New Delhi: Due to the high free sale quota announced for December, millers are being forced to increase sugar sales despite weak demand. As a result, a sharp decline was recorded in mill delivery prices, spot market prices, and tender prices of sugar during the week of December 6-12. The fall in temperature and increased availability of jaggery and gur have weakened both industrial and domestic demand for sugar.

During the week under review, mill delivery prices of sugar witnessed a sharp decline of Rs. 20 per quintal in Eastern Uttar Pradesh, Rs. 75 in Western Uttar Pradesh, Rs. 170 in Punjab, Rs. 30 in Madhya Pradesh, and Rs. 60 per quintal in Bihar. Prices also fell by Rs. 40 per quintal in Gujarat. Buyers are reported to have ample stocks of sugar.

While the spot market price of sugar remained unchanged at Rs. 4100/4150 per quintal in Indore, it fell by Rs. 70 to Rs. 4390/4430 per quintal in Delhi and by Rs. 50 to Rs. 4050/4100 per quintal in Raipur. In Mumbai (Vashi), it also fell by Rs. 50 to Rs. 3800/3970 per quintal. The Naka port delivery price of sugar there also declined by Rs. 50 to Rs. 3780/3920 per quintal. However, in Kolkata, prices improved by Rs. 10-20 to Rs. 4250/4400 per quintal.

The tender price of sugar fell by up to Rs. 40 to Rs. 3625/3850 per quintal in Maharashtra and by up to Rs. 90 to Rs. 3620/3780 per quintal in Karnataka. This clearly indicates extremely weak demand from buyers for sugar.

Sugar production in the domestic market is increasing, but consumption is not keeping pace. Even the wedding and festive season is failing to boost demand and prices.

The market price is expected to remain stable within a certain range for the next few weeks, with only minor fluctuations. Some increase in demand is anticipated in South India due to the Pongal festival.