Russian and CIS sugar news, Jan 24, 2019

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Lipetsk Region plans to increase sugar beet crops in 2019 by more than 9.6 thousand hectares, to reach 137.6 thousand hectares, the regional ministry of agriculture reports.

By the end of the 2018/19 season six factories of the Lipetsk region have produced 756.1 thousand tons of sugar, which is 23 thousand tons less than in the record season of 2017-2018. The sucrose content in sugar beet significantly exceeded the figures of the past season and has grown to 19.22%, according to the Department of Agriculture of the Lipetsk region.

According to price monitoring data for the period from 17.01.2019 to 24.01.2019 the US dollar rate dropped by -0,7% (on 17.01 - RUR 66,76/$, on 24.01 - RUR 66,33/$). Ruble Moscow wholesale price for sugar dropped by 0,50 RUR/kg (-1,29%), Krasnodar wholesale price dropped by 0,50 RUR/kg (-1,37%). US dollar Moscow wholesale price for sugar dropped by $0,004/kg (-0,69%), Krasnodar wholesale price dropped by $0,004/kg (-0,73%).


The decline of wholesale sugar prices continues against the backdrop of "missing end demand." The minimum price level basis Krasnodar has reached 35.50 rubles / kg. Market participants justify such drop by lack of demand. However, the shortage of demand (total stagnation, etc.) on the sugar market has been discussed for several years. Most likely, there is some substitution of concepts, and “end-demand” means the demand on the open market. In recent years, there has been a restructuring of the market: network companies have occupied a significant part of retail chain, confectionery companies have expanded, and they have simply established regular relationships with manufacturers. The share of intermediaries in the market decreases, creating the impression of a certain decrease in demand. This scenario is also supported by a significant number of companies that ceased trading sugar. Anyway, the grounds for stopping the fall are not yet visible, perhaps we will go down to 35 rubles / kg, and if we once break through this level, it will be even lower.

According to reports from the cities bordering with Kazakhstan, Kazakhstan sugar is offered for sale there. So, in Omsk offers are made at the price of 38 rubles/kg (the railway tariff from Krasnodar to Omsk is about 3200 rubles/ton)

The pace of import railway shipments is starting to recover, for 23 days of January, total 22 thousand tons of Belarusian sugar and 204 tons of Ukrainian were imported to Russia by railway (Radekhovsky sugar mill (UKR) delivered commodity to Kaliningrad). Export continues to be low, from the beginning of the month only 6.4 thousand tons were exported (in December 2018 – only 13.6 thousand tons). The main exporters were Olkhovatsky and Elan-Kolenovsky sugar factories. Transit shipments also fell significantly, in 24 days of January, only 8.9 thousand tons of white sugar were shipped transit by the Russian rail (7.7 thousand tons from Ukraine and 1.2 thousand tons from Belarus.


As of January 21, 2019, total 12.58 million tons of beets were processed and 1706.3 thousand tons of sugar produced in the country, reports Ukrtsukor.


According to the analysis of data by National Statistics Office of Georgia, conducted by Sugar.Ru, in December 2018 the import of sugar (white and raw) (HS code 1701) has made $1.7 million ($5.2 million in 2017). Total imports of raw and refined sugar to Georgia in January - December 2018 has made $58.3 million ($67.6 million in 2017). Export of sugar (white and raw) has made $0.0 in January - December 2018, total for 12 months 2018 - $255.6 thousand (in 2017 - $3.9 million).



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