IKAR in Mass and Industry Media

Russia Sees Record Sugar Output Boosting Exports to 5-Year High

Bloomberg

Russia expects to boost sugar exports to a five-year high this season as the country produces a record amount of the sweetener. Shipments will reach 200,000 metric tons in the 2016-17 season that started in August, the Agriculture Ministry said Tuesday. That compares with 8,000 tons a year earlier and would be the most since 2011-12, data compiled by the Moscow-based Institute for Agricultural Market Studies show.

A bigger planted area and improving yields is boosting output. While Russian exports will total less than 1 percent of the amount Brazil is set to ship out this year, the increased supply may help ease a global shortage of white sugar. Prices may need to drop by 2-4 rubles a kilogram ($30-60 a ton) for Russia to reach its export target, which may help it gain market share from competitors including the European Union, Ukraine and Belarus, according to Ikar.

Benchmark prices, which are at about 36.5 rubles a kilogram in the Krasnodar region, may fall if Russian output exceeds Ikar’s estimate of 5.6 million tons, said Evgeny Ivanov, an analyst at the institute. The nation may produce more than 5.86 million tons if losses from beet harvesting, transportation and storage are cut to a minimum, he said.

Ikar expects Russia’s sugar exports to total 40,000 to 80,000 tons.

Bigger exports will allow Russia, once the world’s largest raw-sugar importer, to send supplies to more destinations, including the Middle East, Ivanov said.

Ukraine also plans to boost sugar shipments. Exports may reach a 19-year high of 500,000 tons this season as output exceeds domestic demand, Astarta Holding N.V., the country’s top producer of the sweetener, said in August.

03.11.16

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