India's sugarcane growers struggle due to El Niño, sugar prices rise

India's sugarcane growers are currently facing a severe crisis due to adverse weather and increasing costs. According to a report by ABC News, the record-breaking 'El Niño' weather system has caused warm conditions in the Pacific Ocean, resulting in a weakened monsoon season. Due to a severe lack of rain in July and August, sugarcane crops have not received proper growth, which has directly impacted production and quality.

Failvan Venkatesh, a 63-year-old farmer cultivating on the outskirts of Mysuru city in Karnataka, expressed concern that sugarcane stalks are thin this year and break easily. He stated, "There is hardly anything in this sugarcane crop." The situation has become more difficult for farmers as fertiliser prices have risen due to global conflicts, forcing farmers to incur higher expenses.

India is the world's second-largest sugar producer and also the largest consumer. Kurubar Shanta Kumar, president of the Karnataka State Sugarcane Growers Association, stated that sugarcane production has decreased by 9 million tonnes this year compared to last year. Highlighting the dependence on nature, he said, "We cannot grow sugarcane on a computer or take a harvest on a computer."

Bhargavi Bhardwaj, a food system risk expert at Chatham House, stated that India's sugar production has not completely collapsed, but stress has increased due to uncertainty. She explained that the immediate effect of climate change is often seen as a price shock rather than a physical shortage, which can pose a risk to food affordability and economic stability.

According to data from India's Department of Consumer Affairs, sugar prices increased by more than 30 per cent in August compared to July. These difficulties come after problems caused by excessive rainfall in 2025, where heavy rains led to the spread of pests and crop diseases. Bajaj Hindusthan Sugar, one of India's largest sugar factories, reported that sugar production decreased by approximately 11 per cent in the last financial year.

Recent data from the United Nations Food and Agriculture Organization shows that global sugar prices increased by 6.6 per cent in October. This is the fourth consecutive monthly increase and has reached the highest level since April last year. According to an analysis by ANZ Bank, the rising price of sugar and high cocoa prices have made the production of chocolate and candy more expensive, which could lead to a jump in retail prices.

On the other hand, according to a report by the US Department of Agriculture, Australian sugarcane growers have been less affected by dry conditions and may benefit from sugarcane with higher sugar content, which could increase overall production.

To address this situation, the Karnataka state government is providing financial assistance of approximately 50 million dollars to farmers and is giving an additional 1.70 dollars per tonne of sugarcane supplied to mills. The central government has removed tariffs on sugar to increase supply and reduce prices before the Hindu festival season, allowing up to 1 million tonnes of sugar to be imported duty-free by the end of the year. Additionally, a ban has been imposed on the use of sugar for producing ethanol. Nevertheless, the impact of price hikes has begun to affect businesses.