Sugar prices dropped further by Rs 20-30 a quintal at the Vashi spot market on Thursday on rising supply and poor local demand. The Union Government’s warning to mills to sell non-levy quota of October-November in time or face consequences has dragged down the physical and futures markets. The free-sale quota for October-November is 40 lakh tonnes. Naka rates fell by Rs 30-40 for S-grade and by Rs 10-15 for M-grade. Mill tender rates slipped further by Rs 20-30 on need-based demand. Because of lower demand, fewer mills offered tenders on Wednesday evening, a wholesaler in Vashi said. The Navaratri demand is now almost over and Diwali buying is expected to rise from the first week of November. Demand from neighbouring States is still low in Maharashtra, forcing producers to sell in local markets. Stockists are not buying the market already has more than 10,000 bags in store currently. The Government may raise import duty on white sugar and scrap duty on raw-sugar imports in the next 10-15 days, Food Minster K.V. Thomas said on Thursday. “We have received different proposals as far as duty on sugar is considered. One is to increase duty on white sugar to 20 per cent and other is to scrap duty on raw sugar import,” Thomas said. “We will take a final call after discussions with the Commerce Ministry, and then move a proposal to the Cabinet in 10-15 days,” he said.
Import of both raw and white sugar attracts 10 per cent Customs duty, and sugar processed from imported raw sugar also attracts 10 per cent levy. There is a mismatch between the import tariffs on raw and white sugar, which needs to be corrected, a commodity observer said.
On the National Commodities and Derivatives Exchange, November contracts were at Rs 3,324 (Rs 3,342), December Rs 3,295 (Rs 3,315) and January at Rs 3,331 (Rs 3,344) at noon.
In Vashi, 68-70 truckloads (each of 100 bags of a quintal each) arrived and 64-65 truckloads were despatched locally. On Wednesday evening, 10-12 mills offered tenders and sold merely 24,000-25,000 bags to local traders at Rs 3,380-3,430 (Rs 3,400-3,450) for S-grade and at Rs 3,440 - 3,530 (Rs 3,470-3,560) for M-grade.
Bombay Sugar Merchants Association’s spot rates: S-grade Rs 3,512-3,571 (Rs 3,526-3,582) and M-grade Rs 3,582-3,702 (Rs 3,611-3,701).
Nakadelivery rates: S-grade Rs 3,460-3,510 (Rs 3,500-3,540) and M-grade Rs 3,540-3,660 (Rs 3,550-3,660).