Indian sugar futures edged higher on Friday on a delay in cane crushing in key producing states, though weak demand in local spot markets and higher supplies restricted the gains. By 0919 GMT, the key December contract on India's National Commodity and Derivatives Exchange was up 0.21 percent at 3,315 rupees ($60.82)per 100 kg.
Usually most factories in Maharashtra, the top sugar producer in the country, start cane crushing by the first week of November, but it has been delayed this year as farmers and mills have not yet agreed on cane prices. In the northern state of Uttar Pradesh, both farmers and mills are waiting for the state government to announce the state advised price for cane.
"Crushing is delayed, but demand is also weak. Wholesalers have already made purchases for Diwali. They are not active in the market," said Ashok Jain, president of the Bombay Sugar Merchants Association. Indians will celebrate Diwali this month, and demand for sugar goes up during this season as the consumption of sweets rises. Sugar fell by 10 rupees to 3,456 rupees per 100 kg at the Kolhapur spot market in top producing Maharashtra state.