Indian sugar mills association

Local demand turns trend in sugar

Date:	28 Feb 2012

Source:	The Business Line

Reporter:	BL Correspondent

News ID:	946

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Mumbai, Feb. 27: Bearish sentiment was brought to a halt at the sugar market on Monday with prices rising Rs 10-15 for fine quality at spot and naka level.

Mill tender rates were up by Rs 10-15 on improved local demand. Market sources said the sentiment turned bullish on expectations of higher retail demand from Wednesday. Local dispatch was higher than arrival due to higher demand. The Vashi APMC Market will remain closed on Tuesday in support of a bandh.

Mr Jagdish Rawal of B. Bhogilal and co said improved overall demand helped reverse the bearish trend. With temperatures rising across the country, domestic and commercial consumption are expected to rise in coming days.

Free sale quota for March is expected to announcement soon. Even a marginal raise in quota against current month will be absorbed by an increase in demand, keeping the sentiment firm.

Sources said selling pressure at mill level for exhausting current month`s free sale quota has been eased by higher dispatches. Prices at other producing centres also improved.

Currently, the Vashi market carries an inventory of about 100-120 truckloads (each of 100 bags). Last year for March, a total 16.84 lakh tonnes declared for free sale. Market traders are expecting higher quota than the last two months on higher production this year.

Emerging opportunities for sugar exports will support firm sentiment in coming days. World sugar prices have been improving since last week. At the international market, May-12 futures closed higher to $661.40 ($652.20) and August-12 futures closed to $637.50 ($628.60) on Friday.

Arrivals in the Vashi market were 50-52 truckloads and local dispatches were around 54-55 truckloads. On Saturday evening, about 24-25 mills sold more than one lakh bags in the range of Rs 2,730-2,800 (Rs 2,730-2800) for S-grade and Rs 2,840-2,880 (Rs 2,840-2,880) for M-grade. Mill tenders were expected slightly up on higher demand.

Bombay Sugar Merchants Association`s spot rates: S-grade Rs 2,872-2,942 (Rs 2,872-2,932) and M-grade Rs 2,986- 3,036 (Rs 2,981- 3,026).

Naka delivery rates: S-grade Rs 2,815 - 2,880 (Rs 2,830-2,860) and M – grade Rs 2,935-3,000 (Rs 2,940-2,990).

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