Informist, Tuesday, Mar 28, 2023
By Afra Abubacker
MUMBAI – Ex-mill prices of sugar rose today in key wholesale markets in north India, while they were flat in Maharashtra, dealers said.
Prices rose today as demand is expected to be higher in April, said Naresh Gupta, an Uttar Pradesh-based trader.
Sugar consumption is seen higher in April due to improved demand in Ramadan month and with the onset of summer, which is forecasted to be hotter-than-normal by India Meteorological Department.
Moreover, concerns over lower sugar production due to a drop in operational mills also supported sugar prices.
Maharashtra’s sugar commissioner Shekhar Gaikwad has cut down production estimate to 10.7–10.8 mln tn in 2022-23 (Oct-Sep), against the earlier estimate of 12.8 mln tn, according to media reports today.
In Maharashtra, the top producer of the commodity, around 113 mills were operational during Oct 1- Mar 15. About 184 mills were operating during the corresponding period last year, according to Indian Sugar Mills Association.
Mills are closing at an alarming rate. In the first week of April, only a few will be active, Gaikwad told media.
Mills are closing down as operations are no longer lucrative. Sugarcane yield and sugar recovery has dropped in the state after heavy rainfall in September, said Mukesh Kuvadia, secretary of the Bombay Sugar Merchants Association.
Following are the highlights of sugar trade in the domestic market:
–Up 20–30 rupees at 3,430-3,500 rupees per 100 kg in Muzaffarnagar
–Up 20–30 rupees at 3,480-3,525 rupees per 100 kg in Delhi
–Flat at 3,320-3,410 rupees per 100 kg in Kolhapur
–Flat at 3,480-3,620 rupees per 100 kg in Mumbai
At 1553 IST, the most-active May contract of raw sugar on the Intercontinental Exchange was up 0.7% at 21.07 cents per pound. Prices rose tracking a rise in crude oil contracts on the NYMEX.
A rise in crude oil prices prompts sugar mills in Brazil, the second-largest producer of sugarcane, to divert less cane towards production of sugar and more towards ethanol.
Sugar prices also rose due to concerns over lower production. On Monday, S&P Global Commodity Insights had cut its 2022-23 global sugar surplus estimate to 600,000 tn against the November estimate of 5 mln tn, due to weaker-than-expected global sugar production, Barchart said in a note. End
IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT
Edited by Maheswaran Parameswaran
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