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IKAR in Mass Media

Russia may cease to be top raw sugar buyer-analyst

28 июня 2007 года

MOSCOW, June 26 (Reuters) - Russia may relinquish in 2008 its position as the world's top raw sugar importer due to current oversupply, more domestic beet refining and white sugar imports from neighbouring countries, a leading analyst said on Tuesday.

"The world should start preparations for changes on the sugar market," Yevgeny Ivanov of the independent Institute for Agricultural Market Studies (IKAR) told Reuters.

Russia consumes over 5.5 million tonnes of white sugar a year and last year refined a record 3.27 million tonnes from domestic beet.

Customs data show Russia imported 2.63 million tonnes of raws and 111,200 tonnes of white sugar in 2006. Ivanov added Russia imported at least 215,000 tonnes of white sugar from Belarus, not accounted for in the official statistics.

The possibility of setting a seasonal import tariff of $250 per tonne on raw sugar next year, instead of the current $140, could cause imports to rise in the interim period, which would raise domestic stocks that are already larger than last year's.

On Wednesday, the body responsible for drafting government orders, the Commission for Protective Measures in Foreign Trade, is scheduled to examine whether to set this tariff from January to May and in December 2008.

"If the tariff is adopted, imports will rise. Not now, but in November and December, as nobody is going to store raws for half a year, waiting for the refineries to finish processing the beet crop," Ivanov said.

SEASONAL TARIFF

Russia's plans to introduce a seasonal tariff this year, which failed to materialise, caused a surge in imports from the end of 2006. On top of the record beet sugar output, this caused a glut and pushed prices down.

Ivanov said large shipments of raw sugar were approaching Russia, partially meant for processing inside the country and subsequent export to Central Asian countries.

"But the Central Asian import capacities are restricted, and if it all lands here, we will witness another price decline in July. Even the seasonal tariff will not save the market from a long depression," Ivanov said.

Ivanov forecast rising beet sugar production in Russia.

"I believe that this year will continue the rising sugar production trend. We may refine roughly 3.4 million tonnes of sugar from this year's crop," he said.

The area sown with sugar beet this year was 1.037 million hectares, up 3.4 percent from 2006. Ivanov added larger areas had been sown this year in regions with an excess of refining capacity and smaller areas in regions with a shortage.

"This means that losses may be lower, as in previous years much of the beet rotted as refineries were unable to process it in time," he said.

NEIGHBOURS' SHIPMENTS

Ivanov said Russia was examining granting Ukraine an annual import quota for white sugar from 2008, under which sugar could be shipped at a discount to the current $340 per tonne tariff.

Russian Agriculture Minister Alexei Gordeyev said last week that Ukraine, which last year produced 600,000 tonnes more white sugar than it needed, could in the next two years replace Brazil as the major supplier of sugar to Russia.

"I'm not sure how big the quota is going to be. Maybe 100,000 tonnes, maybe 1 million. But it will be a substantial contribution to imports from Belarus," Ivanov said.

Minsk and Moscow have signed an agreement limiting white sugar shipments from Belarus to 180,000 tonnes this year and 100,000 tonnes in 2008.

Source: Reuters  |  #sugar   |  Comments: 0   Views: 121

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