New Delhi, Sept. 9 -- Bengaluru,

Mumbai :

Rising sugar prices are squeezing India's packaged-food makers ahead of the festive season, prompting companies to weigh price increases and smaller pack sizes as they try to absorb higher input costs without hurting demand.

Sugar prices are about 20% higher than a year ago and 20% higher sequentially, making it one of the biggest raw-material cost pressures for companies that use it across candies, confectionery, chocolates, biscuits, baked goods, sweets and beverages.

Data from the consumer affairs ministry showed the all-India average retail price of sugar at Rs.62 per kg in September, up from Rs.47 per kg in June.

Sugar availability has also tightened amid weather-related damage to sugarc...