Belarusians are sweeping away sugar and sunflower oil from grocery shelves. The boom is related to the reports about rising costs for these food products.

According to forecasts, sugar is to cost 8,000 Br, sunflower oil – 11,000 Br. The Belarusian state concern of food industry Belgospischeprom representatives say that they do not plan to raise prices for sugar and oil in the next three months. However, on the condition of anonymity some sources state that price for at least one of these products is going to be raised.

Read more...

Ukraine is planning to export to Russia 300 thousand tons of sugar on preferential terms, Agriculture Minister Mykola Prysiazhniuk says.

"According to the intergovernmental agreement, after sugar beet is harvested and mutual balances are summed, Russia will consider the possibility of importing 300,000 tons of Ukrainian sugar produced from sugar beets without fee," he said.

Prysiazhniuk also expressed hope that "from this direction, we can break the blockade, and it will be a positive signal for the entire sugar industry."

According to forecasts of the Ministry of Agrarian Policy, in the current season Ukraine will produce more than 2 million tons of sugar, while the domestic market consumes 1.6 million tons of sugar a year.

source: blackseagrain.net

Read more...

Proposals in the Doha trade deal under negotiation are unlikely to open up the sugar market much as the European Union, the United States and Japan will use waivers to avoid big tariff cuts, a study issued on Monday said.

The proposals would force the European Union in particular to cut domestic prices and production, and would push up world prices by reducing the output of small, high-cost producers like Fiji and Mauritius, said the study issued by the International Centre for Trade and Sustainable Development (ICTSD).

"Despite the fact that consumers will face a higher world price for sugar, they benefit from the reduction in the cost of supporting the domestic sugar industry," according to the study, by Amani Elobeid of the Food and Agricultural Policy Research Institute at Iowa State University.

Under current proposals drafted in December last year, the European Union, the United States and Japan would cut tariffs on sugar by 70 percent, while most developing countries would cut them by 36 percent, the study notes.

This would push up the world sugar price by 1 percent as imports increase in response to lower duties. But as other countries respond to the higher price by curbing imports there is only a 0.7 percent increase in trade in sugar, it said.

World sugar production in 2008/09 was 158.55 million tonnes, while net trade -- total exports less total imports -- was 33.96 million.

However the big sugar importers and producers are likely to declare sugar a "sensitive product", allowing them to avoid tariff cuts in return for letting in a quota at low duties.

The European Union could raise its quota by 700,000 tonnes to 2 million tonnes, while the United States would increase its quota by less than 300,000 tonnes to 1.4 million.

These quota expansions, linked to domestic consumption, would represent only 3 percent of world trade, the study says.

Thailand, Malaysia and South Africa would have to expand their quotas most, while China, Venezuela and the United States would make the smallest expansions.

Other proposals would cap domestic subsidies at 5.9 billion euros for the EU and $1.1 billion for the United States.

The planned elimination of export subsidies may force the EU, already a net importer, to cut domestic sugar prices and production, the study said.

Trade liberalisation is likely to hurt small high-cost producers like Barbados, Fiji, Guyana, Jamaica and Mauritius, which have traditionally exported to the EU under preferential arrangements.

"Natural" producers like Brazil -- the world's biggest sugar exporter with 60 percent of world trade -- Australia and Thailand will benefit most from trade opening, it said.

source: forexyard

Read more...

Russia may supply $500 million in subsidies to help its sugar industry boost production by 42 percent in 2012, a draft government programme showed, though the plan will depend on good weather and non-accession to the WTO.

The latest draft of the Russian beet sugar development programme, seen by Reuters on Tuesday, said a $2 billion sector overhaul could boost beet sugar output to 4.32 million tonnes, or 67 percent of the its total sugar production, in 2012.

Russia, the world's No. 2 raw sugar importer, produced 57 percent of its sugar from domestic beet last year and expects to refine 3.05 million tonnes of sugar from this year's crop, down from a record 3.55 million tonnes in 2008.

"Every government programme should be viewed as a 'maximum' programme," said Yevgeny Ivanov, sugar market analyst at the Moscow-based Institute for Agricultural Market Studies (IKAR).

"The draft took a lot of effort to compile, but its full implementation depends on a number of different factors."

The three-year government plan, drafted by the agriculture and economy ministries along with industry lobby the Russian Sugar Producers' Union, envisages boosting refining capacity to 385,960 tonnes per day by 2012 from 284,140 tonnes currently.

To achieve this, Russia must improve seed quality and build new refineries, as well as upgrade existing plants and to cut losses during harvesting, shipment and storage.

The government is targeting investment of 59.6 billion roubles ($1.98 billion) and is prepared to supply 15 billion roubles in subsidies, the draft programme showed.

Sugar producers themselves should invest 9.3 billion roubles between 2010 and 2012, while banks can lend the remaining 35 billion roubles necessary for the programme, it said.

Russia has 76 refineries processing sugar beet. Leading producers include Razgulay, private firms Prodimex and Rusagro and French sugar giant Sucden .

