Sugar

The government has imposed stock holding limits on sugar mills for the months September and October. Sugar mills can hold up to 21% of the total sugar supply of 2016-17 (Oct-Sep) season as of end of September, and 8% of the supply as of end of October. Paswan also said that there is no shortage of sugar for domestic consumption. Stock limit has been introduced to keep prices of sugar in check with a slew of festivals lined up for the next few months

Prices of sugar fell in the key wholesale markets of the country as implementation of stock holding limit on mills dampened the sentiment for the commodity. Government has imposed stock holding limits on sugar mills for September and October. Sugar mills can hold up to 21% of the total sugar supply of 2016-17 (Oct-Sep) season as of end of September, and 8% of the supply as of end of October.

Uttar Pradesh government is likely to keep the administered price of cane for 2017-18 (Oct-Sep) unchanged at 305 rupees per 100 kg. It is most likely that the state-advised price for sugarcane will not be raised for 2017-18. Reduction in price is anyway not possible as it would clash with farmers’ demand for higher prices. In 2016-17, Uttar Pradesh had raised the administered price of cane by 25 rupees per 100 kg to 305 rupees after keeping it unchanged for three years. The state government is likely to continue with its sugarcane pricing policy for at least two more years, a senior official from the state cane department had said earlier this month.

Prices of sugar rose in the key wholesale markets of Mumbai due to an increase in demand as Maharashtra markets opened after a three-day holiday. Prices of the sweetener, however, fell in the key wholesale markets of Delhi as demand was hit due to police blockades set up in Punjab and Haryana to quell unrest ahead of the announcement of the sentence against self-styled godman Gurmeet Ram Rahim.

Sugar prices extended their revival, returning above 14 cents a pound at one point, after Brazil unveiled a 20% tax on Brazil ethanol imports, in the latest of a series of moves by the top producing country of the sweetener deemed potentially positive for values. Raw sugar futures for October stood 2.1% higher at 13.95 cents pound in midday deals in New York, taking close to 8% the contract revival from a mid-month low. Earlier the contract touched 14.06 cents a pound.

US ethanol market participants and trade groups decried the Brazilian government decision to levy a 20% tariff on ethanol imports above 600 million liters. Brazil, the second largest ethanol producer in the world, began importing large volumes of ethanol in 2016 as high sugar prices made the sweetener more attractive to sugarcane mills than ethanol. Through June, the US exported over 1.045 billion liters of ethanol to Brazil. That could mean that any further exports to Brazil would be subject to the 20% tariff. But it does not appear that exports from earlier this year above the 600-million-liter level would be affected by the tariff.

Sugar market witnessed higher volume almost double at mill level at steady prices as stockiest gave fresh orders to meet higher physical demand for 11 days long Ganeshotsav starting. At Vashi prices remained unchanged despite higher arrivals and local dispatches.

Some 55,000 metric tons (MT) of sugar exported to the United States before October 31 to fill the additional sugar quota granted by Washington to the Philippines. Washington granted the Philippines an additional sugar quota of 63,830 MT for fiscal year 2017.

Raw sugar futures on ICE rallied to a 2-1/2-week high after Brazil confirmed it tax ethanol imports, which could possibly encourage mills to produce less sugar. October raw sugar settled up 0.35 cent, or 2.56 percent, at 14.02 cents per lb, after hitting 14.06 cents, its highest since Aug. 8. The tax raise the price of ethanol against sugar, which could encourage Brazilian mills to switch more production toward the biofuel instead of the sweetener.

Prices of sugar were up in the key wholesale markets across the country due to expectations of a rise in demand in the run up to the festival season starting next month. In Maharashtra, demand picked up also because markets closed for three days for Ganesh Chaturthi, starting from Friday. Mills in north India are increasing prices steadily as they expect demand to improve significantly before Durga Puja, Navratri and Dussehra.

Hyderabad: Commissioner for Civil Supplies C.V. Anand warned sugar traders against hiking the price by creating scarcity by stock holding of sugar illegally and practicing of speculative ctivities. Licensed Dealer / Trader should not sell sugar more than the price decided by Central government or state government. Raids should be conducted to check if any trader is doing business without license. A person engaged in the business of purchase sale and storage for sale of sugar and quantities of five quintals is considered as sugar dealer. Wholesale should get license from concerned district Civil Supplies officer, Tahasildar, if he fail to have license action will be taken under Civil Supplies Act.

The government has no plans to allow duty-free import of sugar as of now, Food Secretary Preeti Sudan said. Sugar production in the country fell to a seven-year low of 20.4 million tonne in 2016-17 (Oct-Sep). In April, the government had allowed duty-free import of 500,000 tonne of raw sugar until Jun 30 to shore up domestic supplies and keep prices in check. Earlier this month, Food Minister Ram Vilas Paswan had said that domestic sugar supply remains comfortable.

Prices of sugar fell in the key wholesale markets of Mumbai due to sluggish demand from bulk buyers. In Delhi, however, prices of sugar rose as demand improved amid low supplies. Traders expect demand to increase ahead of the upcoming festival season and are not lowering prices.