Informist, Friday, Sep 1, 2023

By Afra Abubacker

MUMBAI – In key markets of north India, ex-mill prices of sugar rose slightly today, while in Maharashtra, prices were flat from Thursday, said dealers.

Prices rose slightly today in Uttar Pradesh due to lack of a selling pressure in the market, said Naresh Gupta, a dealer from the state.

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 quota for the previous month. Market players had expected the September sales quota along the same lines as August. 

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

--Up 10 rupees at 3,700-3,750 rupees per 100 kg in Muzaffarnagar

--Up 10 rupees at 3,730-3,800 rupees per 100 kg, in Kanpur

At 1457 IST, the October sugar contract on the Intercontinental Exchange was at 25.25 cents per pound, up 1% from the previous close. On Wednesday, the contract hit a two-month high of 25.90 cents.

Sugar prices rose today due to growing concerns over the sweetener's production in India amid El Nino conditions. 

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 and other Asian countries.

Sugarcane is a highly water-intensive crop with about 250 tn of water required to produce 1 tn of the crop, as per data from the Directorate of Sugarcane Development. 

Further, reports of possible export restrictions from India, amid a shortfall in production, also aided prices. According to the 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.

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.  End

Edited by Manisha Baxla

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