NEW DELHI – Ex-mill prices of medium-grade sugar in north India fell today due to lack of bulk demand as malls, restaurants, confectioneries and ice-cream parlours are shut due to the 21-day nationwide lockdown to contain the spread of COVID-19, traders said.
Prices were down 10 rupees per 100 kg in Muzaffarnagar, and 15 rupees in Delhi.
"Prices are likely to remain subdued for long as consumption has been hit. Demand, which would have been there due to summer season, etc, has been killed," said Naresh Gupta, a Delhi-based trader.
Movement of sugar had initially been disrupted as spread of the novel coronavirus and the nationwide lockdown led to lower availability of trucks. In the initial days, there were also concerns over smooth availability of inputs such as lime, sulphur, bags and phosphoric acid.
However, sugar dispatches have picked up over the last four-five days, and normal supply of important inputs is also in place now, Indian Sugar Mills Association said in a release today.
On the crushing front, mills in India produced 23.27 mln tn sugar during Oct-Mar, down 21.6% from the year-ago period. As on Mar 31, 271 sugar mills ended crushing operations. Only 186 mills are crushing and most of them are in north India, data from ISMA showed.
Meanwhile, prices were unchanged in Mumbai and Kolhapur today due to lack of fresh cues.
The most active May contract of raw sugar on Intercontinental Exchange Futures US was down 1.8% at 10.23 cents per pound. Prices had hit an 18- month low of 10.25 cents today due to expectations of higher production in Brazil, the world's largest producer, analysts said.
The country is likely to increase its sugar production to 34 mln tn in 2020-21 (Apr-Mar) from 26.5 mln tn this season. It may export 29 mln tn of the sweetener this season, compared with 18 mln tn last year, a market source said. 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:
MARKET PRICE CHANGE
Delhi 3,310 (-)15
Mumbai 3,500 0
Muzaffarnagar 3,300 (-)10
Kolhapur 3,300 0