Sugar prices in the physical market ruled firm on Tuesday. On the Vashi wholesale market, spot prices inched up Rs 10-20 a quintal tracking firm reports at the upper level. Naka rates increased by Rs 20-30, while mill tender rates improved by Rs 10-20.

The expectation of hike in excise duty and lower than expected output till March pushed up the sentiment in physical market, said traders.

Sources said that the sentiment improved slightly due to industry data released on Tuesday and increase in local demand at the start of the month.

Increase in temperature will also push up consumer demand for the commodity. The Vashi market currently carries more than 120 truckloads of inventory. With improvement in demand, stock pressure will be reduced. From next month market may see an upward trend, sources said.

On the NCDEX, sugar May futures was down by Rs 6 to Rs 2,992 , June contracts lower at Rs 3,053 (Rs 3,059) and July declined by Rs 14 to Rs 3,098 till noon.

In Vashi market, arrivals were 64-65 truckloads (each of 100 bags) and local dispatches were 62-63 loads. On Monday evening, about 14-15 mills offered tenders and sold 38,000-40,000 bags at Rs 2,930-2,980 (Rs 2,920-2,960) for S-grade and Rs 2,980-3,140 (Rs 2,970-3,130) for M-grade.

Bombay Sugar Merchants Association's spot rates: S-grade Rs 3,086-3,171 (Rs 3,082-3,161) and M-grade Rs 3,172-3,371 (Rs 3,150- 3,361). Nakadelivery rates: S-grade Rs 3,020 -3,070 (Rs 3,020-3,050) and M-grade Rs 3,100-3,250 (Rs 3,100-3,220).