Sugar prices at Vashi market ruled steady on Tuesday despite sharp drop in mill’s tenders on increased selling, rise in freight rates by Rs 20 in the last 15-20 days on shortage of trucks and rise in demand from bulk consumers.

Mill tender rates declined by Rs 10-30, depending on quality.

Sentiment at producer level remained weak but in the physical market, prices ruled steady due to Dasara, said sources.

Jagdish Rawal of B. Bhogilal and Co., said with the start of new crushing season and higher carryover stocks (of about 85 lakh tonnes), the producers have started selling old stocks to maintain financial liquidity.

However, festival demand is picking up. .

In 2013-14, output is expected to be higher than local demand.

Indian market is facing over-supply situation since long.

Upcountry buying is negligible in Maharashtra, he said.

Meanwhile according to Indian Sugar Mills Association (ISMA), the country has opening stock of about 8.5 million tonnes.

The production estimate for 2013-14 is also more than the demand.

Arrivals at Vashi market continued to be 62–64 truck loads (each of 100 bags) while local dispatches were 61-62 truck loads.

On Monday, 18-20 mills offered tenders and sold about 54,000–55,000 bags at Rs 2,750-2,850 (Rs 2,780-Rs 2,860) for S-grade and Rs 2,900-Rs 3,000 (Rs 2,930-3,000) for M-grade.

On the National Commodities and Derivatives Exchange, sugar November futures ruled at Rs 2,895 (Rs 2,894), December was higher at Rs 2,899 (Rs 2,904) and January-14 was Rs 2,907 (Rs 2,908) till noon.

Bombay Sugar Merchants Association's spot rates were: S-grade Rs 2,962– Rs 3,105 (Rs 2,962– Rs 3,105) and M-grade Rs 3,096 - 3,272 (Rs 3,102- 3,272).

Naka delivery rates were: S-grade Rs 2,890 -2,950 (Rs 2,910-2,950) and M-grade Rs 3,005 - 3,130 (Rs 3,005 – Rs 3,130).