Sugarcane Cultivation in India

Second only to Brazil

India is the world’s second-largest producer of sugarcane, after Brazil. The crop covers about 5.4 million hectares nationally, and recent seasons have produced around 878 lakh tonnes.

Uttar Pradesh and Maharashtra out front

Uttar Pradesh and Maharashtra together lead India’s sugarcane production, followed by Karnataka and Tamil Nadu. Maharashtra runs more sugar mills than Uttar Pradesh, but Uttar Pradesh’s cane recovers a higher share of sugar per tonne crushed.

From CACP study to CCEA approval

The Fair and Remunerative Price is the statutory minimum a mill must pay a farmer for sugarcane. The CACP studies farming costs. It then recommends a price. The CCEA approves that price. The Prime Minister chairs the CCEA. This whole process sits under the Sugarcane (Control) Order 1966. That order draws its power from the Essential Commodities Act 1955.

For the 2026-27 season, the CCEA approved an FRP of ₹365 per quintal at a base recovery rate of 10.25%.

Beyond direct sett planting

Farmers traditionally grow sugarcane from setts. A sett is a stem cutting, planted directly in the field. Two newer methods now supplement this. The bud-chip settling method raises single-bud chips in a nursery first. Growers then transplant them. This saves seed compared with direct sett planting. Tissue-culture settlings, grown in a lab, offer a third route.

Juice, syrup, and molasses all convert to ethanol

Sugarcane feeds India’s ethanol programme through three separate intermediate products: cane juice, cane syrup, and molasses left over from sugar milling. All three can be converted into ethanol for blending with petrol. See the EBP Programme article for how that blending target is tracked nationally.

A pioneer loses the lead

Sugarcane pioneered India’s role as an ethanol feedstock. It did this through molasses-based distilling, long before today’s Ethanol Blended Petrol Programme scaled up. By 2024-25, maize had overtaken sugarcane as India’s single largest ethanol feedstock. In ethanol supply year 2023-24, maize alone supplied a large share of total ethanol output. That put it ahead of both sugarcane and rice.

India reached 20% ethanol blending in January 2026, five years ahead of the original 2030 target, with maize now carrying much of that load alongside sugarcane.

Why sugar counts as an agro-based industry

Sugarcane links farms to factories in both directions. This makes sugar a classic agro-based industry, one built on farm produce as its raw material.

The backward linkage runs from the mill to the farmer. A mill needs cane grown within a fixed radius of its own gates, since cut cane loses sugar content fast. Mills also run cane-development programmes, supplying seed setts and extension advice to nearby growers.

The forward linkage runs from the mill outward to several products, not just sugar. Molasses, left over after milling, becomes ethanol for the blending programme. Bagasse, the crushed fibrous stalk, fuels boilers and cogenerates surplus power for the state grid. Press mud, another leftover, becomes organic fertiliser.

Curbing speculative sugar trades

On 28 July 2026, the government imposed stock-holding limits on sugar dealers nationwide. These limits run from 1 August to 30 November 2026. The move responded to concerns over speculative “paper trades” in the sugar market.

A surplus call that flipped

In November 2025, the government allowed sugar exports of 1.5 million tonnes for the 2025-26 season, on an expectation of surplus output. By early May 2026, authorised exports had risen to about 1.59 million tonnes. Roughly 0.8 million tonnes had already shipped by then.

Soon after, the government halted exports as production estimates fell short. Domestic stocks tightened further. On 21 August 2026, the government approved duty-free imports of up to 1 million tonnes of raw sugar. Only companies with their own refining capacity could apply, in a window open from 21 to 28 August. Any sugar refined from that quota had to be sold within India by 31 October 2026.