Rising sugar prices dampen festive cheer
Sugar prices continued to rule higher in the spot market on Monday despite Govt flooding the market with 500,000 tonnes of the sweetener, but festival season demand appears to have soaked up the surge in supply.
By PTI |
NEW DELHI : Sugar prices continued to rule higher in the spot market on Monday despite the government flooding the market with 500,000 tonnes of the sweetener, but festival season demand appears to have soaked up the surge in supply.
Sugar prices rose by about 3% both at the spot as well as futures market.
The wholesale price jumped to Rs 1,885 per quintal from Rs 1,831 on August 9. A similar trend was witnessed in the futures market, where August contract hit upper level of 3%.
The August contract at NCDEX counter rose by 3.7% to Rs 1,821 per quintal at 17:00 pm IST. September delivery rose by 3.3% at Rs 1,845 a quintal and October contract by 3.5% at Rs 1,884 per quintal.
In a statement issued last Saturday, the food ministry said: ���In the last few days prices of non-levy sugar in the open market have increased in spite of much higher availability of sugar in the September quarter, compared to last year���.
���Good buying ahead of festivals like Raksha Bandhan is weighing on prices,��� said an analyst with Religare Commodities. The futures prices should take correction in the short term, he said.
Traders attributed increased demand ahead of festival season for the rise in prices in the spot market.
A sustained enquiries from retailers ahead of Raksha Bandhan pushed sugar prices on the Vashi wholesale market too. Medium sugar (M-30) rose Rs 25/55 to Rs 1,940/2,000. Small sugar (S-30) also firmed up by Rs 30/31 to Rs 1,900/1,950 per quintal.
The government announced on Saturday that it would release 500,000 tonnes of sugar for August and September to contain price rise. It has fixed the free sale quota of 900,000 tonnes for the current month.
For the ensuing 2008-09 sugar season, the government estimates production at 220 lakh tonnes, with a possibility of 5-7% increase if the weather condition remains favourable.
According to the estimates, the closing stock at the end of current 2007-08 sugar season would be around 110 lakh tonnes, taking the total availability in 2008-09 season at 330 lakh tonnes.
Sugar prices rose by about 3% both at the spot as well as futures market.
The wholesale price jumped to Rs 1,885 per quintal from Rs 1,831 on August 9. A similar trend was witnessed in the futures market, where August contract hit upper level of 3%.
The August contract at NCDEX counter rose by 3.7% to Rs 1,821 per quintal at 17:00 pm IST. September delivery rose by 3.3% at Rs 1,845 a quintal and October contract by 3.5% at Rs 1,884 per quintal.
In a statement issued last Saturday, the food ministry said: ���In the last few days prices of non-levy sugar in the open market have increased in spite of much higher availability of sugar in the September quarter, compared to last year���.
���Good buying ahead of festivals like Raksha Bandhan is weighing on prices,��� said an analyst with Religare Commodities. The futures prices should take correction in the short term, he said.
ADVERTISEMENT
Traders attributed increased demand ahead of festival season for the rise in prices in the spot market.
A sustained enquiries from retailers ahead of Raksha Bandhan pushed sugar prices on the Vashi wholesale market too. Medium sugar (M-30) rose Rs 25/55 to Rs 1,940/2,000. Small sugar (S-30) also firmed up by Rs 30/31 to Rs 1,900/1,950 per quintal.
The government announced on Saturday that it would release 500,000 tonnes of sugar for August and September to contain price rise. It has fixed the free sale quota of 900,000 tonnes for the current month.
For the ensuing 2008-09 sugar season, the government estimates production at 220 lakh tonnes, with a possibility of 5-7% increase if the weather condition remains favourable.
ADVERTISEMENT
According to the estimates, the closing stock at the end of current 2007-08 sugar season would be around 110 lakh tonnes, taking the total availability in 2008-09 season at 330 lakh tonnes.
Too busy to trade in stocks? Invest in Mutual Funds with ET Money!
Bookmark or read stories offline -
Download ET Markets APP
Download ET Markets APP
ADVERTISEMENT
