Sugar Futures fell on Friday on reports of higher sugar production figures by ISMA for the current sugar season. The lower production of sugar in Maharashtra has been compensated by two fold increase in Uttar Pradesh production. On weekly basis the prices have been increased due to reports of lower production in Maharashtra. The most-active March sugar contract closed 1.48% higher last week to settle at 3,630 per quintal.
ICE raw sugar closed lower in Friday as chart-based signals remained weak and expectations of a surplus weighed on prices. The prices have fallen this week due to a weakening of the Brazilian real, which could stimulate sugar exports. Moreover, sugar prices also down due to signs of a lower 2016/17 world sugar market deficit and expectations of a surplus in the next season.
We expect sugar prices to trade sideways on reports of higher production of sugar in the country till December 15. There is however an anticipation of cane scarcity in Maharashtra but production in UP is going to be good this season. There are also reports of easing supplies in the coming months as crushing season is going on in all the sugarcane growing states.