Spot sugar prices at the Vashi market decline by Rs 9-10 on Tuesday after ruling steady since last Wednesday. Mills have started selling at reduced rates on usual need-based local demand and in the absence of bulk buyers to avoid more inventory building. Mill tender rates were down by Rs 12-15 a quintal, as more mills came forward with offers to sell. Moral was weak on limited business, but most traders are of the opinion that sugar prices at the mill level will not decline more from the present level, considering the cost of production and end of season.

Higher input cost

Mr Harakhchand Vora, Vice-President of the Bombay Sugar Merchants Association told Business Line, “Considering payment made to farmers for cane by mills and higher input cost for production, sugar prices are not going to decline further from present level. However in absence of demand, needy mills may sale at price Rs 10-15 plus/minus for managing financial liquidity. But, the overall sentiment will not be weak as the crushing season will also be over by next month. Due to vacation period this month, the Vashi market has witnessed limited local demand. From next month, some improvement is expected.

On Monday evening about 20-22 mills offered tenders and sold a total of about one lakh bags (100 kg each) sugar to local buyers in the range of Rs 2,610-2,650 for the S grade and Rs 2,660-2,740 for the M grade. Sufficient inventory stocks in the Vashi market kept wholesalers away from big inventory buying. Arrival in the market was about 40-42 truck loads (each 100 bags) and local dispatch was nearly 36-38 truck loads.

Bombay Sugar Merchants Association sugar rates:

Spot rates: S grade Rs 2,742-2,781 (Rs 2,752-2,791) and M grade Rs 2,792-2,891 (Rs 2,801-2,891). Naka delivery rates: S grade Rs 2,700-2,730 (Rs 2,700-2,730) and M grade was Rs 2,760-2,840 (Rs 2,740-2,860).

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