# Sugar mills face 140-160 bps margin hit as ethanol curbs, higher cane costs bite

> Crisil Ratings expects Indian sugar mills’ operating margins to fall by 140–160 basis points to about 6% this fiscal. Restrictions on ethanol made from sugar-based feedstocks, higher sugarcane procurement costs, and greater borrowing needs are squeezing profitability, while firm sugar prices provide some revenue support.

- Date: 2026-11-09 · published 2026-11-10T03:17:16.085Z
- Category: policy · region India · magnitude medium
- Page: https://feedsoft.ai/events/90804-sugar-mills-face-140-160-bps-margin-hit-as-ethanol-curbs-higher-cane-costs-bite
- Commodities: [Corn](https://feedsoft.ai/c/CORN.md), [Rough Rice](https://feedsoft.ai/c/RICE.md)

## Why it matters

Limiting sugar-based ethanol reduces mills’ higher-margin fuel sales and keeps more sugar available for domestic use, while increased cane costs raise production expenses. The restriction can redirect ethanol feedstock demand toward grains such as corn and rice.

## Read by commodity

- CORN: bullish ▲
- RICE: bullish ▲

## Similar past events

| Commodity | Date | Event | 5-day % | 20-day % |
| --- | --- | --- | --- | --- |
| CORN | 2026-10-28 | [Indian distillers seek 9% corn ethanol price hike as feedstock costs surge \| World Ports Organization](https://feedsoft.ai/events/2890-indian-distillers-seek-9-corn-ethanol-price-hike-as-feedstock-costs-surge-world.md) | -0.5% | — |
| CORN | 2025-10-23 | [Corn ethanol set to overtake sugarcane’s long-standing dominance](https://feedsoft.ai/events/22397-corn-ethanol-set-to-overtake-sugarcane-s-long-standing-dominance.md) | +1.8% | +3.4% |
| CORN | 2024-06-05 | [Brazil could triple corn ethanol output, margins to stay healthy: Inpasa](https://feedsoft.ai/events/29741-brazil-could-triple-corn-ethanol-output-margins-to-stay-healthy-inpasa.md) | +5.7% | -3.0% |
| CORN | 2025-06-20 | [US biofuel policy increases ethanol margins; DDGS market sees limited impact](https://feedsoft.ai/events/24201-us-biofuel-policy-increases-ethanol-margins-ddgs-market-sees-limited-impact.md) | -3.3% | -3.7% |
| CORN | 2020-12-31 | [CBOT corn higher - Markets - Business Recorder](https://feedsoft.ai/events/49676-cbot-corn-higher-markets-business-recorder.md) | +6.2% | +17.5% |
| RICE | 2022-05-26 | [Sugar exports: India's curbs on wheat and sugar exports spark concern that rice may be next - The Economic Times](https://feedsoft.ai/events/41367-sugar-exports-india-s-curbs-on-wheat-and-sugar-exports-spark-concern-that-rice.md) | -0.6% | -6.0% |
| RICE | 2023-08-03 | [Rice prices hit 11-year high as Indian export ban fuels supply fears - Nikkei Asia](https://feedsoft.ai/events/12034-rice-prices-hit-11-year-high-as-indian-export-ban-fuels-supply-fears-nikkei-asia.md) | +0.8% | +4.8% |
| RICE | 2025-07-28 | [Rate Difference in Grain-Based and Sugarcane-Based Ethanol Production Affecting Sector: Official – Outlook Business](https://feedsoft.ai/events/23740-rate-difference-in-grain-based-and-sugarcane-based-ethanol-production-affecting.md) | -2.9% | -8.6% |

## Sources

- cnbctv18.com: https://www.cnbctv18.com/business/sugar-mills-face-140-160-bps-margin-hit-ethanol-curbs-higher-cane-costs-bite-crisil-20030363.htm

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Data from Feedsoft AI (https://feedsoft.ai/). For information only; not investment advice.