Informist, Monday, May 22, 2023
By Sayantan Sarkar
MUMBAI – Ex-mill prices of sugar fell in key markets of north India and Maharashtra today due to a rise in supply of the sweetener as some mills rushed to meet their monthly sales quota, two traders said.
As the month of May is coming to an end, supply has risen as mills have released more sugar in the wholesale markets, said Naresh Gupta, a north India-based sugar trader, adding that demand for the sweetener remained steady.
The government had set the limit for sale of sugar by mills at 2.4 mln tn for May, which was unchanged from April.
India is the world's second-largest producer of sugar, behind Brazil. Sugar prices are closely monitored by the government as it is one of the key ingredients in the Indian diet and, hence, is a politically sensitive commodity.
Following are the highlights of sugar trade in the domestic market today:
--10-15 rupees down at 3,545-3,615 rupees per 100 kg in Muzaffarnagar
--5 rupees down at 3,475-3,525 rupees per 100 kg in Kolhapur
--5 rupees down at 3,625-3,717 rupees per 100 kg in Mumbai
At 1702 IST, the July futures contract of sugar on the Intercontinental Exchange was down 0.2% at 25.74 cents per pound.
The International Sugar Organization in its quarterly monthly report released today, scaled down its estimate for global surplus of the sweetener in 2022-23 (Oct-Sep) by 3.3 mln tn to 852,000 tn.
"Our fundamental view of the global supply-demand situation sees a substantially reduced surplus in the current season," the sugar body said in the report. It has also scaled down the global export availability estimate for 2022-23 by 65,000 tn to 63.9 mln tn.
"Lower crop estimates and export prospects in Thailand and India contributed to a bullish market sentiment, but it is the slowing of Brazilian exports in recent months that is potentially a more pronounced fundamental driver for the price rally," it said.
However, with nearly 47% of Brazil's exports in 2022-23 still to be realised from May to September, prospects of the modest 2022-23 surplus weighing on prices are yet to be proven, according to the report. End
US$1 = 82.83 rupees
Edited by Tanima Banerjee
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