Mumbai, July 5:

Sugar prices gained on Friday by Rs 10-20 a quintal following the Government’s decision to hike the import duty.

The Centre has decided to raise the Customs duty on sugar to 15 per cent.

Transportation charges from Kolhapur-Karad line increased by Rs 10-12 a bag, due to tight availability of trucks. This led to a drop in arrivals at the Vashi market.

The volume at mill level increased on renewed demand from nearby States along with higher local demand ahead of Ramzan.

Jagdish Rawal, a wholesaler, said, “The sentiment improved after almost two months of calm and routine demand, supply and trading activities. Prices in the physical market rose due to the Government’s decision to hike import duty on sugar and expectation of higher festival demand. New crushing season is three months away.

After a long gap, Maharashtra’s mills met with good buying response from neighbouring States, which procured nearly 55,000-60,000 bags.

Moreover, local demand increased. Producers sold 1.25-1.50 lakh bags on Thursday.”

Arrivals at the Vashi market declined to 59-60 truckloads (of 100 bags each) while local despatches were 60-62 truckloads.

On Thursday, about 16-18 mills offered tenders and sold about 1.25-1.50 lakh bags including 85,000-90,000 bags to local traders at higher price of Rs 2,940-3,000 (Rs 2,925-2,990) for S-grade and Rs 3,040-3,120 (Rs 3,020-3,110) for M-grade.

The Bombay Sugar Merchants Association's spot rates were: S-grade Rs 3,072-3,145 (Rs 3,062-3,135) and M-grade Rs 3,202-3,311 (Rs 3,192-3,291).

Naka delivery rates were: S-grade Rs 3,020-3,070 (Rs 3,010-3,070) and M-grade Rs 3,110-3,210 (Rs 3,110-3,200).