Prices on the Vashi wholesale market were mixed on Thursday but the under-current remained positive.

In spot, S-grade sugar ruled steady. M-grade dropped by Rs 20 a quintal due to old stocks offloaded at lower price.

Mills continue to sell at Rs 10-20 higher on buying support that lifted naka rates by Rs 10-30. Domestic futures prices were range bound with thin volatility.

Business in physical markets remained active ahead of annual budget next week in which most of the traders expect hike in excise duty on sugar, said sources.

A Vashi-based wholesaler said that there is a strong possibility of hike in excise duty on sugar in budget next week. Local stockists continued their covering before that. Producers also hold the price expecting higher demand in the coming days. Mills are not very eager to sell at lower rates except old stocks. Retailers also seems eager to cover small inventories considering lower market rates compare to its production cost.

With rise in temperature demand for sugar will improve, he said. On Wednesday evening, merely 18-20 mills offered tenders and sold 72,000-75,000 bags (each of 100 kg) to local buyers at Rs 3,100-3,160 (Rs 3,080-3,130) for S-grade and Rs 3,200-3,270 (Rs 3,180-3,260) for M-grade.

For exports, India needs a sharp rise in global prices, which is unlikely.

Global prices are likely to come under further pressure with new season sugar supplies starting in Brazil from April.

On the National Commodities and Derivatives Exchange, sugar prices for March were Rs 3,148 (Rs 3,149); April Rs 3,207 (Rs 3,205) and May Rs 3,262 (Rs 3,258) till noon.

The Bombay Sugar Merchants Association’s spot rates: S-grade Rs 3,222-3,300 (Rs 3,222-3,300) and M-grade Rs 3,272-3,442 (Rs 3,292-3,442).

Naka delivery rates were: S-grade Rs 3,200-3,230 (Rs 3,170-3,200) and M-grade Rs 3,240-3,370 (Rs 3,240-3,360).