Jaggery prices rise Rs 30 a quintal on output drop

Jaggery prices in western Uttar Pradesh have seen a Rs 25-30 per quintal hike. This is primarily attributed to a harsh winter this time pulling production down by almost 40 per cent over the last winter. Jaggery production usually declines in the winter months, but this year's drop is exceptional.

With Makar Sankranti approaching, demand for jaggery is seeing an increase, boosting prices as a result.

Currently, karba variety of jaggery is being traded between Rs 525 and Rs 530 per kg, while gur laddu is being sold in the range of Rs 540-Rs 547 per 40 kg. Gur chaaku prices are ranging between Rs 535 and Rs 558 per 40 kg in Muzaffarnagar in western Uttar Pradesh.

Almost 75 per cent of the sugarcane crop is used for sugar production, while 10-12 per cent is utilised for producing jaggery. This winter, however, due to the price war among sugar mills sugarcane availablity for jaggery production is expected to be lesser. This is the main reason for the price rise.

"About 20,000 bags of 40 kg each (of jaggery) are arriving every day in western UP. This is normal. But the current price war among sugar mills for procuring the sugarcane crop could mean a decrease in sugarcane for jaggery production. In anticipation of this jaggery prices are going up," Arun Khandelwal, a trader in Muzaffarnagar, said.

Sugar prices in Mumbai have been steady for the last one week, trading between Rs 1,700 per quintal for the lowest quality and Rs 2,100 per quintal for the best quality.

There is good buying support in Mumbai as well due to rising seasonal demand, but that is being neutralised by oversupply, currently at 14-15 trucks of 10 tonne each, Deepak Shah, partner, Nagindas Harilal & Co, said.

Jaggery prices in Mumbai are expected to decline by Rs 100 per quintal once the market reopens after the five-day Makar Sankranti holidays on January 12. "Demand is expected to decline in Mumbai soon after Sankranti and from then seasonal demand is expected to crash," he said.

"There have been no supplies to Mumbai from other states. However, Maharashtra is competent to meet to the city's jaggery demand and, hence, arrivals from other states such as Madhya Pradesh are not really required," Shah said.