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Friday, February 3, 2023

India Sugar:Flat across mkts; up on ICE tailing NYMEX crude contracts

Informist, Thursday, Jan 5, 2023


By Puja Das


NEW DELHI – Ex-mill prices of sugar were flat in key markets of India today amid limited supply while poor demand for the commodity capped the upside, dealers said.


* In north India, prices stabilised after falling for about 40-50 rupees per 100 kg this month, said Naresh Gupta, an Uttar Pradesh-based trader.


* Subdued demand amid prevailing cold waves may pull down prices further in north India. However, demand may improve from Jan 10 on account of Makar Sankranti, which will limit the downside in prices, Gupta said. 


* In Maharashtra, prices may be supported by a likely improvement in demand for Sankranti and Pongal, Mukesh Kuvadia, secretary of the Bombay Sugar Merchants Association, said.


* The price movement, however, depends on demand, which will likely improve once temperature begins to rise from February. It also depends on India’s production and extent of the sugar export quota in the second tranche, Kuvadia said.


Following are the highlights of sugar trade in the domestic market:

–Unchanged at 3,380-3,460 rupees per 100 kg in Muzaffarnagar

–Unchanged at 3,450-3,520 rupees per 100 kg in Delhi

–Unchanged at 3,280-3,395 per 100 kg in Kolhapur

–Unchanged at 3,452-3,612 rupees per 100 kg in Mumbai


* On the Intercontinental Exchange, the most-active March contract of raw sugar was up 0.1% at 19.56 cents per pound tracking gains in crude oil contracts on NYMEX.


* A rise in crude oil prices prompts sugar mills in Brazil, the second-largest producer of sugarcane, to divert less cane towards sugar production and more towards ethanol. Less production means a crunch in supply, which pushes sugar prices higher.


* Concerns over low cane yields in key producing states of India also supported prices of the soft commodity. In 2021-22, India pipped Brazil to become the world’s largest producer and the second-largest exporter of sugar with a production of 35.9 mln tn. Brazil produced about 32 mln tn in the season. End


Edited by Tanima Banerjee



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Source: Cogencis

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