Buy Sugar on dips: Sharekhan

Sharekhan's trading ideas on agricultural commodities

Sugar & Gur

Sugar witnessed a firm tone in futures and cash markets.

Julio Borges, director at JOB Economia & Planejamento, states that Brazilian sugar output in the year that started May 1 will reach to 35.2MMT compared with 34.2MMT in last year. The cane crush is seen up to 586.2MMT as compared with 533MMT in previous year. The mills will use 46 percent of cane output for sugar and 54 percent for ethanol. The Raw-sugar prices seen on lower side on global surplus.

Jenkins Sugar Group Inc. estimates USA sugar output at 8.8 million short tonne in the year starting Oct. 1 and imports of 3.365 million short tonne also expected.

Sugar line-up at Brazilian ports rises by 32 percent and 1.18MMT of sugar was waiting to be loaded onto ships at Recife, Maceio, Paranagua and Santos compared with about 896,576 tonne a week earlier.

Outlook: Prices are likely to trade firm in near short term.

Pulses

Chana maintained a flat tone at futures on comfortable stock position.

Moreover, market participants informed that chana from neighbouring countries like Pakistan are traded at Rs3,300 per quintal in Delhi market also weigh on prices.

Trade sources revealed that chana may dip to Rs3,200 per quintal at Delhi markets in this month while Ramzan in July month may support the prices in June. Outlook: Chana prices would dwindle further to Rs3,300 per quintal in the coming weeks but on short term it would surge on festival demand.

Trade idea: Buy sugar on dips and sell chana on rise

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