India, the world’s second-largest sugar producer, is expected to confront a significant shortage in sugar output due to inadequate rainfall this crop year. Traders and a farmer survey suggest that this shortfall could cause the country to lag behind its sugar consumption for the first time in seven years, potentially leading to import requirements in the upcoming year. The lower cultivation of sugarcane in major producing states, Maharashtra and Karnataka, is a driving force behind this decline.

The insufficient rainfall has resulted in reduced water levels in key reservoirs, compelling farmers to opt for crops that demand less water and mature quicker than sugarcane. This shift towards crops like sorghum and chickpeas is highlighted in a survey of over 200 farmers conducted by Reuters. As a consequence, India might witness a decline in sugar production not only in the ongoing crop year but also in the subsequent year until September 2025. This scenario poses a threat, pushing India, which contributes 12% to global sugar trade, into becoming a net importer as early as the first half of 2025, marking a significant reversal from its exporting status. The impending sugar shortage in India due to lower yields and water scarcity in crucial cane-growing regions like Maharashtra and Karnataka may force the country to import sugar for the first time since 2017. The reduced production forecast could result in increased global sugar prices, benefiting top exporter Brazil. The government’s response to these forecasts remains pending, but the industry anticipates a decrease in sugar production compared to the previous year, creating a potential need for imports to meet domestic demands.