Sugar news from Russia, July 20, 2020

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RUSSIA

Rusagro has published 2Q 2020 operating results. In the 2nd quarter 2020 the revenue of the sugar segment decreased to 9.0 billion rubles or by 19%, compared to the same period in 2019. Sugar sales in Q2 2020 year-on-year decreased by 15% - to 297 thousand tons, sugar sales price fell by 11% year-on-year - to 26.9 rubles/kg excluding VAT. However, compared to Q1 2020 sales volumes (+ 76%) and sugar prices (+ 8%) showed growth. In Q2 2020 Rusagro produced 52 thousand tons of sugar. Due to the expansion of capacities for desugarization and production of sugar from molasses, sugar production increased by 464% YOY.

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According to the press service of Soyuzrossahar, on April 16, the Government signed Decree No. 522 (hereinafter referred to as the Decree), which allows sugar producers to conclude agreements on the export of white and raw sugar outside the customs territory of the Eurasian Economic Union (EAEU). The main goal is to support the export of Russian sugar against the background of low prices on the world market by increasing its efficiency in the formation of large consignments and optimizing logistics costs. In pursuance of the clause of the provisions of the Resolution, the Ministry of Agriculture of Russia, based on the balance of supply and demand for sugar in the domestic market, prepared and posted for public discussion a draft Order, which sets the required volume of sugar exports outside the EAEU in the amount of 1 000 000 tons for the period August-July 2020/21.

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