Commodities

Sugar hits a low on poor demand

| | Updated on: Jan 12, 2011
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Sugar prices on the wholesale Vashi market are touching new lows everyday. On Wednesday, spot and naka rates declined Rs 10-15 a quintal but at the mill level, on Tuesday, tender rates crashed Rs 35-40 a quintal. A further Rs 15-20 drop was expected on Wednesday.

Mills lowered rates in tandem with falling demand. A wholesaler told business line : “ Prices at Vashi market have already come down by over 100 till now. Further decline is also expected as the Centre is not in favour of sugar exports and higher free sale quota may lead to desperate selling by mills. The Government is very conscious of high food inflation. Arrivals in the Vashi market were higher than local dispatches, adding the market inventory. Stockists, having enough inventory, do not want to pile more.”

At the national level, main consuming centres are also facing the problem of local demand. Tender offer from most mills were open as they could not get the expected response. On Tuesday evening, approximately 14-15 mills came forward with tenders but a few have sold about 38,000-40,000 bags of sugar in the range of Rs 2,730-2,770 a quintal for S-grade and Rs 2,790-2,830 for M-grade. Others kept tenders open. Mills quoted tender rates Rs 15-20 lower than Tuesday.”

On Wednesday, arrivals in the market were about 42-45 truckloads (each 100 bags) and local dispatches were about 38-40 truck loads.

According to Bombay Sugar Merchants Association, spot sugar rates were S-grade Rs 2,886-2,931 (Rs 2,896-Rs 2,942) and M-grade Rs 2,906-2,991 (Rs 2,921-3,001). Naka delivery rates were S-grade Rs 2,850-2,880 (Rs 2,850-2,880) and M-grade was Rs 2,890-2,930 (Rs 2,900-2,940).

Published on January 12, 2011

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