Sugar prices in India have surged by over 3% in the past two weeks, reaching their highest level in six years. Limited rainfall in key growing regions has raised concerns about production for the upcoming season, potentially leading to higher food inflation and discouraging the Indian government from allowing sugar exports. Higher prices will benefit sugar producers and improve their margins, helping them make timely payments to farmers. Output could fall by 3.3% in the new season starting from October 1st as low rainfall impacts cane yields in Maharashtra and Karnataka, which together account for over half of India’s total output. Indian prices are nearly 38% lower than the global white sugar benchmark. The price increase will likely prompt the Indian government to ban sugar exports in the new season, which would be the first time in seven years.