Domestic sugar prices have taken an uptrend since the last 3 days driven by aggressive offers and lifting. Marketmen spotted fresh buying and are confident of demand picking with the dawn of the most auspicious Hindu month Shravan followed by major Hindu festivals as well as the pipeline filling after a long gap of emptiness. The ease in many state imposed-lockdowns has also brought in demand. Prices have witnessed an upswing of average ₹80 to 100/quintal nationwide after depressed prices for 7 constant months.
State wise Prices as on 2nd August 2021:
◾ Maharashtra:S/30 Sugar rates from millers are ₹3120 to ₹3155/Qntl. whereas M/30 ₹3180 to 3250/Qntl.
◾ Karnataka : S/30 Sugar rates were ₹3160 to 3220/Qntl. whereas M/30 is trading at ₹3200 to ₹3230/Qntl.
◾ Uttar Pradesh: The rate for M/30 is ₹3325/Qntl.
◾ Gujarat: S/30 Sugar rates are ₹3125 to 3141/Qntl. whereas M/30 rates are at ₹3221 to 3241/Qntl.
◾ Tamil Nadu: S/30 Sugar rates are ₹3325 to 3350/Qntl. whereas M/30 rates are at ₹3375 to 3400/Qntl.
(All the above rates are excluding GST)
Speaking on the development in the market, an Uttar Pradesh based trader who wishes to remain unidentified said, “The prices have taken an upward trend of ₹100/quintal after the announcement of the quota for the month of August 2021. Buyers have been showing a thumbs up for profit-booking basis today’s prices. Due to the active bookings for rakes from the Northern region, it won’t be a surprise to see sugar prices in Maharashtra and Karnataka going even higher by ₹30 to 50/quintal.”
In conversation with Chinimandi.com, Mr. A T Mohan a prominent trader from Tamil Nadu and Owner, M.A.T Sons commented, “Notable sourcing for rakes from Kolkata has also been observed in regions of Maharashtra which has created tightness in the market. The demand is quite good after a long time. Prices look to remain firm in the coming days.”
Domestic sugar prices have been depressed in the wake of surplus sugar production for sugar season 2019-20 and 2020-21. Millers have been liquid-strapped given the depressed ex-mill prices along with harming the capability of paying cane dues in the given time. The recent fresh buying and growing demand is a sweet indication to millers, yet millers eagerly yearn for the hike in Minimum Selling Price (MSP) of sugar.
Sharing views on sugar price uptrend, Mr.Yogesh Patil – Executive Director & CFO at Athani Sugars asserted, “This is a temporary surge in price on lower monthly releases and would be limited to the current month. However, there is a need to increase MSP to minimum ₹3450 per quintal for a sustainable sugar business model considering current FRP and other increased costs.”
The spokesperson of eBuySugar.com a privately-owned sugar trading portal commented, “There has been a good volume of trades taking place. Considering the previously announced monthly release orders, the quota for August has been moderately lower which would keep the market tight considering the routine demand from institutional buyers and new buying owing to festivals round the corner.”
On 29th July 2021, DFPD allocated 21 LMT monthly quota for sugar sale in the domestic market during August 2021 which is lower than that announced in the previous four months which has been 22 LMT.
With major movements taking place in the market in the last 2 to 3 days, stakeholders are left in a nail-biting position to see how the market sentiments remain ahead.