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Sugar futures on the NCDEX closed lower by 0.25 per cent at Rs 3,546 a quintal on reports of an increase in raw sugar imports. However, sugar prices in the Kolkata spot market were up 0.26 per cent at Rs 3,850 on the back of improved demand ahead of the festival season.
Sugar mills signed deals to import about 4,50,000 tonnes of raw sugar from Brazil between October and December as the gap between domestic and overseas prices widened, making imports viable after a gap of two years.
The Centre has deferred its decision to slash the subsidy on sugar bought from the public distribution system (PDS). There were expectations that the Government would increase the price of sugar distributed through the PDS to cut subsidies. Currently, the Government sells sugar at a subsidised rate of Rs 13.50 a kg through the PDS. On the other hand, it is bought at Rs 19.50 a kg from millers.
With opening stocks of six million tonnes, domestic sugar supplies are estimated at 30 million tonnes against demand of about 23 million tonnes for 2012-13.
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