Indian sugar futures rose on Monday as traders squared-off short positions in the December contract and tones, supported by the prospect of strong exports this month. But huge deliveries are likely to weigh on prices in the near-month contract, an analyst and a sugar broker said.
By 4:05 pm (1035 GMT), the December contract on the National Commodity and Derivatives Exchange was up 0.31 percent at 1,285 rupees ($32.5) per 100 kg. The January contract had edged up 0.15 percent to 1,307 rupees.
"Traders with no intention of making deliveries are squaring-off their positions in the near-month and partially taking fresh positions in the far-month," said Amol Tilak, an analyst at Kotak Commodity Services Ltd.
Deliveries in the near-month contract, which expires on December 20, may surge to 15,000 tonnes, said a sugar broker in the western state of Maharashtra, India's largest sugar producing state, a big jump from 5,360 tonnes in November. According to an estimate by traders, India will export about 150,000 tonnes of sugar in the second half of December. Loading for exports has begun at major western ports.
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