WTO, WEATHER AND MARKETS

The plan targets an increase in Russia's gross sugar beet crop to 36.2 million tonnes in 2012 from 31.2 million in 2010.

But its implementation is contingent on good weather and could be threatened by volatility on world sugar markets or Russia's accession to the World Trade Organisation before 2012.

"Unfavourable weather conditions may cut yields and sugar content, as well as the planned beet crop," the government said.

And, should Russia join the World Trade Organisation, it will be forced to cut the upper level of its raw sugar import tariff to $250 per tonne from $270.

"This will cause a rise in imports to 3.3-3.5 million tonnes, equal to 60 percent of consumption volumes, and will lead to the stagnation of domestic production and the destabilisation of the domestic sugar market," the draft said.

In such a scenario, sugar refining from domestic beet would fall to 2.5 million tonnes, the government said in the draft.

Russia appeared to take a backward step in its 16-year bid to join the WTO in June, when Prime Minister Vladimir Putin said Moscow would only join the trade bloc as part of a customs union with ex-Soviet states Belarus and Kazakhstan.

The draft showed Russia planned to set equal import tariffs on raw sugar for Russia, Kazakhstan and Belarus. It proposes raising the low end of the raw sugar import tariff to $180 per tonne from the current Russian level of $165.

"Volatility on the international sugar market, coupled with the absence of efficient customs tariff regulation, may cause a decline in the sugar beet area to 600,000 hectares and of beet sugar refining by 1.7 million tonnes," the government said.

source: reuters

Read more...

Sugar prices are moving up on higher demand

Sugar cane price could rise to Bt1,000 per tonne in the 2008/2009 harvest season, which should guarantee the unchanged supply of cane from last year's level, said Prasert Tapaneeyangkul, secretary general of the Office of Cane and Sugar Board.

"This is the golden year for the sugar cane and sugar industry. From total cane production of 66.5 million tonnes in the harvest season, we can produce 7.1 million tonnes of sugar. But due to lower outputs globally, many countries have demanded higher sugar imports like India, Europe, Pakistan and China, which should boost the sugar prices," he said.

The cane output is below the target of 71.80 million tonnes.

Involving 190,000 farming families and over 1 million jobs, the sugar industry earns Bt80 billion a year, including export revenue. Last year, Thailand's sugar exports totalled Bt47 billion.

To promote the industry, the government has worked with farmers and 47 sugar mills in growing high-yield and high-sugar-content cane. Over Bt10 billion of loans has been allocated to farmers, while the government is considering the proposed Bt1 billion scheme for sugar cane-harvesting truck purchases.

"Sugar prices have risen despite economic slowdown, as many countries like India, China and Europe suffer from natural disasters which led to lower cane production. The primary cane price for the 2009/2010 harvest year should stay above Bt800 per tonne," said Thai Sugar Miller Ltd's chief executive officer Vibul Panitvong.

The previous harvest year's primary price was Bt850 per tonne.

He also believed that due to the high prices, farmers would grow more sugar canes in the next harvest season.

source:nationmultimedia

Read more...

The world has a sweet tooth. World consumption of sugar is 24 kilos per person - that's over 50 pounds of sugar for each man, woman and child on the planet. For something that has essentially no nutritional value, we sure do use a lot of it.

First, a quick review of some basic facts:

A crop year for sugar runs October to September. For example, the 2008-2009 season is October 1, 2008 to September 30, 2009. It's always good to get your crop seasons straight when you're talking about an agricultural commodity - you'll see why in a bit.

About 70% of sugar comes from sugar cane; the remaining 30% comes from sugar beets.

Countries such as Brazil, India, China, Thailand, Pakistan and Mexico grow sugar cane. France, Germany, the U.S., Russia, Ukraine and Turkey grow sugar beets. Once it is refined, sugar from cane and sugar from beets are very difficult to tell apart without a chemistry set far more complex than the ones behind the checkout stands at Wal-Mart. So rather than distinguish what it is made from, the commodity markets differentiate sugar by where it is delivered. Sugar #11 is traded on NYBOT and refers to sugar delivered to ports in the Caribbean. Sugar #5 is traded in London and refers to sugar at European ports.

For the 2007-2008 crop season, the top sugar producers looked something like this:
Brazil--35 M.ton
India--26 M.ton
European Union--16 M.ton
China--12 M.ton
Thailand--7 M.ton
Mexico--6 M.ton
Australia--5 M.ton
Pakistan--4 M.ton
Russia--3 M.ton
Cuba--2 M.ton

Total global production was 166.6 million tonnes in 2007-2008, well ahead of consumption at 157.1 million tonnes. Brazil was the clear leader, with India in second place. The European Union was thought to be oversupplied for domestic use, with 16.5 million tones produced. Of Thailand's 7 million tones, almost half was destined for export, as was almost a full three-fourths of Australia's crop.

