Sugar prices gained Rs 10-15 a quintal on Friday on increased demand for quality sugar in the physical market. In the spot market, medium of M-grade rose above Rs 3,100. Naka rates improved by Rs 15-20, tracking higher mill tender rates.

Mills increased prices by Rs 20-25 a quintal, which also led to higher spot prices. Despatches from mills have dropped as banks are closed for two days even as demand is high due to the beginning of a month, said the spokesman of B. Bhogilal and Co. Local despatches were higher than arrivals on Friday.

Few mills floated tenders on Thursday evening due to a holiday, but sales were still high on demand for fine-quality produce of the current year.

Since the Vashi wholesale market was closed on Thursday for Mahavir Jayanti, demand was high on Friday.

Transport sources said freight rates remain unchanged, though there is a shortage of trucks in some producing areas.

Transporters are expecting freight rates to rise by Rs 4-5 a bag for delivery at Sangli, Kolhapur and Karad. Arrivals at Vashi were about 47-48 truckloads and local despatches were higher at 51-52 truckloads.

On Thursday late evening, only 8-10 mills offered tenders and sold 58,000-60,000 bags at Rs 2,740-2,820 (Rs 2,720-2,810) for S-grade and Rs 2,840-2,920 (Rs 2,820-2,910) for M-grade.