Mumbai, July 29,
Sugar prices in Vashi spot market decline by Rs12 for S-grade lower side and by Rs11 for M-grade higher side on Monday due to slack demand and weak moral upper end. Mills continued selling but bulk and stockiest buying kept routine. Mill tender rates were down by Rs10-Rs20.
More than sufficient inventory stocks in Vashi market and month end ease local demand also weigh on futures markets which rule in thin volatility. Sugar prices are under selling pressure since start of the month. Sentiment in physical market was weak said sources.
Vashi base wholesaler said “As sugar output in India continued to be higher than local demand on third - fourth consecutive year and sufficient stocks held with producers and stockiest since start of the 2012 –2013 season year trend remain bearish under continuous selling pressure”.
In the 2013-14 year beginning October is likely to drop 5.2 percent from a year earlier to 237 lakh tonnes, compared with a local demand of around 230 lakh tonnes. Sugar production this year expected at 250 lakh tonnes he said”.
Analyst said, Vashi market currently carries 125 – 130 truckloads of stocks hence stockiest preferred to buy as needed. Prices in other states also rule par with Maharashtra’s parity diverting Eastern side buyers to Southern states especially Karnataka. Normally they feed their requirement from Maharashtra due to price advantage but which is not favourable this year.
Ample monsoon rains in cane growing states which will help cane crop recovery also weigh on sentiment. Maharashtra and Uttar Pradesh, the top two sugar producers in India, received more rainfall than normal since the start of the monsoon season analyst said.
The arrivals in the market were 63 – 64 truck loads (Each of 100 bags) and local dispatches were 61 – 62 truck loads. On Saturday evening about 10-12 mills offered tenders and sold about 38,000 – 40,000 bags at Rs 2,900-2,970 (Rs 2,910-Rs 2,980) for S-grade and Rs 2,990-Rs 3,150 (Rs 3,000- 3,170) for M-grade.
On National Commodities and Derivatives Exchange sugar August -13 futures was flat at Rs 3,027 (Rs 3,027), September lower by Rs2 to Rs 3,039 (Rs 3,041) and October drop by Rs3 to Rs 3,062 (Rs 3,065).
Bombay Sugar Merchants Association's spot rates were: S-grade Rs 3,040– Rs 3,132 (Rs 3,052– Rs 3,132) and M-grade Rs 3,162 - 3,311 (Rs 3,162-3,321). Naka delivery rates were: S-grade Rs 3,000 -3,050 (Rs 3,000-3,050) and M-grade Rs 3,080-3,190 (Rs 3,080-3,190).