Commodities

Sugar drops further by Rs 30-40 a quintal

Our Correspondent Mumbai | Updated on July 28, 2011 Published on July 28, 2011

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Sugar prices at Vashi market declined by Rs 30-40 a quintal on Thursday, tracking the previous day's sharp fall of Rs 85-90 in future markets. In ready and naka delivery business, prices fell by Rs 20-40 a quintal due to limited demand. At mill level, prices declined by Rs 30-40 a quintal despite fewer tenders from mills. Uncertainty over quota quantity dampened fresh business sentiment, traders said.

Mr Mukesh Kuwadia, Secretary of Bombay Sugar Merchants' Association, said Thursday's sudden decline was the result of the previous day's sharp fall in futures market. Mills and re-salers have sold sugar at lower rates, affecting sentiment in the physical market. Sugar future prices on Thursday showed steady trend with marginal rise, but the mood was bearish in the spot market due to poor month-end demand. The market is expected to move along the lines of the free-sale quota announcement for August. The current sentiment was steady but volatile due to quota rumours, he said.

A leading wholesaler said few mills had offered tenders on Wednesday, and most seem to have sold their allotted quota for the current month, which is reflected in their offering up to August 5-8. All are waiting for the announcement of next month's quota and anticipating sufficient quantity to meet the demand during the festival season ahead (August onwards).

For July, the Government declared 12.6 lakh tonnes plus 3 lakh tonnes carryover, totalling 15.6 lakh tonnes in the free-sale quota (compared to 16.5 lakh tonnes in June). On Wednesday, four-five mills offered tenders and sold about 5,000-6,000 bags (100 kg each) in the range of Rs 2,660-2,700 (Rs 2,690-2,740) for S grade and Rs 2,750-2,810 (Rs 2,750-2,830) for M grade. Arrival in the Vashi market stood at 48-50 truckloads (100 bags each) and there were 47-48 truckloads of local despatches. In the international market, London white sugar October future was $803.50 ($805.40) a tonne.

Bombay Sugar Merchants' Association rates:

Spot rates: S grade Rs 2,771-2,822 (Rs 2,801-2,846); and M grade Rs 2,841-2,951 (Rs 2,856-2,991).

Naka delivery rates: S grade Rs 2,710-2,760 (Rs 2,740-2,780); and M grade Rs 2,770-2,900 (Rs 2,800-2,940).

Published on July 28, 2011
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