Sugar

Prices of sugar in the key wholesale markets of Delhi were up due to improved demand as consumption has increased amid wedding season. In Delhi, the sweetener was sold up 5 rupees per 100 kg from previous close. In Mumbai, prices of sugar were unchanged amid thin trade. On the NCDEX, the most-active May contract was up 1.8%.

India, the world biggest sugar consumer, has no plans to allow extra imports of the sweetener as stocks held in mills will suffice, Food Minister Ram Vilas Paswan said on Thursday. Last month, the government allowed imports of half a million tonnes of duty-free raw sugar, as a drought cut output below consumption for the first time in seven years. Traders were speculating that the government could soon be forced to allow imports of an extra 500,000 to 1 million tonnes to meet local demand, estimated at 24-25 million tonnes a year. Local sugar prices are steady around 38,000 rupees ($590.38) a tonne despite an uptick in demand during the summer months when sales of ice cream and cold drinks soar, potentially boosting demand for sugar.

The issue about the sugar sector currently buzzing in the market is that there is no congruency between the sugar cane and sugar prices in the state of Uttar Pradesh. Market analysts and top honchos of sugar companies believe that the UP government is likely to fix the issue of sugarcane prices soon. Upcoming Sugar year starting on October 1 is likely to see the well balance of production and consumption of sugar. In current trading session, the sugar stocks are trading mostly higher. Dwarikesh sugar is trading higher by 1.05%. Dhampur Sugar stock is trading higher by 0.13%. Uttam Sugar is trading higher by 0.08%. Balrampur Chini stock is trading higher by 1.2%.

Raw sugar futures on ICE were slightly lower on Thursday in a modest retreat after rising for three straight sessions as the market awaited the release of Brazilian harvest data. July raw sugar fell 0.08 cent, or 0.5 percent, to 15.76 cents per lb. (1LB = 0.4535924 KG). The front month contract had risen by 2.6 percent on Wednesday. harvest data for centre-south Brazil was due to be issued by growers’ association UNICA on Thursday covering the second half of April. crush was expected to have been 26 million tonnes, down 28 percent, year-on-year.

Demand from Stuckists pushed sugar prices up in the wholesale market of Muzaffarnagar and Delhi. Medium-grade sugar was sold up 10-20 rupees in Muzaffarnagar and in Mumbai. Demand of the sugar from other states such as Rajasthan and Gujarat was offset by forecast of normal monsoon in 2017. On the National Commodity and Derivatives Exchange, the May sugar futures were down as investors liquidated their positions ahead of staggered delivery from previous close. May sugar contract was down 0.4% and the July futures were up 0.1%.

U.S. fiscal year 2016/17 beet sugar production is decreased 64,000 short tons, raw value (STRV) based on lower expected sucrose recovery. Cane sugar production in Texas is reduced by 2,795 STRV based on final processor reporting. TRQ imports entering under Free Trade Agreements are increased by 2,555 STRV. Deliveries for human consumption are increased by 100,000 STRV based on pace to date. Ending stocks for 2016/17 are estimated at 1.477 million STRV. Sugar production for 2017/18 is projected at 8.700 million STRV, the sum of beet sugar production of 4.950 million and cane sugar production of 3.750 million. Imports for 2017/18 are projected at 3.858 million STRV and are comprised of TRQ imports of 1.373 million; re-export imports of 175,000; imports from Mexico of 2.301 million; and high-tier tariff imports of 10,000. Projected 2017/18 TRQ imports of specialty sugar include only the WTO minimum quantity because any additional quantities have not been announced by the Secretary of Agriculture. Exports for 2017/18 are projected at 25,000 STRV. Deliveries for human consumption are expected to increase 1.0 percent year-over-year to 12.322 million STRV. Ending stocks for 2017/18 are projected residually at 1.534 million, implying an ending stocks-to-use ratio of 12.3 percent. For 2016/17, Mexico sugar exports to non-U.S. destinations are reduced by 58,919 metric tons (MT) to 110,000 based on pace to date. Product re-export deliveries under the IMMEX program are increased 60,000 MT to 390,000 to match the total now estimated by Mexico authorities for 2015/16. Ending stocks are estimated residually at 1.342 million MT, an increase of 48,919 over last month. For 2017/18, Mexico sugar production is projected at 6.225 million MT based on a sugarcane crop of 55.000 million and a recovery of about 11.3 percent. Combined per capita consumption of sugar and HFCS for 2017/18 is projected the same as for 2016/17. With flat HFCS consumption, sugar deliveries for human consumption for 2017/18 are projected at 4.528 million. Exports to the United States are based on U.S. Needs as defined in the Suspension Agreements but, assuming additionally, that U.S. specialty sugar imports will be set at the same level as initially established for 2016/17.

