Indian soyaoil futures rose on Wednesday defying global trends, although traders expected a correction soon, while sugar was dragged down by improved supplies and higher output forecasts.
Wheat was down as traders expected recent rains to boost output of the grain in the 2007 season. The February soyaoil contract on the Multi Commodity Exchange (MCX) had gained 1.60 rupees to 450.85 rupees per 10 kg, while the March contract was up 2 rupees at 459.50.
"The rise in soyaoil is just a blip and the contracts may go down soon, tracking global markets where sentiments are bearish on weak demand," a Mumbai-based trader said. International prices have also eased as supplies improved following recent rains in Malaysia and Indonesia, which had disrupted arrivals.
Sugar was down as supplies in the current cane crushing season peaked and output in the crop year to September 2007 is slated to hit a record 23-24 million tonnes, the trader said.
India, the world's second-largest producer and biggest consumer of the sweetner, produced 19.3 million tonnes in the last sugarcane season that ended in September 2006. The February sugar futures on the National Commodity and Derivatives Exchange slipped 3 rupees to 1,583 rupees per 100 kg.
March futures fell by an equal margin to 1,576 rupees. The trader said wheat edged down as the market believed recent rains would help raise output in 2007. Farm ministry officials believe India will produce 74 million tonnes in 2007 against 69.4 million tonnes the year before. February wheat futures on the NCDEX fell 2.20 rupees to 1,009 per 100 kg, while the March contract was down 2.80 rupees at 946.40.
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