| Date: |
11-08-2015 |
| Subject: |
Sugar, wheat likely to cost more soon |
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Mumbai: After vegetables and pulses, it's the turn of sugar and to a lesser extent wheat to burn a hole in the householder's pocket, recent trends in wholesale prices on the commodity futures market show.
Sugar for October delivery on farm bourse NCDEX has risen 12.6% from a contract low on July 23 to a high of Rs 24.2 a kilo on Monday. Wheat for September delivery, which like sugar has remained subdued for years, rose almost 4% from a contract low ofRs 14.9 a kilo on Friday to a high of Rs 15.5 on the same day. Sugar surged on buzz of the government allowing manufacturers to export processed sugar, which is currently banned, according to Anuj Gupta, derivatives analyst, Angel Commodities. The imposition of a 10% import duty on wheat last Friday by the government after 5 lakh tonnes of high quality wheat were imported into the country caused the commodity to shoot up that day, he claimed.
The rise in sugar and wheat futures prices has been accompanied by a build-up in traders' outstanding positions, or open interest (OI), in the two commodities. This means traders expect prices to rise further, which is why they are initiating bullish bets, said Harish Galipelli, commodity head, Inditrade.OI in sugar has risen from 41,680 lots on July 23 to 48,970 lots on Monday at the time of writing. Outstanding positions in wheat soared from 5,430 lots on Thursday to 9,470 lots on Friday when the price jumped by 4%.
Abinash Verma, director general of sugar lobby ISMA, said the recent jump in market sentiment was probably based on "expectations" of "some kind of package" for the sugar industry following a high-level meeting on August 1.
Source : economictimes.indiatimes.com
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