| Date: |
09-05-2015 |
| Subject: |
Sugar futures may trade sideways to negative: Angel |
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Sugar future closed 1.85 per cent down and touched months low due to ample supply in domestic market against steady demand. The government increased import duty to 40% from current 25% and withdraw duty free import of raw sugar to at curb imports. It has also removed a 12.36% excise duty levied on ethanol supplied for blending with petrol.
As per the latest estimates released by the Indian Sugar Mills Association (ISMA), India produced 273.7 lakh tonnes (lt) of sugar till April end, about 14.27 per cent more than at the same time last season. Earlier, the Cabinet Committee on Economic Affairs (CCEA) has approved incentive scheme for marketing and promotion services of raw sugar production during 2014-15 (October-September) for a quantity of 1.4 million tonnes.
Global Sugar Updates
According to International Sugar Organization (ISO) latest data release, the world production to reach a record 172.1 million tonnes in 2014/15.
As per US farm official, Brazil's sugar exports to fall in 2015-16 for a third successive season as mills divert more crop to making ethanol. Brazil's cane crop for the season pegged at 648m tonnes, a rise of 19.4m tonnes year on year. China import down 24 % from a year ago to nearly 1.24 lakh tonnes of sugar in February but imports for the first two months of 2015 came to 5.09 lakh tonnes, up 12.6%, according to customs data. China's sugar production predicted to decline 12% against the backdrop of a 4% rise in demand.
Outlook
Sugar futures may trade sideways to negative on supply glut in the domestic market but recent government policies on sugar exports may not have any impact on sugar prices as next year’s harvest expected to be good on increased sugarcane prices by government.
Source : moneycontrol.com
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