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Bearish sentiment prevailed in Vashi sugar market on Thursday. Spot sugar prices came down further by Rs 10-15 a quintal in line with decline in mill tender rates.
Naka rates were up Rs 10 on lack of selling. Less than expected bulk consumer demand and selling pressure for high free sale quota for the current month kept volume steady and morale weak, said a wholesaler.
Mr Mukesh Kuwadia, Secretary of Bombay Sugar Merchants Association, said during festival season sweets and confectionery makers are the main bulk consumers of sugar. About 60 per cent sugar from the monthly quota is used by bulk consumers.
This year due to very high rates/cost of sweets and confectionery products kept the common man away from buying those products. Higher food inflation has led to lower production and consumer demand for the products.
Domestic sugar futures market was further weakened by Rs 10-15 till noon. Retail demand was also lower than expected due to fasting days of festivals.
Prices ruled weak in other producing – consuming centres like Uttar Pradesh, Delhi, Rajasthan, and Gujarat – on subdued demand. Rain in the city in the early part of the day also affected local demand.
However, due to the beginning of the month the day's arrivals and dispatches were steady, he added.
According to sources, some mills expecting higher price, keep holding tender rates higher for good quality sugar.
Currently fair quality sugar is largely traded in market.
On Wednesday about 24-25 mills offered tenders and sold 35,000-40,000 bags (each of 100 kg) in the range of Rs 2,575-2,615 (Rs 2,585-2,630) for S grade and Rs 2,630-2,700 (Rs 2,610-2,690) for M grade. Arrival in the market was 53-54 truck loads (each of 100 bags) and local dispatches were also at similar levels.
Bombay Sugar Merchants Association sugar rates:
Spot rates: S grade Rs 2,721-2,811 (Rs 2,721-2,762) and M grade Rs 2,766-2,911 (Rs 2,7612,931).
Naka delivery rates: S grade Rs 2,670-2,710 (Rs 2,670-2,700) and M grade was Rs 2,700-2,860 (Rs 2,720-2,860).
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