Bajaj Hindusthan Sugar shares rose around 8% to Rs 22, while Shree Renuka Sugars and Dhampur Sugar Mills gained 6-7%. Balrampur Chini Mills climbed over 3%, while EID Parry India advanced nearly 2%.
Why are sugar prices rising?
India’s sugar demand typically rises between August and November as the country celebrates festivals such as Ganesh Chaturthi, Dussehra and Diwali, driving demand for sweets, biscuits and other confectionery products. Manufacturers of these products also build inventories ahead of the festive season, further supporting sugar demand.Last month, the government directed dealers to hold sugar stocks for no more than 30 days to bolster supplies. Despite the move, sugar prices have risen 10% over the past month to record highs, with analysts expecting prices to remain elevated for at least the next three months. Meanwhile, patchy rains and dry weather conditions have affected sugarcane output. Since the crop requires substantial water for irrigation, concerns over supply have added to upward pressure on prices.
Also read |India tightens sugar stock limits to tame record prices
India to cut sugar import duty?
India, the world’s second-largest producer of sugar, is considering reducing its import duty on the commodity to help curb domestic prices that recently climbed to a record, Bloomberg reported. Officials are weighing plans to lower or scrap the 100% tax on inbound shipments in an effort to boost local supplies, the report said, citing sources. This come just before a seasonal surge in sugar demand for the festival season, adding to the incentive to rein in rising prices.Also read |Why is market rising today? Sensex rallies 500 points, Nifty tops 24,200. 5 key factors behind market rebound
(With inputs from agencies)
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