Indian sugar mills association

Selling pressure drags Maharashtra sugar

Date:	23 Dec 2011

Source:	The Business Line

Reporter:	BL Correspondent

News ID:	791

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Mumbai, Dec. 22: Resale selling pressure dragged sugar prices in Maharashtra but sellers refusal to sell at lower prices perked up rates for the commodity in Uttar Pradesh on Thursday.

In Maharashtra, prices at the naka level dipped by Rs 25-40 for M-grade and by Rs 15 for S-grade. In central Uttar Pradesh, sugar produced last season that ended in Septmerb was quoted at Rs 2,860-70 a quintal, while the one produce this year was quoted at Rs 2,950.

“Demand is emerging in Uttar Pradesh. By tomorrow, we could see more pick up in demand,” said a trading source.

In Maharashtra, producers are not very keen to sell at lower prices and held back stocks, leading to firmness of Rs 10 in mill tender rates. Routine volumes also contributed to the steady sentiment.

There is a lower chance of high volatility till month-end as supply from mills is sufficient, said market sources.

A wholesaler said national level demand-supply scenario is very normal, ruling out sudden volatility. With the sufficient free sale quota for the month, buyers are keeping away from inventory buying and on the other side, producers are continuing to sell to avoid building up of stocks. He further said that despite the Government having allowed 10 lakh tones sugar exports last month, very few release orders have been issued so far due to weak global market. The government will consider more sugar exports after the mills exhaust the quota.

Weak international market and possible exports from Pakistan are seen to trigger stiff competition. On Thursday, there was talk of Pakistan permitting exports of 8 lakh tonnes in 2011-2012 on hopes of higher production.

At the Vashi market on Wednesday, about 20-22 mills offered tenders and sold about 60,000-65,000 bags in the range of Rs 2,800-2,860 (Rs 2,790-2850) for S-grade and Rs 2,870-2,960 (Rs 2,850-2,960) for M-grade.

Arrivals at the Vashi market were at 50-52 truckloads and local dispatches were around 49-50 truckloads. Domestic freight rates were steady.

Bombay Sugar Merchants Association`s spot rates: S-grade ruled at Rs 2,941-3,020 (Rs 2,944-3,015) and M-grade at Rs 3,006- 3,102 (Rs 3,001-3,122).

Naka delivery rates: S-grade Rs 2,885-2,920 (Rs 2,900 - 2,930) and M-grade Rs 2,975-3,020 (Rs 3,000-3,060).

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