SUGAR

FUNDAMENTALS

Sugar prices remained steady at the previous day's levels at the major cash markets across the country on slack demand and lack lustre trading. Crushing of cane is progressing in almost all the mills in the country, which is seen pressurizing the prices. Moreover, the carry over stocks at the beginning of the season is also weighing down the prices. The no major price advances in sugar prices are likely till 2009, given the glut situation. However, the sugar output during the season is likely to fall short of the forecasts due to delayed crushing, which is seen supporting the market in the short term. Meanwhile, the high court stay order on the privatization of 28 sugar mills and three distilleries of UP Co-operative Sugar Factories Federation has been vacated and the state cane commissioner will be looking after the privatization of co-operative sugar factories.

TECHNICALS

Sugar charts display range-bound trade. Candlestick pattern with supporting volumes and close above the short term EMAs suggest near-term firmness in the market; as does a rising RSI in the neutral region. Stochastic has flattened out in the neutral region, leaving scope for movement in either direction, while MACD is dipping steadily in the positive territory, which shows declining bullish momentum in the market. Sugar futures are expected to trade range-bound to firm in the next session.

WEATHER

Late season rains in the north and south India aid developing sugarcane crop.

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