The Food and Consumer Affairs Ministry has announced strict penalties for sugar mills that violate monthly stock holding limits. The revised rules, effective from April 1, 2025, are aimed at curbing hoarding and stabilising prices in the domestic sugar market.
April Quota Fixed at 2.35 Million Tonnes
To manage supply, the ministry sets monthly stock limits for white and refined sugar. For April 2025, the cap has been set at 2.35 million tonnes. However, repeated violations by both group-owned and individual sugar mills have prompted the government to take firmer action.
Progressive Penalties for Repeated Violations
Under the new directive, first-time violators will see 100% of the excess sugar sold deducted from their next month’s quota. Penalties will increase for repeated offences:
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115% deduction for a second violation
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130% for a third
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150% for a fourth
Mills dispatching less than 90% of their allotted quota without prior intimation will also face future allocation restrictions.
Disqualification from Government Schemes
Sugar mills committing multiple violations in a sugar season will lose eligibility for additional releases and government scheme benefits.
“No benefit under any scheme of DFPD and DSVO, including export quota, as and when issued, may be granted to the sugar mills which violate stockholding limit orders more than two times in a sugar season, starting from the month of third instance,” the directive stated.
Impact on Ethanol Procurement and Industry Compliance
Ethanol procurement allocations may also be reduced for non-compliant mills. The ministry plans to redistribute deducted quotas among mills that have adhered to stock limit orders, encouraging industry-wide compliance.
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A Move to Safeguard Supply and Price Stability
These enforcement guidelines are designed to ensure a consistent sugar supply and curb price manipulation. The government’s intent is clear: promote fair trading practices, ensure availability, and protect consumer interests in the face of persistent violations.
