Sugar Stocks Turned Sweeter As Sugar Prices Surged
- Rate this article (Average Rating 0.0 Based on 0 ratings)
Sugar price has hit the highest level in seven years following sudden pick up in lifting from bulk consumers and lower production estimates this season. Gradually approaching towards Rs 40 per kg in the wholesale Vashi market, the benchmark Sugar M 30 variety closed at Rs 39.35 per kg on Tuesday. The sweetener has jumped by over 3 per cent in the last 10-days. Ex-mill sugar prices, which plunged by Rs 2 to 3 per kilo since the second week of November 2016 after demonetization, have started improving and are now at the levels seen a couple of years ago.
Why the rise?
Post demonetization, lifting of sugar from bulk consumers, like ice cream and soft drink makers, slowed down resulting in a sharp fall in sugar prices. However recently, trade sources say there has been a sudden surge in off-take by bulk consumers that has pushed the prices up.
Abinash Verma, Director General, Indian Sugar Mills Association (ISMA)has said in a recent report that with higher cane price announced by states of Uttar Pradesh, Punjab and Haryana, low sugar recovery being attained in the Tamil Nadu, Andhra Pradesh and other states, and lower capacity utilization in drought-affected areas of Maharashtra, Karnataka and Telangana, the all-India average cost of production of sugar during the current 2016-17 Sugar Season, will nearly be higher at around Rs 35 to 36 per kilo which is Rs 2 more than the previous year’s cost of production.
With lower off-take and sugar consumption in 2016-17, sugar stocks at the end of the current season may be higher than what was projected earlier, by 0.5-1.0 million tons. ISMA will carry out its second advance valuation for sugar production in 2016-17, later this month, based on satellite images.
Mr. Verma also said that Sugar mills should be permitted to recover at least their costs during the current season, or else, they would not be in the situation to make payments to farmers on time and would also not be in a position to repay the loans taken from Government of India including those under SEFASU and soft loans, which are due to be repaid this year.+++++
Click here to read the full report
Dynamic Equities Pvt. Ltd. is a a SEBI Registered Investment Advisor and Stock Broker, a leading financial services provider, and one of the major players in the Equity markets in India. With an experience of over 15+ years in Stock Markets and Equity Research, they provide daily updated Support & Resistance of 4200 instruments across 93 exchanges and 56 countries globally. They have an in-house team of over 25 analysts. Under the guidance and mentorship of Mr. Shailesh Saraf, MD of Dynamic Equities Pvt. Ltd., these analysts are dedicately involved in guiding their clients and users of the website www.dynamiclevels.com for trading in the market. Mr. Shailesh Saraf has an experience of over 24 years in the financial market, especially in capital & derivatives market operations, trading, research and management related areas. Dynamic Levels is a website owned by Dynamic Equities Pvt. Ltd. The website can be reached at www.dynamiclevels.com.
For more information please write in to email@example.com
Disclaimer: The author has taken due care and caution to compile and analyse the data. The opinions expressed above are only the views of the author, and not a recommendation to buy or sell. Neither the author nor IndiaNotes.com accept any liability whatsoever arising from the use of any of the above contents.
- Sugar Stocks Continue To Climb Up the Green Ladder
- Sugar Stocks gain on the Rising Sugar Prices
- Sugar Stocks Gain On Debt Restructuring
- Sweetness Spreads in the Sugar Sector
- Top Performing Multibaggers from Top Sectors Last Week
Have a question?
CEO - Pragmatic Wealth Management
Also On IndiaNotes.Com
- Here's How Digitalization Helps You Buy a House Out of Your State
- 3 Steps to Check Your Credit Score Online before Applying for a Home Loan
- Bata India Q3FY17: Is it recommended for medium and long term investment?
- Dynamic Levels recommend a chemical scrip for target of Rs 2500