Sugar down 0.6% on profit-booking

Commodity for delivery in August also traded lower by 0.48%

Snapping its two-day rising streak, sugar prices fell by 0.58% to Rs 3,110 per quintal in futures trade today as speculators locked-in gains at prevailing higher levels.

In addition, stabilising prices at the wholesale markets, following pick-up in supplies also influenced the prices of the sweetener.

At the National Commodity and Derivatives Exchange, sugar for delivery in July eased by Rs 18, or 0.58%, to Rs 3,110 per quintal with an open interest of 29,290 lots.

The sweetener for delivery in August also traded lower by Rs 15, or 0.48%, to Rs 3,140 per quintal in 27,610 lots.

Analysts said apart from profit-booking by speculators on recent gains after the government announced a slew of measures, increased arrivals at the wholesale markets in the capital, put pressure on sugar prices in futures trade.

They said, however, summer season demand from bulk consumers, capped the losses.

Meanwhile, the government earlier this week decided to hike the import duty on sugar to 40% and provide an additional interest-free loan of up to Rs 4,400 crore to sugar mills to enable the cash-starved industry pay their huge arrears to cane farmers.

Besides, export subsidy will be extended till September this year to give relief to the sugar industry, which owes Rs 11,000 crore to cane growers, largely from Uttar Pradesh.