IKAR in Mass and Industry Media

Russia June sugar imports seen at 350,000-400,000 T

Reuters

MOSCOW, June 7 (Reuters) - Top sugar buyer Russia may import 350,000-400,000 tonnes of raw sugar in June, up from 346,000 tonnes a year ago and 188,300 tonnes in May, after a short-lived price surge on lower shipments, analysts said on Thursday.

In previous years, Russian imports rose in spring due to higher demand from soft drinks and ice cream producers. But this year imports rose from the start of the year on expectations of a higher import tariff, which failed to materialise.

As a result, imports started falling from April, pushing sugar prices up at the start of the month before they fell in the second half.

"By May 23, prices were close to 15.40-15.50 roubles ($0.597-$0.601) per kg in the Krasnodar region from 14.45-14.50 roubles at the beginning of the month, and then prices started to correct downwards," the Institute for Agricultural Market Studies (IKAR) said.

"The sugar market will be depressed for most of June under the influence of increased shipments of raw sugar," it said.

IKAR added that a new price surge was possible by the end of June on higher demand at the start of the jam-making season.

The Russian Sugar Producers Union, the industry lobby, has been trying to persuade the government to impose a seasonal duty on raw sugar imports of $250 per tonne from January to May and in December 2008 to protect domestic producers.

The current tariff is $140 per tonne.

IKAR quoted an Economy Ministry official as saying the tariff could be set in November, but the ministry itself and the sugar union both dismissed this possibility.

"The ministry is examining setting the tariff from January," a ministry spokeswoman said.

"It's rather a strange suggestion as nobody is asking that the tariff is set in November. We keep insisting on our current proposal," Sergei Mironov, the union's deputy head, told Reuters.

19.06.07

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