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Friday, Dec 03, 2004

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Sugar prices may rise on demand, lower free sale quota

Dhimant Bhatt

Mumbai , Dec. 2

SUGAR prices are expected to go up this month on strong seasonal buying and lower free sale quota announced by the Government.

Ready prices of small grade-30 in Mumbai moved up Rs 20 at Rs 1,616/1,650 per quintal past two days. Medium grade-30 prices also went up by Rs 25 at Rs 1,635/1,720 per quintal in last two days.

Similarly, mills tenders in Mumbai were ruling higher by around Rs 50 at Rs 1,500/1,520 per quintal for small grade and Rs 1,560/1,575 per quintal for medium grade.

Mills tenders in Uttar Pradesh, Gujarat and Tamil Nadu were ruling higher by Rs 50/60 per quintal in past two days on feeling that supply from mills might reduce, sources said.

"Demand from retailers and upcountry traders will continue in view of ongoing wedding season. Also, the Government has announced lower free sale quota by one-lakh tonnes at 11 lakh tonnes for the current month. As a result, prices may go up further," a local trader said.

The Centre had earlier announced 40 lakh tonnes of free sale quota for the last quarter (October-December) of 2004. Out of this, the Government released 39 lakh tonnes that include 15 lakh tonnes for October, 13 lakh tonnes for November and 11 lakh tonnes for December, trade sources said.

"Free sale quota released for current month is not relatively enough to cater ongoing wedding season demand. Current allocation to the State also reduced by 20 per cent over last month," a trader said.

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