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India sugar drops on weak demand from bulk buyers
May 30, 2013 / 8:38 AM / 4 years ago

India sugar drops on weak demand from bulk buyers

MUMBAI, May 30 (Reuters) - Indian sugar futures eased on Thursday on sluggish demand from bulk consumers amid mounting supplies, though a likely drop in next year’s output due to a drought limited the downside.

* The key June contract on the National Commodity and Derivatives Exchange was down 0.2 percent at 3,013 rupees ($53.63) per 100 kg at 0807 GMT.

* “Weak demand weighed on sentiments. From the current level prices should rebound. Mills are resisting pressure of selling sugar at lower level,” said Badruddin Khan, associate vice-president of research at Indiabulls Commodities.

* Demand for sugar from ice cream and beverage makers typically rises during the summer, although this year it was lower than expected, dealers said.

* Spot sugar fell 22 rupees to 3,050 rupees per 100 kg at the Kolhapur market in the top-producing Maharashtra state.

* In the next few days the market will track the progress of monsoon, Khan said. Already a large area under cultivation has been hit by drought. Timely rainfall is required to limit the damage, he said.

* Sugar cane is a perennial, water-intensive crop and is usually harvested 10 to 16 months after planting. Cane for the crushing season starting Oct. 1 has been planted, but half the total acreage is short of water.

* India is likely to produce 24.6 million tonnes of sugar in 2012-13, an industry body has said, against an annual demand of about 23 million tonnes.

* New York raw sugar closed down 0.3 percent at 16.67 cents a lb on Wednesday, not far from a low of 16.56 cents hit on May 23, the weakest level for the front month since July 2010. ($1 = 56.1850 Indian rupees) (Reporting by Rajendra Jadhav; Editing by Gopakumar Warrier)

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