Sugar stocks surge up to 10% on rising domestic prices and tight supplies

Sugar stocks rallied sharply on Wednesday, with several producers gaining between 5% and 10% even as the broader market remained weak.

Bajaj Hindusthan Sugar, Dwarikesh Sugar Industries and Shree Renuka Sugars were among the top gainers, as investors bet on stronger realisations for mills amid a sharp jump in domestic sugar prices. Wholesale prices in key trading hubs such as Kolhapur have climbed nearly 20% since the start of August, touching record levels around ₹5,350 per 100 kg. The surge stems from tightening inventories, lower-than-expected production in the previous season, and anticipatory buying ahead of the festival demand period from August to November. Mills have been releasing stocks gradually, supporting higher prices. At the same time, the government is examining measures to ease supply pressures and curb potential inflation. These include limited duty-free imports, tighter stockholding limits for bulk traders, and adjustments to monthly sale quotas for mills. One proposal under discussion involves allowing up to 1 million tonnes of duty-free imports before the end of October.