Sugar prices extended further losses by Rs 20 for S-grade and Rs 40 for M-grade on Thursday tracking weak futures market and lack of demand in spot market. Naka rates ruled weak on back of improved selling pressure at mill level. Mill tender rates were expected lower by Rs 30-40 in line with weak futures prices. Domestic futures prices were lower by Rs 40 till noon.Arrivals were higher than local dispatches, said traders.
Mukesh Kuwadia, Secretary of Bombay Sugar Merchants Association (BSMA), told Business Line, “Selling pressure of mills will continue as they have to complete the sales of current month’s free sale quota in time. The Government has released additional quota of 2.66 lakh tonnes on July 27 and another 4 lakh tonnes on has been released on August 7 to be sold off by August 31. These extra quotas have suddenly improved supply position in open markets which has arrested the bullish trend witnessed during first week when prices crossed the Rs 3,900 level in Vashi. Since then prices have decline by more than Rs 250 a quintal. After Eid, there is no major festival for nearly a month, which could result in decline in consumer demand. It is also putting pressure on prices.”
Kuwadia further said expecting a bullish trend, local stockists have covered sugar at higher price in the first week of the month and now they keep away from taking fresh position as retail demand also has eased during middle month. In Vashi market, arrivals were 55 - 57 truck loads (Each of 100 bags of quintal each) and local dispatches were about 48-50 truck loads. On Tuesday evening about 17 – 18 mills offered tenders and sold about 50,000 – 55,000 bags (Each of 100 kg) to local stockists in the range of Rs. 3,380-3,450 (Rs 3,410-3,480) for S-grade and Rs 3,480-3,580 (Rs 3,510-3,570) for M-grade.
Bombay Sugar Merchants Association's spot rates: S-grade Rs 3,522-3,612 (Rs 3,536-3,632) and M-grade Rs 3,612- 3,752 (Rs 3,601- 3,791). Nakadelivery rates: S-grade Rs 3,480 -3,530 (Rs 3,480-3,520) and M-grade Rs 3,550-3,630 (Rs 3,550-3,640).