Sugar Futures witnessed mixed sentiment throughout the day and settled 0.50% higher on Monday. Reports that government might discuss on decontrol of sugar and levy sugar also supported prices in the last few hours of the trading session yesterday. Discussion on the same is scheduled on January 16, 2012. However, sufficient supplies at the domestic market led prices to remain weak in the spot.
Sugar recovery in Maharashtra during October 2011-December 2011 stood at 10.35% as compared to 9.80% in the same period previous year.
However, Sugar recovery in U.P. is lesser at 8.47% till 3rd January 2012 as compared to 8.73% in the same period previous year.
The government has released lower monthly quota for the month of January at 17.16 lakh tonnes which includes 2.16 lakh tonnes of levy quota and 15 lakh tonnes of non levy quota. The quota for January is much lower compared to January 2011 monthly quota of 19.18 lakh tonnes and last month’s quota of 19.07 lakh tonnes.
According to the Food Minister, Ministry is planning to discuss with States, the Finance and Agriculture Ministries on removing some of the controls such as doing away with the mandatory obligation to offer sugar for the public distribution system (PDS) in the New Year(Source: Hindu Business Line.
Liffe white sugar and ICE Raw sugar witnessed mixed trades on account of lacklustre demand and settled 0.17% and 0.21% higher respectively on Monday.
Domestic Sugar updates
Sugar output in Maharashtra rose 18.8% between Oct 01 and Dec 31, 2011 to 27.5 lakh tonnes. The output was earlier down by 6%. Output increased on account of higher recovery rate and number of mills that are operational this year. According to ISMA, India is likely to have crushed 14.4 mln tn cane during Oct 1-Nov 23 and produced 7.58 mln tn sugar vs 6.46 mil tn during the current crushing season.
Indian Sugarcane production is estimated higher by 0.9% at 342 mn tn for 2011-12 season starting October 1, 2011. ISMA has projected sugar production at 26 million tonnes for 2011-12.
With the opening stocks of 6 mn tn, domestic Sugar supplies are estimated at 32 mn tn against the domestic consumption of around 23 mn tn. Thus there is a wide scope for exports from India.
Global Sugar Updates
Thailand has crushed 9.4 mn tn cane this season against 3.3 mn tn a year ago. Thailand sugar output could reach to 9.9 million tonnes in 2011-12 compared to 9.64 million tonnes in 2010-11.
According to UNICA, Sugar output in Brazil's center-south in the first half of November fell 13.8 percent from a year ago, as more mills ended crushing the 2011/12 cane crop. Sugar production in the period totaled 1.26 million tonnes, compared with 1.46 million tonnes a year earlier.
Swiss sugar consultancy Kingsman lowered its global 2011-12 sugar surplus estimate by 940,000 tn to 8.22 mln tn.
Courtesy: Angel Commodities
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