In terms of containers, sugar export from Brazil rose 14% on year to 591,121 tonne in Jan-Mar. Brazil is the largest producer and exporter of the commodity. The main destination of exports was Myanmar at 125,560 tonne, followed by South Africa at 55,331 tonne. Most exports of sugar in containers is crystal sugar, also known as whites. Brazil exports mainly raw sugar in bulk vessels. The most active July sugar on the ICE was up 1.2% from the previous close.

Sugar output in the state during 2017-18 (Oct-Sep) is seen falling below 1 millionn tonne as Tamil Nadu faces the worst drought in 140 years. Last year, mills in the state had produced 1.37 millionn tonne sugar. Sugar Production in 2017-18 is likely to be even lower than the current season because of successive years of meagre rainfall in the state, a drop in cane acreage, and lower sugar recovery. Tamil Nadu received 62% below-normal rainfall during the key northeast monsoon season in Oct-Dec. Production suffer due to drought It be drastically reduced and if the current trend continues, sugar output not even touch 1 millionn tonne next year. Tamil Nadu has been producing below its capacity for the last two-three years because of water crisis and low recovery from cane. Sugarcane sowing had fallen 8.8% on year to 268,000 hactare this season due to poor monsoon rains.

Subdued demand at higher price levels weighed on sugar in the key wholesale markets of north India. Medium-grade sugar was sold in Delhi and Muzaffarnagar down 5 rupees from previous close. Prices of the sweetener, however, were unchanged in the key wholesale markets of Mumbai, and Kolhapur amid thin trade. Mills are maintaining prices despite low demand as they maintain supplies for the next five months and the production this year is seen low. Traders across north India are bearish on sugar prices in the near term. Prices are expected to decline further in north India due to a rise in output in Uttar Pradesh.

The government should impose additional tax on pre-packed foods which have high salt or fat content and on sugar-sweetened beverages to cut down on their consumption. Imposing additional tax on the purchase of commodities such as pre-packaged foods with high salt and fat content, sugar sweetened beverages, can be a pragmatic approach to reduce their intake. Companies should disclose the total calories content, carbohydrate, sugar, fat, protein, sodium and trans-fat added in their product, clearly on the labels.

Futures contracts of raw sugar on the ICE recovered today after as prices of the sweetener were nearing ethanol parity. A fall in sugar prices incentivises millers to shift to ethanol production instead of sugar. Millers in key cane-producing countries like Brazil have a choice between producing sugar or ethanol. Most-active July raw sugar contract had fallen to a 12-month low of 15.24 cents per pound. July contract was up 0.7% at 15.49 cents per pound.

Prices of sugar fell in the key wholesale markets of Delhi due to sluggish demand at higher prices. Sugar prices fell by 5 rupees per 100 kg in Delhi. Prices of the sweetener were unchanged in the key wholesale markets of Muzaffarnagar, Mumbai, and Kolhapur because of subdued trade. Mill owners did not lower prices of sugar despite a fall in demand. Traders across the country are bearish on the sugar prices in the near term. Prices are expected to be lower in north India due to higher sugar output in Uttar Pradesh. Mills across Uttar Pradesh produced 8.73 mln tn sugar during Oct 1-May 8, up 28.4% on year. The state had produced 6.80 mln tn sugar during the corresponding period a year ago. Average sugar recovery in Uttar Pradesh as of now is 10.61%, slightly higher than 10.60% a year ago.

Futures contracts of sugar on the NCDEX rose as traders bought the commodity at low prices. The most active June sugar contract was up 0.5% from the previous close. sugar prices were largely bearish due to a fall in prices in global markets and on expectation of a rise in imports. Contracts on the NCDEX, however, are seen bearish in the days ahead, tracking weakness in global prices.

Prices of sugar were unchanged in the key wholesale markets of Mumbai and Muzaffarnagar because of subdued trade. Mill owners did not lower prices of sugar despite a fall in demand. Earlier this month, prices had risen as retail and bulk demand had improved. Prices at both the markets were unchanged from previous close. On the NCDEX, the most-active May contract traded up 0.2% from the previous close.

Mills across Uttar Pradesh produced 8.73 million tonne sugar during Oct 1-May 8, up 28.4% on year. The state had produced 6.80 mln tn sugar during the corresponding period a year ago. Mills in the state have crushed 82.31 mln tn cane so far, compared with 64.14 mln tn in the year-ago period. Average sugar recovery in Uttar Pradesh as of now is 10.61%, slightly higher than 10.60% a year ago.

Prices of sugar in the key wholesale markets of Delhi and Muzaffarnagar rose on improved demand for the sweetener, with Stuckists replenishing their inventories at the start of the month. Retail demand from households usually increases during the first week, thereby supporting prices. Delhi and Mumbai, sugar was sold up 10 rupees from previous close. On the NCDEX, the most active May contract of sugar traded up 0.1% from the previous close.