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Sugar prices, which are affected by the ongoing strike by traders and a tepid demand, are likely to go up soon due to high temperature.
Sugar merchants said mills are selling at a price below their cost of production to pay farmers their dues.
Demand for sugar is tepid after Diwali but the supply is ample. Once the strike gets over, demand from traders is expected to spurt due to high temperature.
Sugar prices on the domestic futures markets ruled weak till Friday noon after rising about Rs 75 in last two days on profit booking .
Vashi spot market remained closed for 10th consecutive day in protest of Local Body Tax so there were no activities or arrivals – dispatches.
Millers sold sugar through tender of Rs 10-15 higher to State level markets barring Mumbai and few other cities.
Tracking firm notes from futures market mill tender rates have gone up by Rs 25-30 in the last two days.
On Thursday, 14-15 mills offered tenders and sold about 68,000-70,000 bags at Rs 2,950-3,030 (Rs 2,930-3,010) for S-grade and Rs 3,020-3,070 (Rs 3,010-3,060) for M-grade.
On the NCDEX, sugar June futures dropped by Rs 2 to Rs 3,028 , July contracts declined by Rs 9 to Rs 3,063 and August by Rs 5 to Rs 3,124 till noon.
In world market, increased selling by Thailand and Brazil pulled down August futures to $486.20 ($487.20) and October at $489.60 ($489.20) on Thursday.
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