correct answer: A — 10 LMT

As a precaution, the government permitted duty-free import of 10 lakh metric tonnes (LMT) of raw sugar.

Q3 Advanced

Consider the following statements about the Centre's August 2026 note on sugar prices: 1. The government attributed the price rise mainly to diversion of sugar for ethanol. 2. Sugar production this season is expected to be about 343 LMT. Which of the above is/are correct?

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Correct answer: D — Neither 1 nor 2

Both are wrong. The government said ethanol diversion was not the cause (its share fell to about 9%), and output is expected at about 306 LMT; 343 LMT was the states' initial estimate.

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