November 8, 2012 / 10:17 AM / 5 years ago

Indian sugar flat as crushing delay negates weak demand

MUMBAI, Nov 8 (Reuters) - Indian sugar futures were flat for the second straight day on Thursday as lower than expected festive season demand outweighed a delay in cane crushing in top two sugar producing states.

* By 0949 GMT, the key November contract on India’s National Commodity and Derivatives Exchange was down 0.06 percent at 3,364 Indian rupees ($61.72) per 100 kg.

* “Farmers and millers are firm over their stand. Some mills are ready to raise cane price, but it is not possible for them to accept demand of 3,000 rupees per tonne,” said an official at Maharashtra State Cooperative Sugar Factories Federation.

“Discussions are going on. Possibly we will find a solution in a week,” the official said.

* Usually most factories in Maharashtra, the top sugar producer in the country, start cane crushing by the first week of November, but it has been delayed this year as farmers and mills have not yet agreed on cane prices.

* In the northern state of Uttar Pradesh, both the farmers and mills are waiting for the state government to announce state advised price for cane.

* Sugar rose by 9 rupees to 3,468 rupees per 100 kg at the Kolhapur spot market in the top producing Maharashtra state.

* The government has asked millers to sell 4 million tonnes of sugar in the open market during October and November, higher than the average monthly allocation of around 1.7 million tonnes.

* India’s sugar output in the 2012/13 crop year, which started on Oct. 1, is likely to fall to 23.5-24 million tonnes from 26 million tonnes a year earlier. ($1 = 54.5 Indian rupees) (Reporting by Rajendra Jadhav; Editing by G.Ram Mohan)

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