Spot sugar declined by Rs 8-10 for a quintal on Wednesday on eased local demand.

Naka rates for S-grade lost Rs 10 a quintal and Rs 20 for M-grade on higher sales in the resale market. Among mill tender rates, S-grade firmed up by Rs 10 a quintal while M-grade eased by Rs 10. A leading wholesaler said need-based demand kept volume normal and prices range-bound. Absence of demand from neighbouring States in Maharashtra is forcing local producers to concentrate on local markets where demand is less than supplies due to higher production this year. Freight rates were steady after a recent small hike.

Due to vacations, consumption demand is lower in the west, but it is expected to improve from next month. Summer will also be at its peak then, leading to higher demand across the country. Production in the first six months of the production year that is from October to September increased by 13 per cent to 246.3 lakh tonnes compared with 217.1 lakh tonnes in the year-ago period. Besides, stocks in distribution markets also dampened buying, traders said.

The Union Government has declared 46 lakh tonnes free-sale quota for April-June. Lower demand in the current month will keep producers under pressure to sell allotted quota in due time.

In Vashi, while about 50-51 truckloads arrived, about 47-48 truckloads were locally despatched. On Tuesday evening, about 17-18 mills offered tenders and sold 78,000-80,000 bags to local stockists for Rs 2,770-2,820 (Rs 2,750-2,820) for S-grade and for Rs 2,870-2,930 (Rs 2,870-2,940) for M-grade.

Bombay Sugar Merchants Association's spot rates: S-grade Rs 2,882-2,951 (Rs 2,876-2,952) and M-grade Rs 3,021-3,111 (Rs 3,026-3,111).

Naka delivery rates: S-grade Rs 2,840 -2,880 (Rs 2,840-2,890) and M-grade Rs 2,930-3,030 (Rs 2,950-3,050).