MUMBAI: Sugar prices in India have jumped by more than 3% in a fortnight to their highest level in six years, traders and industry officials said, as limited rainfall in the country’s key growing regions raised production concerns for the upcoming season.
This could add to food inflation and discourage New Delhi from allowing sugar exports, supporting global prices which are near their highest in more than a decade.
“Sugar mills are worried that production could fall sharply in the new season because of drought.
They are not willing to sell at lower price,” said Ashok Jain, president of the Bombay Sugar Merchants Association.
Higher prices will, however, improve margins for producers such as Balrampur Chini, Dwarikesh Sugar, Shree Renuka Sugars and Dalmia Bharat Sugar, helping them make payments on time to farmers, dealers said.
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