Informist, Thursday, Aug 31, 2023
By Afra Abubacker
MUMBAI – Ex-mill sugar prices were largely flat today in key markets of north India and Maharashtra, said dealers.
“Prices are largely the same today…there was not much of a movement as many mills are closed on Raksha Bandhan,” said Naresh Gupta, an Uttar Pradesh-based dealer. “Market will reopen entirely on Friday,” Gupta said.
On Tuesday, the government set the limit for sale of sugar by mills at 2.50 mln tn for September, down 50,000 tn from the previous month quota.
Following are highlights of the sugar trade in the domestic market today:
–Flat at 3,792-3,876 rupees per 100 kg in Mumbai
–Flat at 3,620-3,720 rupees per 100 kg in Kolhapur
–Flat at 3,690-3,740 rupees per 100 kg in Muzaffarnagar
–Flat at 3,710-3,790 rupees per 100 kg, in Kanpur
At 1457 IST, the October sugar contract on the Intercontinental Exchange was at 25.55 cents per pound, up 1% from the previous close. On Wednesday, the contract hit a two-month high of 25.90 cents.
Prices were up due to concerns over sugar supply from India because of a shortfall in production. According to Indian Sugar Mills Association, sugar output in 2023-24 (Oct-Sep) is estimated at 31.7 mln tn, down 3.4% from 32.8 mln tn in the ongoing season.
Reports of possible export restrictions from India also aided the upside in prices. India is the second-largest producer and exporter of sugar, after Brazil. India has allowed sugar exports of 6.1 mln tn for the current season ending Sep 30. Exports of the sweetener were at a record 11.1 mln tn last year.
Further, a prolonged lull phase in monsoon season in India amid forecasts of El Nino conditions tightening grip during the second half of September also aided prices.
El Nino, a natural climate phenomenon marked by warmer-than-average sea surface temperatures in the central and eastern Pacific Ocean near the equator, is typically associated with lower monsoon rains in India.
Sugarcane is a highly water-intensive crop with about 250 tn water required to produce 1 tn of the crop, as per data from the Directorate of Sugarcane Development.
Since Jun 1, Maharashtra has received 11% below-normal rain at 720.90 mm, and Uttar Pradesh got 497.5 mm rain, 16% below normal, India Meteorological Department data shows. Both the states are top sugarcane growers. End
Edited by Deepshikha Bhardwaj
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