Sugar Flies High, Boosted By Lower Indian Output Forecasts
Raw sugar prices extended its rally to a third consecutive day on Thursday amidst mounting expectations that India will lower sugar import duties to control rising local price which is due to a decline in the country’s production.
The outlook for Indian shrinking supply has boosted domestic prices 11 percent since the start of December. However, the country has maintained an import duty of 40 percent on the commodity.
According to market source, drought that damaged the crop in the country’s top producing region two seasons in a row may send India’s production down to a seven-year low.
Earlier in the month, the Indian Sugar Mills Association stated that it lowered domestic output forecast for 2016-1017 to 21.3 million tons, down from its 23.37-ton estimate in September. Market analysts were even more pessimistic, expecting only 20.4 million metric tons of India raw sugar production for the year that began October 01, 2016.
Buy Stop at 21.00, Take profit 21.30, Stop loss at 20.85