Sugar futures slide at NCDEX counter

"Selling pressure from sugar mills to clear off the allotted quota and sluggish demand for the sweetener caused downfall in futures prices," an analyst with Karvy Comtrade said.     
At 1200 hrs, almost all six contracts in Sugar M 200 grade slipped at country's largest agri commodity exchange NCDEX in the range of 0.30-0.90 per cent.

May contract was down by 0.45 per cent at Rs 1,341 per quintal, June contract slipped by 0.49 per cent at Rs 1,379 per quintal, while September contract slumped by 0.90 per cent by Rs 1,552 per quintal.     

While six contracts under Sugar S 150 grade were also bearish. May contract slided by 2.09 per cent at Rs 1,379 per quintal.    

The government has released 4.4 million tonnes of non-levy sugar for April-June quarter. Besides, it also allowed sugar factories to sell two million tonnes in the domestic market from buffer stock.

During 2007-08 sugar season, beginning May, mills have to sell two million tonnes of buffer stock. In order to bail out sugar industry that is facing a glut since 2006-07 season, the government had created a buffer stock of five million tonnes.    

Consequently, the pressure is mounting on sugar mills to sell sweetener, but unfortunately there is hardly any demand for the commodity currently, a trader said.     

However, at MCX counter, May contract was trading firm at Rs 1,500 per quintal, up by 2.46 per cent.     

Total consumption in the country stands at 20 million tonnes annually. Sugar production is estimated to be nearly 27 million tonnes in 2007-08 season, against 28.3 million in a year ago period.