Sugar prices on the Vashi wholesale spot market increased by Rs 10-20, tracking firm trend upper level on Monday. Naka delivery rates rose by Rs 10-25 on higher tender rates as mills were reluctant to sell, hoping for higher demand from local traders and exporters. Mill tender prices were up by Rs 20 as producers held the price, taking support from prevailing overall bullish sentiments, said sources.

A leading retail broker said the sentiment was bullish in the spot market. Crushing for the current season will be over by this month-end, leaving it for the demand to move the market. Permits for unrestricted sugar exports and better prospects of exports due to a weak rupee are also likely to help. From June all these factors are likely to come into play, leading to higher demand and rise in sugar price in the medium term.

Currently, price rise in sugar is limited on normal local demand. Neighbouring States buying is isolated. Supply in local market is ample, resulting pressure on price, sources said.

The area under sugarcane cultivation has dropped to 9 lakh hectares compared with 10.22 lakh hectares in Maharashtra last year. Next year, sugar production in the State is expected to be 80-82 lakh tonnes.

In the Vashi market, arrivals were 52-53 truckloads and local dispatches were 51-52 loads.

On Saturday, 15-16 mills sold 74,000-75,000 bags to local traders in the range of Rs 2,850-2,940 (Rs 2,830-2,920) for S-grade and Rs 2,950-3,020 (Rs 2,930-3,000) for M-grade.

The Bombay Sugar Merchants Association's spot rates were : S-grade Rs 2,952-3,006 (Rs 2,932-3,006) and M-grade Rs 3,041-3,171 (Rs 3,032-3,161). Nakadelivery rates : S-grade Rs 2,940 -2,970 (Rs 2,915-2,960) and M-grade Rs 3,000-3,080 (Rs 2,980-3,070).

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