Indian sugar mills association

Selling by mills drags sugar

Date:	03 Jan 2012

Source:	The Business Line

Reporter:	Bureau

News ID:	816

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Chennai, Jan. 2: Sugar prices dropped in markets across the country on Monday as selling pressure mounted on mills` eagerness to cash in on the price rise. A bit of technical correction, too, led to the trend.

In central Uttar Pradesh, sugar dropped to Rs 2,950-2,960 a quintal, down Rs 10.

“When prices run up by Rs 50-60, it should not surprise anyone when it falls by Rs 10. There were more sellers as prices had increased late last week,” said a trading source.

Sugar gained last weekend after the Centre announced the sale quota for this month. It has fixed 15 lakh tonnes as the quota for sale in the open market against 17 lakh tonnes in December.

In Mumbai, prices dropped as rising stocks forced mills to sell. Demand, on the other hand, is low in view of winter.

In Kolhapur, the S-30 variety dropped to Rs 2,860 a quintal.

One of the reasons for the selling pressure in Maharashtra is that crushing in the second largest producing State is in full swing. A Reuters report quoting an industry official said sugar production in Maharashtra increased 18 per cent in the first three months of the new season that began in October.

In the futures market, the January contract slipped to Rs 2,881 a quintal from Rs 2,885 on Saturday. February contract was up Rs 3 at Rs 2,901 and March contract gained Rs 6 at Rs 2,932.

Bombay Sugar Traders Association rates (Rs/quintal): S-30 sugar — 2,916-3,011 (2,942-3,021); M-30 sugar — 3,001-3,112 (3,021/3,122).

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