Sugar hits 1-week low as crushing gains pace

MUMBAI: Indian sugar extended losses for a third day on Tuesday to drop to its lowest level in more than a week, as crushing gained pace in producing states and demand from retail and bulk consumers remained muted.

The key January contract on India's National Commodity and Derivatives Exchange ( NCDEX) was 0.43 percent lower at 3,277 rupees per 100 kg at 1018 GMT, after hitting a low of 3,271 rupees, a level not seen after Dec. 7.

"The trend is on the downside as crushing has gained pace, and there is last year's carry forward stock as well," said Shikha Mittal, an analyst with Karvy Comtrade in Hyderabad.

Selling is advised in sugar at 3,282-3,285 rupees, for a target of 3,250, with a stop-loss of 3,308 rupees, said Mittal.

Sugar fell 8.85 rupees to 3,306.15 rupees per 100 kg at the Kolhapur spot market in the top-producing Maharashtra state.

India is expected to decide on raising the import duty on the sweetener in a fortnight, Food Minister K.V. Thomas said, as lower prices in the world market made room for such imports in the past two months.

Indian sugar mills produced 4.9 million tonnes of the sweetener between Oct. 1 and Dec. 15, up 2 percent from a year earlier, a leading industry body said on Tuesday.