Spot prices on the Vashi wholesale sugar market increased by Rs 20-30 a quintal on Wednesday on higher retail demand as the market was closed the previous day.

Naka and mill tender rates ruled steady at higher levels as producers were expecting firm trend to continue in the coming days.

Only one or two mills offered tenders the previous day evening due to bank holiday and sold less quantities.

Domestic futures market was up by Rs 12-14 till noon. Source in the Bombay Sugar Merchants Association said that talk of a hike in the excise duty on sugar has resulted in stockists covering to avoid paying a higher price later.

Producers, on the other hand, are holding on to stocks hoping for a rise in prices.

“Local dispatches were higher on Wednesday.

Mills were not very eager to sell expecting higher price.

Some profit booking may be seen in futures market but overall sentiment will remain firm,” an observer said.

Analysts said that global prices are likely to come under further pressure with new season sugar supplies starting in Brazil from April.

On Tuesday evening merely 1-2 mills offered tenders and sold 20,000- 25,000 bags (each of 100 kg) of M-grade to the local buyers in the range of Rs 3,225-3,250.

Wednesday evening traders were expecting mill tender rates at Rs 3,100- 3,130 (Rs 3,070-3,100) for S-grade and Rs 3,200-3,270 (Rs 3,150-3,260) for M-grade.

On the National Commodities and Derivatives Exchange, sugar prices for March were up by Rs 14 to Rs 3,158 (Rs 3,144); April was up by Rs 12 to Rs 3,215 (Rs 3,203) and May was higher at Rs 3,265 (Rs 3,261) till noon.

The Bombay Sugar Merchants Association’s spot rates: S-grade Rs 3,222- 3,300 (Rs 3,196-3,272) and M-grade Rs 3,292-3,442 (Rs 3,262-3,431). Naka delivery rates were: S-grade Rs 3,170-3,200 (Rs 3,170-3,200) and M-grade Rs 3,240-3,360 (Rs 3,240-3,360).