Informist, Monday, Nov 6, 2023
By Taniva Singha Roy
MUMBAI – Ex-mill prices of sugar in the key markets of Uttar Pradesh fell marginally today due to an increase in the supply of good quality sweetener. In Maharashtra, prices remained steady due to adequate supply, said traders.
Prices of sugar in Uttar Pradesh fell by 5-10 rupees per 100 kg today, with the downward trend in prices continuing for the second successive week. As most mills in the state have started crushing and producing new stocks, availability has increased, dragging down prices, said Naresh Gupta, a trader from north India.
In western Uttar Pradesh, most mills are selling new stock, but in central parts, mills are still clearing off their old stock as the new stock is yet to arrive. “Central Uttar Pradesh generally witnesses delayed crushing, and production of sugar depends on factors such as ripening of the cane, and the time taken for the cane to be ready for crushing varies on the climate,” Gupta said.
He added that the price of new sugar is about 30-40 rupees per 100 kg more than the old stock. However, by the second week of November, around 80% of mills in Uttar Pradesh will start production, and supply of good quality sugar will increase and prices might fall.
Prices are also likely to pulled down by subdued demand after Diwali.
In Maharashtra, the price of the sweetener remained unchanged as demand and supply were balanced, said Mukesh Kuvadia, the secretary of the Bombay Sugar Merchants Association.
Prices are likely to remain steady for the next few days as the sales quota of 1.5 mln tn for the first tranche of November is adequate and Diwali being just a few days away, an increase in demand is unlikely as the festival demand has already been met, Kuvadia added.
Further, he said that mills in Maharashtra were still selling the old stock of sugar as the new stock would be released for sale only after production was complete.
The following are highlights of the sugar trade in the domestic market today:
-Flat at 3,876-3,990 rupees per 100 kg in Mumbai
-Flat at 3,730-3,805 rupees per 100 kg in Kolhapur
-Down by 5 to 10 rupees at 3,960-3,970 rupees per 100 kg in Muzaffarnagar
-Down by 5 to 10 rupees at 3,860-4,000 rupees per 100 kg in Kanpur
On the Intercontinental Exchange, the March sugar contract was at 27.96 cents a pound, up 0.2% from the previous close.
Sugar prices rose in the global market rose, tracking a rise in crude oil prices. Sugarcane is used for the production of ethanol, which is used for blending with fuel.
On Oct 23, the International Sugar Organisation had forecast that global sugar production in 2023-24 (Oct-Sep) would fall 1.2% to 174.8 mln tn, and a global sugar deficit of 2.1 mln tn was likely in 2023-24, according to barchart.com.
Expectations of tighter global sugar supplies are supportive for prices. End
US$1 = 83.21 rupees
Edited by Avishek Dutta
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