According to Angel Commodities, We expect sugar prices to trade sideways on good physical supplies from mills are continuing in the physical market due to imposed stock limit on mills.
Sugar Futures closed lower on Tuesday on expectation of starting of early crushing in Maharashtra coupled with good supplies of sugar in domestic market. The most-active December sugar contract closed 0.51% down to settle at 3,532 per quintal.
ICE raw sugar futures closed lower on Tuesday on reports that top cane sugar producer Brazil is expected to produce around 2 mt more sugar and import a high ethanol volume next year as mills tend to allocate more cane to produce sugar.
Sugar production will increase as it is seen between 36.1 mt and 36.4 mt versus 34.1 mt this season, as mills expand their capacity to produce the sweetener by 2 million tonnes.
We expect sugar prices to trade sideways on good physical supplies from mills are continuing in the physical market due to imposed stock limit on mills. Government is thinking of extending stock limit for the next sugar season on traders and stockists. The start of new season crushing may also pressurize prices.
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