Sugar prices rise amidst tight supply, higher demand

Sugar prices in the country rose to a recent high with futures hitting a one-year high on Monday amidst tight supply and signs of further firming up of prices in the backdrop of a shorter crop.

The March sugar contract rose as much as 1.2 per cent to Rs3,946 a quintal on the National Commodity and Derivatives Exchange Ltd (NCDEX). The contract had gained nearly Rs200 in the last 30 days ended Friday last.

The March sugar futures ended up 0.3 per cent at Rs3,190 in heavy trading towards the close of market hours.

In the national capital, sugar prices climbed Rs60 per quintal to trade at nearly six-year high on the wholesale market following tight stocks position amid speculative buying by stockists and bulk consumers.

Marketmen said the tight stocks position was partly due to a pause in supplies by mills.

At the retail markets in the national capital, sugar prices were ruling higher at Rs45 to Rs50 per kg.

On the wholesale market, sugar ready M-30 and S-30 rose nearly Rs60 a quintal to Rs4,080-4,180 and Rs4,070-4,170 per quintal, respectively.

Likewise, mill delivery M-30 and S-30 were ruling higher by Rs50 each at Rs3,750-3,840 and Rs3,740-3,830 per quintal, respectively

The rise in sugar prices on the futures and spot markets triggered a rally in sugar stocks.

Dhampur Sugar Mills Ltd rose as much as 10.7 per cent to Rs214.80, its highest in over 10-1/2 years, while Shree Renuka Sugars Ltd closed 12.9 per cent higher at Rs17.10.