Indian sugar mills association

Sugar surges on Govt move to allow more exports

Date:	08 Feb 2012

Source:	The Business Line

Reporter:	Our Correspondent

News ID:	910

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Sugar prices rose sharply by Rs 20-30 a quintal on the Vashi wholesale market on Wednesday. The Centre`s decision to allow additional exports of 10 lakh tonnes for the current season fuelled the sentiment.

Few mills offered tenders, leding to a sharp rise of Rs 30-40 innakadelivery rates. Mill tender rates improved by Rs 10-15 for new stocks but were under pressure due to decline in domestic futures market.

Market sources said as producers offered old season produce at lower rates, mill tender rate was steady with limited increase of Rs 10-15. A wholesaler said the announcement of additional exports will have short-term affect on sentiments, as India is still to complete 10 lakh tonnes of shipments permitted in November last. Of this, between October and last week, export release orders were issued for 8.54 lakh tonnes. Now an additional 10 lakh tonnes export permission will ease the burden of stocks for the producers if the world market continues its bull trend. Domestic sugar future prices erased previous day`s rise of Rs 30-35 on Wednesday.

Global scenario Analysts said world sugar futures closed higher as speculators bought on hopes of better demand potential and as bad weather in Europe and Russia created logistical problems. Plenty of supplies are available in the market, and more could be coming. European economic problems are reasons to worry about demand. In the world market, sugar futures prices continued their bull run on the forth consecutive day with a rise of more than $4 a tonne. Arrivals in Vashi market were 52-53 truckloads and local dispatches were around 47-48 truckloads. On Tuesday, only 4-5 mills offered tenders ahead of centre`s meeting and sold about 30,000–35,000 bags in the range of Rs 2,800-2,860 (Rs 2,810-2,850) for S-grade and Rs 2,890-2,950 (Rs 2,900-2,950) for M-grade.

The Bombay Sugar Merchants Association`s spot rates: S-grade Rs 2,931-2,982 (Rs 2,912-2,961) and M-grade Rs 3,031- 3,102 (Rs 2,991- 3,091).

Nakadelivery rates: S-grade Rs 2,900-2,970 (Rs 2,860-2,940) and M-grade Rs 3,020-3,080 (Rs 2,970-3,060).

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