Mumbai: Spot sugar ended steady in thin trade on Tuesday due to weak demand and as millers held on to higher prices, dealers said.
“Mills have raised prices, but demand is not coming at these levels. Buyers are sceptical about mills ability to hold prices at current levels,” said Harakhchand Vora, vice president of the Bombay Sugar Merchants Association.
Millers on last Thursday decided to raise prices of the sweetener by 4-6% in an attempt to trim losses after prices fell below cost of production.
Demand, however, has slipped from the summer months as buying by bulk consumers such as ice cream and beverage makers slowed.
In Kolhapur, a key market in top producer Maharashtra, the most traded S-variety sugar nudged down by 0.06% to Rs2,726 ($58.5) per 100 kg.
India’s sugar stocks at the start of the new season in October will rise to 5.9 million tonnes, the Indian Sugar Mills Association (ISMA) said last week.
Cane growing states like Maharashtra, Uttar Pradesh and Karnataka received good rains in past three days and are likely to get more rains this week, weather department said.
Sugarcane acreage in India has risen by 18.6% to 5.28 million hectares in 2010-11, the ISMA said in a statement on 26 July.
The world’s biggest consumer is likely to produce 25.5 million tonnes of sugar in 2010-11, compared to 18.8 million tonnes in the current year ending in September.
New York raw sugar futures climbed to a four-month high in early trade on Tuesday, boosted by chart-based buying and further shipment delays in Brazil.