Sugar Supply Crunch? Swiggy Instamart, Blinkit Restrict Purchases Ahead Of Festive Season, Says Report

(MENAFN- Live Mint) Retail chains, including Swiggy Instamart, along with quick-commerce platforms such as BigBasket, and Blinkit have introduced caps on sugar purchases in several markets. The restrictions vary by location and brand, with some retailers allowing customers to purchase only 3 kg to 5 kg of sugar at a time, Economic Times (ET) reported.

The move comes as packaged food manufacturers contend with rising input costs, including higher prices of sugar and edible oil. The increase is putting pressure on manufacturers' margins just as consumer demand is expected to pick up during the festive period.

Several packaged food companies are preparing to raise product prices by at least 5% to 6%. Some manufacturers expect prices to rise further if sugar remains expensive.

Quick answers to key questions

.5 QUESTIONS1What restrictions have Swiggy Instamart and Blinkit placed on sugar purchases?⌵

Swiggy Instamart and Blinkit have introduced caps on sugar purchases, allowing customers to buy only 3 kg to 5 kg at a time, depending on location and brand.

2Why have sugar prices increased ahead of the festive season?⌵

Sugar prices have risen due to lower domestic production, expected higher demand during the festive season, weather-related crop damage, tighter global supplies, and speculation and hoarding.

3How are retailers managing sugar supply amidst rising prices?⌵

Retailers are rationing sugar stocks by limiting the number of sugar packs customers can buy per transaction, ensuring more consumers can access the limited supply.

4Should consumers expect further price increases on packaged food products?⌵

Yes, packaged food companies are preparing to raise prices by at least 5% to 6% due to rising sugar and input costs.

5What impact is government intervention having on sugar imports?⌵

The government has allowed the import of one million tonnes of sugar to ease supply concerns and help contain rising prices.

“We have no choice but to increase prices by about 5%,” The chief of a leading domestic snack food maker was quoted as saying by ET.

Lower output, exports push up sugar prices

The recent rise in sugar prices has been linked to production falling below earlier estimates, exports of 800,000 tonnes and alleged stockpiling by some trade intermediaries.

The situation has reportedly been compounded by inaccurate production projections from industry bodies, including the Indian Sugar and Bio-energy Manufacturers' Association (ISMA).

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In an attempt to ease supply concerns and contain prices, the government allowed the import of one million tonnes of sugar last week.

Big staples companies told ET that several retail and e-commerce platforms have started rationing sugar stocks, generally allowing customers to buy two to three 1-kg packs or a single 5-kg pack.

“Many retail chains have put a cap on the number of sugar pouches per customer to enable maximum consumers to buy the commodity from their chain,” Angshu Mallick, executive deputy chairman, AWL Agribusiness told ET.

Blinkit, BigBasket and Instamart restrict purchases

The purchase limits differ across cities and platforms.

In Delhi-NCR, Blinkit has restricted customers to one 5-kg pack per transaction for products including Mawana Premium Crystal Sugar and Dhampure Crystal White Sugar. The listings carry a disclaimer stating:“Sorry, we have limited quantities available for this item.”

In Pune, customers on Blinkit can add a maximum of three 1-kg packs of certain sugar products to their carts. BigBasket has similarly capped purchases of specific brands at five 1-kg packs.

Swiggy Instamart has imposed lower limits for some products in Delhi-NCR. Supreme Harvest Crystal Sugar is capped at two 1-kg packs, while customers can also purchase a maximum of two 1-kg packs of Madhur sugar.

At a D-Mart outlet in Pune, a notice displayed for customers said:“You are allowed to purchase 5 kg sugar on every invoice. Regret the inconvenience.”

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The government has attributed the increase to five major factors.

Lower domestic production: Sugar production in the current season is expected to be around 30.6 million tonnes, below the initial estimate of about 34.3 million tonnes made by sugarcane-growing states.

The government attributed the shortfall to Red Rot and Top Borer diseases affecting sugarcane, as well as waterlogging caused by excess rainfall.

Festive-season demand: Demand for sugar is expected to strengthen ahead of the festive season, putting additional pressure on prices.

Weather-related crop damage: Excess rainfall and waterlogging have affected sugarcane output, contributing to the lower production estimate.

Tighter global supplies: International sugar prices have also risen amid tighter global supplies. The government estimates a global sugar deficit of about 3.3 million tonnes in 2026-27. International sugar prices increased more than 16% to $552 a tonne on August 20 from $474 a tonne on June 30.

Speculation and hoarding: The government also cited speculation and hoarding by some sections of the industry as factors contributing to the price increase.

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