Indian sugar mills association

Resale pressure, higher supply drag sugar

Date:	03 Mar 2012

Source:	The Business Line

Reporter:	BL Correspondent

News ID:	962

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Mumbai, March 2: Sugar prices on the Vashi wholesale spot market declined by Rs 10- 15 on Friday due to higher arrivals and resale pressure. Naka rates dropped by Rs 30 a quintal due to heavy selling by re-sellers to meet their advance purchases due by March 5 and 10. The futures market saw a decline of Rs 25 – 30 till noon.

Despite a cautious mood in spot and naka level, mill tender rates ruled slightly firm as producers were not keen to sell at lower prices. Retail demand improved but heavy arrivals meant there was pressure on the physical market, a wholesaler said.

Sources at B. Bhogilal and Company said that considering that free sale quota for this month was lower by 50,000 tonnes and start of summer is around, signs are positive for the market.

Sugar consumption is expected to rise in coming days. Bulk consumer demand, especially from the cold drinks sector, will also improve.

Analysts said that due to lifting pressure, prices had declined for a short while but in coming days market may see a positive trend.

Arrivals in Vashi market were higher at about 60-62 truckloads and dispatches were about 55-56 loads. On Thursday, about 19-20 mills offered tenders and sold 85,000 – 90,000 bags in higher range of Rs 2,770-2,850 (Rs 2,760-2,840) for S-grade and Rs 2,880-2,950 (Rs 2,880-2,940) for M-grade.

Bombay Sugar Merchants Association`s spot rates: S-grade Rs 2,906-2,972 (Rs 2,912-2,972) and M-grade Rs 2,992 - 3,061 (Rs 3,001- 3,071).

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