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Sugar futures on the National Commodity and Derivatives Exchange Ltd (NCDEX) gained five per cent to Rs 3,347 a quintal last week, despite the Government’s intention to control prices by imposing certain curbs.
Given the dry weather in sugarcane growing regions of Maharashtra and Karnataka, the general trend will be up.
However, prices may fall occasionally on profit-booking and if the Government reinforces stock limit. Exports may also be restricted to cool down prices in the domestic market.
According to IMD reports, monsoon progress is slow in major sugarcane growing regions and is 22 per cent below normal. Expectations of good demand in the coming months ahead of festive season may also support prices.
The Government had last week approved 17 per cent hike in sugarcane prices to Rs 170 a quintal for 2012-13 sugar season.
The total acreage under sugarcane as on July 6 was up 2.5 per cent at 52.78 lakh hectares, according to latest updates from the department of agriculture.
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