Sugar Shortage in India? Balrampur Chini Mills Says Current Stock Sufficient Until November

Balrampur Chini Mills has reassured stakeholders that India faces no immediate risk of a sugar shortage, despite market volatility driven by concerns over deficient monsoon rainfall in key production hubs like Maharashtra and Karnataka. Pramod Patwari, Chief Financial Officer of the Kolkata-based sugar major, stated that current domestic inventory levels are sufficient to meet demand through October and the first week of November.

Addressing recent reports suggesting the government may restrict the diversion of sugarcane juice and B-heavy molasses toward ethanol production to boost sugar supplies, Patwari noted that the company has received no such official communication. Sugar Shortage Fears: Government May Curb Sugarcane Use for Ethanol As Prices Hit Record High.

"As of now, we have not heard anything from the government about this proposal," Patwari said. "However, the inventory position as of now is not that bad, given what is being discussed in the market. There is enough stock which will last till October or maybe the first week of November," he told CNBC TV18.

Monsoon Impact and Crushing Season Outlook

While sugar prices have risen by approximately 10 per cent over the last month, industry experts remain cautious about the impact of the monsoon on the upcoming 2026-27 sugar season. Patwari emphasised that it is "too early to take any call" regarding long-term supply deficits, noting that rainfall patterns in August and September will be the primary determinants for crop health. To mitigate potential supply tightness ahead of the festive season, the government is reportedly considering incentivising sugar mills to commence the next crushing season roughly 15 days earlier than usual. "We have also heard that the government is mulling over and may encourage sugar mills to start the crushing season early," Patwari noted. "That will result in the release of next year's production into the system," he added.

Ethanol Strategy and Financial Performance

Amid discussions regarding ethanol capacity and pricing, Balrampur Chini Mills is shifting its feedstock strategy. Patwari highlighted that current ethanol pricing renders production from sugarcane juice economically unviable. Consequently, the company intends to pivot toward grains. "At these prices of ethanol, making ethanol out of juice is totally unviable. Our endeavour would be not to produce any ethanol out of juice going forward," he stated, adding that the company expects to produce approximately 25 crore litres of ethanol in the 2026-27 ethanol year by increasing the proportion of maize and rice-based production. For the April-June quarter (Q1 FY27), the company reported revenue of INR 1,637 crore with a net profit of INR 44 crore and margins of 6.96 per cent. Looking ahead, the company is targeting 80 per cent capacity utilisation by FY28, with revenues projected in the range of INR 1,800–2,000 crore. FSSAI Proposes New School Food Rules: Check Threshold Limits for Fat, Sugar and Salt.

PLA Plant Implementation

The company also provided an update on its Polylactic Acid (PLA) bioplastics project, confirming that implementation remains on schedule. Commercial production is targeted to commence in December 2026. While the project is not expected to be a significant revenue contributor for FY27 due to initial quality stabilisation phases, management anticipates a "significant ramp-up" in FY28. Shares of Balrampur Chini Mills, which currently hold a market capitalisation of approximately INR 13,004 crore, have appreciated by over 9 per cent over the past year.

(The above story first appeared on LatestLY on Aug 12, 2026 02:31 PM IST. For more news and updates on politics, world, sports, entertainment and lifestyle, log on to our website latestly.com).