Sugar futures hits lower circuit on govt stock curbs

Sugar futures today hit the lower circuit and plunged by three per cent as traders indulged in reducing their positions following the government's decision to impose a limit on the sugar stocks held by a trader.

On the National Commodity and Derivatives Exchange, the sweetener for March contract fell sharply by three per cent to hit the lower circuit at Rs 2,123 per quintal in a turnover of 26,730 lots.

Similarly, the April-month contract for sugar also traded three per cent down at Rs 2,162 per quintal in a turnover of 18,520 lots, while far-month May contract lost 2.32 per cent at Rs 2,236 per quintal with a turnover of 4,890 lots.

Market analysts said the government's decision to impose a limit on the stocks of sugar a trader can keep to check possible hoarding of the sweetener and improve availability of sugar in the market, triggered fresh sell-off by speculators at futures market here.

The Cabinet yesterday approved imposition of a stock holding and turnover limit on sugar for four months.