Indian sugar rises on hopes of import duty hike

November 21, 2013

Indian sugar futures drop
Indian sugar futures drop

Indian sugar futures rose on Wednesday from their lowest level in nearly one-and-a-half years on hopes the government would raise import duty on the sweetener and also due to a delayed crushing season in key producing states. The key December contract was up 0.78 percent at 2,829 rupees ($45.26) per 100 kg on the National Commodity and Derivatives Exchange at 0840 GMT. It fell to 2,801 rupees in the previous session, its lowest since June 8, 2012.

“The government has to do something to break the deadlock between farmers and mills. It may raise import duty. It can provide financial assistance to mills in the form of cheaper loans or exports subsidy,” said a Mumbai-based dealer. Sugar cane crushing normally starts in the first week of November in Maharashtra and Uttar Pradesh, the country’s top two producing states. But this year it has been delayed as farmers and mills could not reach an agreement over the cane price. India started the new sugar marketing year with carry-forward stocks of 8.8 million tonnes. It is expected to produce 25 million tonnes this year against a demand of 23 million tonnes.

Courtesy Reuters

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