World sugar prices have slumped

World sugar prices have actually slumped from their peak levels and imports of raw sugar on a duty free basis will be considerably cheaper with a hardening rupee. In the whole of 2009-10 the rupee has gained against the U S dollar to the extent of 11.70 per cent.

This year's (October-September) domestic sugar output also is estimated at 18 million tonnes, an improvement of three million tonnes over the earlier estimate.

Along with refined sugar from imported raw sugar of four million tonnes, internal offtake of 22.5 million tonnes can be met without difficulty and opening stocks may be utilised only for 5-10 lakh tonnes.

On present indications, the prospects for the 2010-11 crushing season are encouraging and sugar output can be even 26 million tonnes. Abundant cane is available thanks to increased acreage spurred by the sharp rise in statutory minimum price. Ex-factory sugar prices have dropped to Rs. 2,900 a quintal from around Rs. 4,000 a few months ago.

source: hindu