Glut to dent sugar

COMMODITY SPIKES

The extra release of 1,50,000 tonnes of sugar by the government into the market brought a sharp decline in an otherwise firm sugar futures, with rates declining by Rs 9 a quintal in a single closing trading session on Saturday.

Market sources said that the government may also go for the conversion of unused levy sugar to free sale sugar in the coming days. They estimated that the measure could add more than 1 lakh tonnes of sugar into a market, reeling under a glut this year.

Commodity experts said that spot market, which has fallen by Rs 15-20 a quintal, may not fall as drastically as futures would. Production this year is slated to reach 30 million tonnes, 36 per cent more than previous year's production.

On the Ncdex, the near month future of Sugar M closed at Rs 1,273 a quintal on Saturday against the previous close of Rs 1,282 a quintal.