Indian sugar mills association

Maharashtra sugar up on higher

Date:	17 Nov 2011

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News ID:	693

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Mumbai, Nov. 16: Sugar prices on the Vashi wholesale market shot up by Rs 60-80 a quintal on Wednesday after witnessing a downward correction of Rs 50-70 on Tuesday.

New buying by stockists and neighbouring States at higher rates pushed up the prices in the physical market. Spot rates increased by Rs 50-60, while naka rates shot up by Rs 60-80 a quintal. Mill tender rates improved by Rs 40-70 based on quality and higher demand.

Sugar prices are high in Uttar Pradesh due to the sharp hike in State-advised cane price by the Mayawati Government this week, a leading broker said. Compared with Uttar Pradesh, a lower hike in cane price by Maharashtra kept the price low in Maharashtra for northern buyers. This led to sharp improvement in sentiment in physical and futures markets. Domestic sugar futures also shot up by Rs 140-150 in the last two days, indicating bullish sentiment.

In the Vashi physical market, the volume was as usual in the middle of the month, market sources said. On Tuesday evening, mills in the State sold about one lakh bags at higher rates. It includes one rake (27,000 bags) of S-grade sold to neighbouring-State buyers. Expectation of active buying of northern States in Maharashtra due to higher prices in Uttar Pradesh, kept sentiment firm at the upper level here. Further strong belief of permission for more sugar exports soon is another factor to push the prices up . In Maharashtra sugar price is Rs 200 lower than northern States. Sugar prices in Mumbai spot market rose nearly Rs 165-170 in first fortnight, tracking sharp jump in mill tender rates. In the current month, out of the 16 days, the market witnessed only two-three days profit taking correction, while in other days, sugar prices kept rising continuously.

Currently, ex-mill price in Uttar Pradesh is around Rs 2,900-2,950.

On Tuesday, about 18-20 mills offered tenders and sold about 65,000-70,000 bags to local traders and one rake (27,000 bags) to upcountry buyers in the range of Rs 2,840-2,940 (Rs 2,770-2,850) for S-grade and Rs 2,940-3,040 (Rs 2,920-3,000) for M-grade. Arrivals in the Vashi market were at 50-52 truckloads and local dispatches were nearly 47-48 truckloads. In the international market, December-11 futures was up by $10.50-669.70 ($659.20) and March-12 futures at $640.90 ($639.50) on Tuesday.

Bombay Sugar Merchants Association`s spot rates (Rs/quintal): S-grade - Rs 2,986-3,061 (Rs 2,931-3,001); and M-grade - Rs 3,061-3,191 (Rs 2,996-3,131).

Naka delivery: S-grade - Rs 2,980-3,000 (Rs 2,900-2,970); and M-grade - Rs 3,050-3,150 (Rs 2,970-3,100).

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