India’s festive season is approaching, but sugar prices are creating fresh concerns. In July, sugar prices increased 2.73% compared with the previous month. This rise exceeded the country’s overall retail inflation increase of 0.9%.
According to Moneycontrol, sugar prices climbed faster in July than previous months. During June, prices increased 0.63%. Meanwhile, May recorded a 0.44% rise. Earlier, April saw only a 0.09% monthly increase.
Additionally, sugar became 4.92% costlier in July compared with last year. In June, annual sugar inflation stood at 2.17%. Therefore, July recorded a significant jump within one month. Sugar inflation also crossed the overall retail inflation rate of 4.44%.
Higher Sugar Rates Impact Jaggery and Sweets
Currently, sugar prices have crossed ₹60 per kilogram. In July, rates remained around ₹48 per kilogram. However, sugarcane sowing until August 31 stayed only 0.5% lower than last year.
Meanwhile, rising costs have affected jaggery and sweets as well. Jaggery prices increased 1.76% in July compared with June. Earlier, May and June also recorded around 1% growth in jaggery prices.
Moreover, annual jaggery inflation reached 6.28% in July. The figure stood at 5.31% during June. Non-milk based sweets also became expensive during the same period. Their prices increased 0.63% in July. Previously, June recorded a 0.82% rise, while May saw a 0.70% increase. Their annual inflation reached 6.08% in July, marking the highest level in seven months.
Festival Demand May Decide Future Price Trend
During Navratri, Dussehra, and Diwali, demand for sugar and sweets usually rises. Therefore, markets will closely watch festive demand amid already higher prices.
However, data from the last decade shows sugar inflation did not rise every festive season. During the previous ten festive periods, only 2016, 2021, and 2022 recorded faster sugar inflation than the previous three months.
In the remaining seven years, sugar inflation declined. This year looks different because sugar, jaggery, and sweets have already become costlier before celebrations begin. Therefore, the next phase will show how far prices rise and how much pressure they create on household food budgets.
