Gur prices may crash on bumper cane crop
Gur prices in the spot market are expected to move down 25% by November-end on expectations of robust sugarcane arrival for ’06-07.
By TNN |
MUMBAI: Gur prices in the spot market are expected to move down 25% by November-end on expectations of robust sugarcane arrival for ’06-07. Gur is mainly used in foods and sweetmeats, apart from ayurvedic formulations. Wholesale prices in the Mumbai market are currently ruling at Rs 22-27 per kg.
“The downward trend in gur prices has already begun and by end-November these will be under further pressure,” said Dipak Shah, president, The Bombay Gur Merchant Association, adding “Stockists will also be under pressure to liquidate their current stocks.”
Sugarcane production in ’06-07 (October-September) is projected to be 20% higher over the previous year’s crop at 228m tonnes. Mr Shah said the new crop had already started arriving in parts of Maharashtra — Sangli, Pune and Baramati — and at Mandya in Karnataka. Conversion to jaggery has already begun in these areas, he said. Uttar Pradesh, another major jaggery producer, will see arrivals start by September 15, especially in western UP.
The futures price of gur, however, is moving up, reflecting fears that quality of stock in Muzzafarnagar warehouses might not be up to the mark and also factoring increased demand due to the festival season, said a Mumbai-based broker. The last traded price of the contract for September delivery on Tuesday at Rs 554.6 per 40 kg was Rs 11 higher over Monday’s close of 543.6.
The spot price at Muzzafarnagar, quoted on the NCDEX web site at the time of going to press, was Rs 544.4 per 40 kg, working out to around Rs 13.6 a kg, which is substantially lower than Mumbai spot wholesale prices.
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The prices in Maharashtra quote at a premium to UP prices mainly because of higher quality which is in turn influenced by factors such as sugarcane and soil types. Too busy to trade in stocks? Invest in Mutual Funds with ET Money!
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