Patna: Sugar prices have surged sharply across Bihar, with retail prices rising to Rs 65-70 per kg in several markets, compared with around Rs 48 per kg three weeks ago. In some districts, prices have crossed Rs 70 per kg, adding to concerns among consumers ahead of the festive season.
The price rise has been attributed to a combination of factors, including lower sugar production, limited market availability, concerns over stocks, increased festive demand and the diversion of sugarcane molasses for ethanol production.
Bihar is not self-sufficient in sugar production. The state produced around 5.85 lakh tonnes of sugar in 2025-26, against annual consumption of more than 7 lakh tonnes. The gap means Bihar has to source sugar from other states to meet its domestic requirement.
According to central government data, the average retail price of sugar across India stood at Rs 48.18 per kg on July 20, but increased to Rs 55.70 per kg by August 20. In Bihar, prices in several markets have risen significantly more, with sugar selling for around Rs 65-70 per kg in Patna, Bhagalpur, Siwan and Sasaram. Prices of Rs 68-74 per kg have also been reported in some districts.
Why are sugar prices rising?
One of the factors being cited behind the pressure on sugar availability is the use of sugarcane molasses for ethanol production.
Bihar’s sugarcane production declined from 121.49 lakh tonnes in 2024-25 to 110.32 lakh tonnes in 2025-26. Of the total production last year, around 56.90 lakh tonnes, or 51.57%, reached sugar mills.
The mills produced approximately 5.85 lakh tonnes of sugar during 2025-26. At the same time, around 1.2485 lakh tonnes of sugarcane molasses suitable for sugar production were diverted for ethanol manufacturing.
Sugarcane-derived ethanol accounted for about 9.01% of Bihar’s total ethanol production, according to the data cited in the report.
However, ethanol production is only one factor behind the recent price increase. The decline in sugarcane production, the state’s structural production deficit, festive demand and concerns over market stocks have also contributed to the upward pressure on prices.
Bihar’s sugar production fluctuates
Bihar’s sugar production has remained uneven over the past decade.
The state recorded its highest production during 2018-19, at around 8.41 lakh tonnes. Production subsequently declined to 4.75 lakh tonnes in 2020-21 and further to 4.57 lakh tonnes in 2021-22.
Production recovered to around 6.89 lakh tonnes in 2023-24, before declining again to approximately 5.85 lakh tonnes in 2025-26.
For 2025-26, the state had set a sugar production target of around 6 lakh tonnes.
Bihar produces 110-120 lakh tonnes of sugarcane annually
Sugarcane is cultivated on around 2.25 lakh hectares in Bihar. The state generally produces around 110-120 lakh tonnes of sugarcane annually.
However, the entire crop does not reach sugar mills. Around half of the sugarcane is used for making jaggery and for other purposes, while the portion supplied to sugar mills is processed into sugar.
Sugarcane productivity varies considerably across districts.
West Champaran is one of the state’s major sugarcane-producing areas. In 2023-24, around 8,530 hectares were under sugarcane cultivation in Begusarai, where productivity was approximately 97.21 tonnes per hectare.
In 2022-23, sugarcane productivity reached 107.04 tonnes per hectare in Madhubani and 105.37 tonnes per hectare in Samastipur.
In Muzaffarpur and Vaishali, productivity was around 34.86 tonnes per hectare in 2022-23, increasing to approximately 37.38 tonnes per hectare in 2023-24.
Plant crop performs better than ratoon crop
The state’s sugarcane data also point to the potential for increasing productivity through improved cultivation practices.
A newly planted sugarcane crop is known as a plant crop, while the crop that grows again from the same roots after harvesting is called a ratoon crop.
Data from West Champaran indicate that plant crops have recorded higher production than ratoon crops. Experts and officials see scope for improving overall productivity through better-quality planting material, improved varieties, irrigation and scientific farming practices.
Bihar has 11 sugar mills, 10 operational
Bihar currently has 11 sugar mills, of which 10 are operational and one is closed.
During 2023-24, operational mills crushed around 67.72 lakh tonnes of sugarcane and produced approximately 6.87 lakh tonnes of sugar.
Major sugar mills in the state include those in Harinagar, Bagaha, Narkatiaganj, Majhaulia, Gopalganj, Sidhwalia, Hasanpur, Lauria and Sugauli.
The mills are also facing a shortage of sugarcane. During 2025-26, Bihar’s sugar mills operated for an average of around 97 days, against a target of approximately 150 days for the crushing season.
22 ethanol distilleries operational in Bihar
Bihar’s ethanol industry has expanded significantly in recent years.
As of August 2026, ethanol production was taking place at 22 distilleries in the state. Of these, 14 are grain-based and eight are molasses-based.
Grain-based distilleries primarily use grains such as maize to produce ethanol, while molasses-based plants use molasses obtained from sugarcane processing.
Government plans to expand sugar industry
The Bihar government is preparing plans to expand the state’s sugar industry and increase production.
Apart from existing mills, proposals are being prepared for more than 20 new sugar mill projects across various parts of the state, including districts in north, central and south Bihar.
The proposed projects are expected to integrate sugar production with ethanol, electricity generation and compressed biogas (CBG). The broader objective is to develop an integrated sugarcane-based industry rather than focusing only on sugar production.
Four new sugar mill complexes planned
Prime Minister Narendra Modi is expected to lay the foundation stones for four new sugar mill complexes at Motipur, Raiyam, Sakri and Sasamusa.
The proposed complexes are planned to produce sugar, ethanol, electricity and compressed biogas (CBG), allowing greater utilisation of sugarcane and its by-products.
Each complex is expected to have a sugar production capacity of around 5,000 metric tonnes. Production could begin within the next three years once the projects are implemented.
Sugarcane crushing may begin from October
The state government is preparing to begin the upcoming sugarcane crushing season earlier than usual, with operations likely to start in October.
Sugarcane crushing generally begins in November and continues until March or April.
To improve sugarcane productivity, the government is also promoting modern nurseries. Under the 2026-27 sugarcane nursery scheme, farmers and nursery operators adopting the single-bud plantlet technology can receive subsidies of up to 75%, with maximum assistance of Rs 11.25 lakh.
Modern nurseries are being developed with the capacity to produce around 5 lakh plantlets annually. The objective is to provide farmers with disease-free and quality planting material and improve sugarcane yields.
With Bihar continuing to consume more sugar than it produces, the state’s ability to increase sugarcane productivity, expand milling capacity and balance sugar production with ethanol manufacturing will remain crucial to controlling prices and reducing its dependence on supplies from outside the state.
