Mumbai, Oct 09 - Sugar futures started the session to the downward trend amid speculative selling on the National Commodity and Derivatives Exchange [NCDEX] Tuesday.

Traders say demand for sugar will increase during the festivals of Navratri, Dussera and Ramzan this month. Prices are likely to gain further as Diwali demand will be seen in the market by the end of October.

In other news, domestic mills are estimated to have so far sold between 8,00,000 metric tonnes and 9,00,000 tonnes of raw sugar for exports from the new harvest.

Industry participants say most of the sales are for deliveries between December and March and are directed to the Middle East, Indonesia and Bangladesh. The participants do not consider global prices to be very attractive for exports and do not think it to be viable to offer sugar below $265/tonne, free-on-board, as the Indian rupee has strengthened against the US dollar. India's sugar marketing year runs from October to September but several sales took place well in advance.

October sugartradedRs. three lower atRs. 1,306 per quintal at 10.30 hrs IST on NCDEXwith a volume of 2,830 tonnes getting traded. Earlier, the contract openedRs. three lower at Rs. 1,306 per quintal and noted movements between Rs. 1,302 and Rs, 1,307 per quintal.

The November sugar dropped Re. 1 to open at Rs 1265 per quintal, and fluctuated between Rs 1262 and Rs 1266 per quintal. The contract is currently down Re 1 to trade at Rs 1265 per quintal with a volume of 810 tonnes.

The December sugar went down Rs 2 to open at Rs 1217 per quintal, and later tossed between Rs 1217 and Rs 1221 per quintal. The contract is currently steady at Rs 1219 per quintal.

The January sugar futures lost Rs 4 to open at Rs 1213 per quintal.