Indian sugar futures rose on Friday after the government said it would take a number of measures to help mills hit by falling prices, while soyaoil futures fell slightly on worries of a cut in import duty.
June sugar futures on the National Commodity and Derivatives Exchange (NCDEX) were up 7 rupees at 1,295 per 100 kg, while July futures rose by 5 to 1,332.
"Sugar has bounced back as the statement of the agriculture minister came as a boon for the sector, which has been struggling due to mounting stocks," an analyst with a Mumbai brokerage said.
Farm Minister Shared Pawar said on Thursday that sugar output had already reached 27 million tonnes this year and an additional 800,000 to 1 million tonnes would be produced by the end of the crop year in September 2007.
Sugar output in India, the world's second-largest producer, last year was 19.3 million tonnes. With a bumper production this year and estimates of a similar output next year, Pawar said the government was thinking of setting aside a fixed quantity of sugar exclusively for exports, with the aim of emerging as a long-term, reliable supplier.
The market also expects the government will raise the sugar buffer stock limit to 5 million tonnes from 2 million tonnes to help deal with the surplus, a Mumbai-based trader said.
Expectations the government will cut import duty on edible oils to keep a lid on prices saw soyaoil futures extend their fall of recent days.
June soyaoil futures on the NCDEX were down marginally 0.15 rupees to 486.50 rupees per 10 kg, while July soyaoil futures were down 0.40 rupees at 493.85 per 10 kg.
"Soyaoil is down as fears of an edible oil import duty cut still looms large," the analyst said.
Comments
Comments are closed.