Sugar range-bound on routine demand

Sugar prices on the Vashi wholesale market were mixed on Friday.

Prices weakened by Rs 5-10 a quintal at the physical level due to routine mid-month demand. Naka rates increased by Rs 10-20 for M-grade on higher demand for fine variety, while for S-grade fair quality declined by Rs 20.

Mill tender rates ruled steady on the Centre's decision to allow more exports. A leading broker said that the spot market was range-bound on routine local demand. Supply of fine quality sugar was tight, leading to a small rise in price. Only a few mills offered tender on Thursday evening after they sold good amount of sugar on Wednesday. Hence, naka rates ruled firm.

The market may improve due to end of the crushing season, higher demand for festivals beginning July and possible decline in cane cultivation area due to shortage of water in Maharashtra. The sharp rise in dollar has wiped out most of gains from the decline in world sugar prices, a broker said.

The sugarcane crushingseason in Maharashtra will be over by this month. Maharashtra production is estimated at 89.50 lakh tonnes. Next season, production is expected to decline by 10- 15 per cent to 80-82 lakh tonnes due to the drought like situation in the State. The area under cane cultivation has dropped to 9 lakh hectares (10.22 lakh hectares).

In the Vashi market, arrivals were 50-52 truckloads and local dispatches were 48-50 truck loads. On Thursday evening, 11-12 mills offered tenders and sold about 42,000-45,000 bags to local traders in the range of Rs 2,840-2,930 (Rs 2,840-2,930) for S-grade and Rs 2,930-3,000 (Rs 2,920-2,990) for M-grade.

The Bombay Sugar Merchants Association's spot rates (Rs/quintal) : S-grade Rs 2,956-3,002(Rs 2,956-3,011) and M-grade Rs 3,026-3,171 (Rs 3,031-3,181). Naka delivery rates: S-grade Rs 2,910 -2,960 (Rs 2,930-2,960) and M-grade Rs 2,990-3,080 (Rs 2,970-3,070).

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