Sugar futures up on spot demand, hopes of more export

Sugar futures prices rose by 0.21% to Rs 2,866 per quintal today, as speculators enlarged their positions on the back of rising seasonal demand from bulk consumers at spot markets amid expectations that the government may allow more exports of the sweetener.

At the National Commodity and Derivatives Exchange, sugar for May delivery traded Rs 6, or 0.21%, higher at Rs 2,866 per quintal, with an open interest for 48490 lots.

The April contract also showed strength and gained Rs 4, or 0.14%, to Rs 2,930 per quintal, with an open interest of 22,590 lots.

Analysts attributed the rise in sugar futures to speculators creating positions in line with a firming trend at spot markets on rising demand from bulk consumers amid expectations that the government may allow more exports of the sweetener in the 2011-2012 marketing year (October-September) on hopes of increased production.

According to government estimates, the country is expected to produce 25.2 million tonnes of sugar in the current marketing year.