Shree Renuka Sugars, Dalmia Bharat: Sugar stocks sweeten after government approves additional export quota

Shares of sugar manufacturers such as Rajshree Sugars, Gayatri Sugars, Shree Renuka Sugar, Bajaj Hindusthan, EID Parry, Mawana Sugar and Rana Sugars rose between 2% and 7% on Tuesday, March 17, after government approved additional export quota of 87,587 tonnes of sugar for the 2025-26 marketing year (October-September), following requests from sugar mills, the ministry said in a circular on Monday.

These stocks have also been witnessing heightened buying interest on expectations of higher ethanol blending as crude supplies are facing disruptions owing to geopolitical tensions in the Middle East, analysts noted.

The government had earlier permitted exports of 1.5 million tonnes for the season, and in February allocated an extra 500,000 tonnes to willing mills on a non-swappable basis, news agency Press Trust of India reported.

Mills had until February to apply for portions of the additional quota. Of the 500,000 tonnes, only 87,587 tonnes were requested and approved, with the remainder lapsing, the ministry stated.

Mills must export the allocated sugar by June 30, 2026. Those exporting at least 70 per cent of their quota by that date will be allowed to ship the balance by September 30, 2026. Failure to meet the 70 per cent threshold will result in the unutilised quantity lapsing, with potential reallocation to higher-performing or willing mills.

No extensions will be granted except in force majeure cases. The quota cannot be swapped between mills.

Mills failing to export the mandated 70 per cent will face deductions from future export quotas equivalent to the shortfall below the threshold.

For instance, a mill allocated 1,000 tonnes exporting only 400 tonnes by June 30 would see a 300-tonne deduction applied to its next allocation.

All grades of sugar may be exported up to the allocated limit. Refineries exporting refined sugar from raw sugar supplied by mills can do so under bi- or tri-partite agreements, provided quantities remain within the original mill's quota.

India has exported 315,000 tonnes of sugar from October to February in the 2025-26 season against a total permitted quota of 1.5 million tonnes, according to recent industry data.

As of 11:00 am, sugar shares were outperforming the benchmark NIFTY50 index which was down 0.1%.