Sugar up 0.4% on strong demand, lower output

Commodity for delivery in April moved up by 0.37%

Maintaining its rising streak, sugar prices rose further by 0.46% to Rs 3,266 per quintal in futures market today as speculators engaged in enlarging positions, driven by summer season demand from bulk consumers amid drop in production.

At the National Commodity and Derivatives Exchange, sugar for delivery in May gathered Rs 15, or 0.46% to Rs 3,266 per quintal with an open interest of 49,410 lots.

On the similar lines, the sweetener for delivery in April moved up by Rs 12, or 0.37% to Rs 3,223 per quintal in 22,620 lots.

Analysts said apart from rising demand in the spot markets from bulk consumers following beginning of summer season, fall in sugar production supported the persistent rise in sweetner prices at futures trade.

The country's sugar production has dropped by 7% to 21.5 million tonnes in the first six months of the current marketing year due to lower output in key producing states.

Meanwhile, at Mumbai's Vashi wholesale market Medium sugar (M-30) rose by Rs 29/46 to Rs 3,351/3,502 per quintal in yesterday's trade, while Small Sugar (S-30) firmed up by Rs 20 to Rs 3,226/3,352 per quintal.