ChiniMandi Mumbai: After the announcement of sugar monthly release quota for September 2019 which is 19.5 LMT, the market sentiments reacted very positively and prices jumped Rs.100 to Rs.120/Qntl.
September month’s quota is likely to extend the sweetness in the market as the festive season kicks in which increases demand in the market. Sugar millers across the country have been striving hard to sell sugar for the past couple of months and improve their cash flow along with the financial position which has been influenced by weak demand, cane arrears and monsoon conditions.
Recently, the Government approved creation of sugar buffer stock of 40 LMT that would enable to maintain the demand supply balance, stabilize the prices of sugar and to improve the liquidity position of the sugar mills to clear the sugarcane arrears.
An export assistance of ₹10,448/MT to sugar mills for the sugar season 2019-20 was also announced. The assistance will be provided for expenses on back of marketing costs including handling, upgrading and other processing costs, costs of international and internal transport and freight charges on sugar export of up to 60 LMT of sugar limited to MAEQ allocated to sugar mills for the sugar season 2019-20.
Overall looks like the “Achche Din” of the sugar industry have begun. Two back to back monthly releases a tag lower than the demand ensures demand remains more than the supply and mills have active sales counter. Similarly, being festive season, consumers look forward to store sugar more than the requirement to cater the festive demand. With the recent announcements, it seems to be a win win situation for Industry and the Government especially ahead of the Maharashtra State Elections as the state economy and politics runs in parallel with sugarcane and sugar mills economy.
According to marketmen, today, in Maharashtra the rates for S/30 sugar are Rs.3200 to Rs.3300/Qntl, in Gujarat the rates for S/30 are Rs.3250 to 3280/Qntl and M/30 Rs.3350 to 3400/Qntl are, in Uttar Pradesh the rates for M/30 are Rs.3450 to 3500/Qntl. (All rates are excluding GST)
In the previous month the Govt. allocated 19 lakh MT monthly sugar quota in August to 535 mills in the country.
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