Sugar Futures closed unchanged on Wednesday on good domestic supplies and steady physical demand despite increase in import duty to 50% from 40%. India’s sugar production is set to rebound from a seven-year low as above-normal monsoon rain in the world’s largest consumer helps the cane crop that will be crushed from Oct. 1. According to government data, Sugarcane acreage in the country was at 47.5 lakh ha, higher than 44.8 lakh ha a year ago.

ICE Raw sugar futures settled higher due to strong Real. Moreover, contract has been boosted by worries about tighter nearby deliverable supplies. Biweekly cane industry data from Brazil showed millers in the country's center-south region increased sugar output in the second half of June.

Outlook

Sugar futures may trade sideways on sufficient supplies in the domestic market Production is expected to be higher by 25% in 2017/18. Increase in FRP is encouraging farmers to take sugarcane crop while good sowing progress in the country will keep pressure on the sugar prices.

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