Weekly Review-Sugar

22-Feb-2025 08:32 PM

Sugar prices soften due to selling by mills


Weekly Sugar Review - February 15-22, 2025


Market Overview
Sugar prices softened in the week of February 15-22, driven by increased selling by millers to clear the monthly free sale quota. The mill delivery price dropped by up to Rs 60 per quintal across various regions in India.

Mill Delivery Price Adjustments

  • Western Uttar Pradesh: Rs 58 decrease per quintal
  • Punjab: Rs 31 decrease per quintal
  • Madhya Pradesh: Rs 30 decrease per quintal
  • Bihar: Rs 40 decrease per quintal
  • Gujarat: Rs 10-20 decline

Spot Price Movements
In contrast to the mill delivery price, the spot market saw either stable or slightly stronger prices:

  • Delhi Wholesale Price: Increased by Rs 30, now at Rs 4380-4480 per quintal
  • Indore: Increased by Rs 45, now at Rs 4125-4225 per quintal
  • Kolkata: Increased by Rs 25-40 per quintal
  • Mumbai (Vashi): Rs 3980-4080 per quintal, unchanged from last week
  • Raipur: Stable at Rs 4100-4200 per quintal
  • Nakaport Delivery: Stable at Rs 3830-4030 per quintal

Demand Trends
The ongoing heatwave is driving a rise in domestic demand, supporting higher price levels. Additionally, the government's approval of 10 lakh tonnes of sugar for export is having a positive psychological effect on the domestic market.

Production Outlook
Domestic sugar production is expected to drop by 45-50 lakh tonnes in the 2024-25 marketing season. By the end of the season, the sugar stock with the industry is expected to fall below 50 lakh tonnes, enough to meet domestic demand for only two months. This shortfall could potentially lead to supply constraints in the coming months.

Consumption and Seasonal Factors
The increase in temperature is likely to boost both demand and consumption of sugar in the upcoming months. With the jaggery production season coming to an end, several sugar mills are already shutting down due to a shortage of sugarcane, particularly in Maharashtra and Karnataka. This could further tighten the supply in the domestic market.

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