Sugar futures surge by 1% on strong demand

Sugar prices climbed 1.07 percent to Rs 3,582 per quintal in futures trading today as traders enlarged positions following upsurge in demand in the spot market.

Besides, expectations of fall in sugar production also supported the upside.

Meanwhile, country's sugar production is estimated to decline by over 9 percent to 256 lakh tonnes in the current marketing year ending September on account of lower sugarcane output.

Sugar production in India, the world's second largest producer after Brazil, stood at 283 lakh tonnes in the 2014-15 marketing year (October-September).

At the National Commodity and Derivatives Exchange, sugar for delivery in May month climbed by Rs 38, or 1.07 percent to Rs 3,582 per quintal with an open interest of 1,23,090 lots.

Similarly, the sweetener for delivery in July contracts moved up by Rs 37 or 1.01 percent to Rs 3,718 per quintal in 24,760 lots.

Analysts said participants increasing their bets due to rising demand from retailers as well as bulk consumers in the spot market, mainly pushed up sugar prices at futures trade.