NEW DELHI – Prices of medium-grade sugar fell by 10 rupees per 100 kg in the wholesale markets of Muzaffarnagar today because rainfall for the past three days dented demand, traders said

A fresh western disturbance is likely to affect western Himalayan region and adjoining parts of northwest India from Saturday, the India Meteorological Department said today.

"The situation is such right now that I have 10 tn sugar but demand is not there even for 3 tn… Prices are unlikely to fall but if more rains happen, then we can't say," said Vijay Kapoor of Muzaffarnagar-based Anshika Sugars.

IMD has forecast thunderstorm and hailstorm over isolated parts of Punjab, Haryana, western Uttar Pardesh, and Chandigarh on Sunday and Monday.

On the crushing front, mills across the country have so far crushed 92.6 mln tn cane to produce 9.4 mln tn sugar at a recovery rate of 10.13%, according to data from National Federation of Cooperative Sugar Factories.

In another major development, the Uttar Pradesh government has provided 2 bln rupees to co-operative mills to help them pay off cane dues to farmers for 2018-19 (Oct-Sep).

Co-operative sugar mills owe over 6 bln rupees in cane dues to farmers from the previous two seasons. Of the 24 co-operative mills in the state, only four mills have made timely payments to farmers.

"The government support will help these mills pay part of workers' salaries and also cane arrears… They would only meet the losses that they have incurred with the assistance provided," an industry official said.

Sugar prices were flat in Mumbai, Kolhapur, and Delhi today because of lack of fresh cues.

Prices were down in Delhi by 5-7 rupees a 100 kg in the morning but recovered to Wednesday's level later in the day due to a pick-up in demand after the sky cleared, said Naresh Gupta, a local dealer.

On ICE Futures US, the most-active contract rose 0.4% to 13.52 cents per pound at 1802 IST.

"It's safe to say that the sugar market has started the year in a more interesting way than it ended in the previous one. Given the recent price action it would not be difficult to rule out another test at recent highs, with momentum and volumes picking up, we are optimistic about the start to this New Year," Sucden Financial said in a report.

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