NEW DELHI – Prices of medium-grade sugar in key north Indian markets were up because mills are going slow in offloading stocks, which has subsided selling pressure, traders said.

In Delhi and Muzaffarnagar, prices rose by 10 rupees and 25 rupees per kg, respectively.

Another positive for the sector could be a likely decline in output in Uttar Pradesh in 2019-20 (Oct-Sep) to 12.0 mln tn, a little lower than the 12.4-mln-tn estimate for the season, an official with the state cane commissioner's office said.

Uttar Pradesh is the largest sugar producer.

"Due to more-than-required rainfall and accumulation of water in sugarcane fields late last and early this year, cane output is likely to be affected, which will affect sugar production marginally," the official said.

Contrary to the trend in north India, sugar prices in Mumbai fell by 5 rupees per kg.

"Prices are most likely to remain like this until the government makes some changes in the current minimum selling price for sugar and until elections are over, nothing new seems likely," said Sandeep Patel, a Kolhapur-based trader.

The Centre hiked the minimum selling price of sugar by 2 rupees to 31 rupees per kg in February, which hit domestic demand.

Meanwhile, prices in Kolhapur were steady due to demand-supply parity.

On ICE Futures US, the most active May contract of raw sugar was at 12.49 cents per pound, up 0.6% from the previous close.

Brazil's centre-south region is on track to produce 572 mln tn of sugarcane in 2019-20 (Apr-Mar). Of the total quantity, mills will use 36% of the cane to make sugar and the rest for ethanol, a media report said, quoting Archer Consulting.

In a recent development, the European Union, Russia and Costa Rica are seeking to join consultations sought by Guatemala over India's sugar subsidies, as part of the World Trade Organization's dispute settlement mechanism.

Earlier, Thailand, Brazil and Australia had sought consultations with India, alleging that the subsidies provided to farmers by the Indian government were inconsistent with global trade rules.

Following are today's prices for medium-grade sugar, in rupees per 100 kg, in key wholesale markets, and the change from the previous close: