A sugar stockpile from 5 years of over-supply will ensure there is enough for Russian consumers and keep exports going despite lower output in the 2020/21 season, the IKAR consultancy said.
Farmers in Russia reduced their sugar beet sowing area by 18% this year as profitability was pressured by weak domestic sugar prices. Russia has doubled sugar output over the past decade to end its reliance on imports.
IKAR, a leading agriculture consultancy in Moscow, cut its forecast for Russia’s 2020/21 sugar production to 5.0-5.4 million tonnes this week from 5.6-6 million tonnes.
It is less than Russia, with an annual consumption of 6 million tonnes, needs and down sharply from the previous season’s production of 7.9 million tonnes.
Nevertheless, “there is hell of a lot sugar,” Evgeny Ivanov, IKAR’s sugar sector expert, told Reuters on Thursday.
Estimates of Russian sugar stockpile vary, with IKAR putting a figure of 1.6 million tonnes as of Aug. 1, while Russia’s Sugar Producers’ Union says it is 3.1 million tonnes.
Farmers have already harvested 3.8 million tonnes of sugar beet from 11% of the sowing area and the prospects for Russia’s sugar beet crop and sugar production may still improve if the weather is warm and precipitation is healthy in September-November, IKAR and the Union both said.
In the previous season, Russia exported 1.4 million tonnes of sugar, IKAR said, adding that it would be able to keep some exports going this season too. Its preliminary 2020/21 export estimate stands at 182,000 tonnes.
Source: Reuters (Reporting by Polina Devitt; Editing by Alexander Smith)
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