Sugar prices to trade sideways to down: Angel Commodities

Angel Commodities’ report on Sugar

Sugar Futures are unchanged on Monday on expectations of higher demand for sugar in coming weeks. Stockists and industrial buyers are active in buying sugar from the mills which may keep the sugar prices firm in next three months. Recently government hiked Sugar import duty to 50 per cent to support domestic prices.  India’s sugar production is set to rebound from a seven – year low as above – normal monsoon rain in the world’s largest  consumer helps the cane crop that will be crushed from Oct. 1. ICE Raw sugar futures ended unchanged at 14.4 cent s per lb. A frost that hit sugarcane fields in the south of the Brazilian state of Mato Grosso do Sul last week may cause limited damage to the crop. Last week it hit a seven – week high on support from tax changes in top producer Brazil that could make it more attractive to use sugar cane to produce ethanol. .  Reports that Brazil may raise its federal fuel taxes will likely widen the difference between gasoline and ethanol prices.

Outlook

Sugar futures may trade sideways to down on sufficient supplies in the domestic market Production is expected to be higher by 25% in 2017/18. Increase in FRP is encouraging farmers to take sugarcane crop while good sowing progress in the country will keep pressure on the sugar prices.

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