And now for the current crop year - 2008-2009. India had fewer acres of sugar cane planted due to low prices coming off the high production in 2007-2008. Add to that some bad weather, and the picture for India changes dramatically. Production is forecast to drop 45% - with only 14.5 million tons forecasted for 2008-2009. A drop of that magnitude in the world's No. 2 sugar producer is bound to have some serious repercussions around the world, and global production is expected to drop 4.7% from the previous year down to 158.8 million tones, while consumption is expected to rise 3.2% to 162.1 million tonnes.

A classic commodities supply squeeze. By definition, that 3-million-tonne gap has to be closed, either through mysterious arrivals of new supply from storage or crop yields, or consumption has to fall. In either case, higher prices are the mediator.

First, At India
With India currently consuming around 22.5 million tones of sugar each year, a crop of 14.5 million tons means that India goes from being a net exporter to a net importer in one fell swoop.

There have been a couple of consequences from the small crop. Sugar mills that usually run at least into April closed in March this year due to a lack of cane to process. In response, the government instituted a program that allows cane mills to import raw sugar duty free, as long as they export a similar amount of refined sugar within the next two years.

There have even been suggestions that India may drop import tariffs on refined sugar, tariffs that currently stand at 60%. Of course, there are general elections coming in April and May, so it could be political positioning. But as of now, there has been no official action on the proposal, and according to the commerce secretary, G. K. Pillai, there won't be.

The sugar deficit in India has also affected Indian plans to increase ethanol use. An original goal of 10% ethanol blending was delayed because of the recent decline in fuel prices. In a time-honored tradition (not in India, everywhere), they made up for their immediate failure by doubling down: They announced the goal of having a 20% blending rate by 2017. Currently, India has the capacity to make around 2,200 million liters of ethanol. Of that, 750 million liters goes to the liquor industry, and 650 million liters goes to the chemical industry. The remainder is used for fuel blending. Those industries are paying 27 to 28 rupees per liter, while the fuel industry pays a fixed 21.50 rupees. If the Indian government wants to increase the amount blended for fuel, it will need to change the financial incentives.

Outside India
With India's production so low and global production forecast to be in deficit for the first time in four years, sugar prices have been remarkably steady, actually falling about 10% since October 1 (when the crop year started). Of course, back then, these deficits weren't expected, or more sugar cane would have been planted. On a year-to-date basis, prices have risen around 7%.

At the end of March, some analysts said the price increase was only the beginning, and analysts such as the Standard Chartered Group were forecasting sugar futures to rise as high as 15 cents a pound, with global demand exceeding production. Additionally, Bloomberg reported that Tom McNeil, a senior analyst with Kingsman SA, suggested that production may continue to be in deficit for 2009-2010.

"If that eventuates, a second year of deficit, certainly supply to the market will be tested and under those circumstances prices become very volatile," McNeill said. He declined to give a specific price forecast. "Sugar is probably one of the commodities with a slightly better story than most other commodities."
Additionally, on Friday, an Inside Futures article said that the Czarnikow Group is predicting that Brazil's producers will see a reduction in the amount of cane crushed from now through March 2011 because of halted mill expansions due to the financial crisis. Of course, ethanol demand in Brazil could be partially offset by low crude prices putting downward pressure on ethanol prices.

But either way, it sounds like sugar is set to rise, right?

Well, maybe.

Here's the crazy thing - the market may already be looking ahead to the 2009-2010 crop year; remember, the crop year starts October 1 when planting begins. But according to Bloomberg's headline from Friday, "Sugar Drops Most in Month on Concern Indian Output May Rebound," the market is already prepared for Indian farmers to plant like crazy.

So if the market is already looking ahead to next year, can the analysts be right that sugar will reach 15 cents a pound? Or has that ship already sailed, with the year's comparatively stellar 7% growth being the full extent of the bull market in tooth decay. In other words, maybe next year's crop is already priced in even before the first plant is in the ground.

On a more local level, April 1 marked the statutory date under the Farm Bill that the U.S. could start mucking with import quotas on sugar. This has caused a flurry of lobbying by food manufacturers who could profit from access to even-cheaper foreign sugar (right now, sugar imports are capped at 1.3 million tonnes for 2009). On the other side of the equation is the American Cane Sugar Refiners' Association and American Sugar Alliance, which state that an increase in imports of foreign sugar would be detrimental for the domestic sugar refiners and beet processors, and that the domestic market is well-supplied, with prices on the low side and that manufacturers able to get the sugar they need.

I don't believe that the government will decide to import more sugar, if for no other reason that any activity on sugar draws attention to what are fundamentally protectionist policies - but I've been known to be wrong before.

Read more...

Brazil's sugar markets saw a trickle of trade this week with few buyers interested in sugar from cash-strapped mills, industry participants said Wednesday.
Nearby May sugar on ICE Futures U.S. was up 6 points to settle at 12.73 cents a pound after giving up early gains on profit-taking, weakness in key commodities and a rally in the U.S. dollar.

One U.S. dollar was at 2.28 Brazilian real on Wednesday, from around BRL2.30 on Tuesday, doing little to stimulate Brazilian sugar exports.
"We saw some trade as sugar tries to break 13 cents per pound during rallies, with some producers willing to sell and mainly speculators buying," said Alex Oliveira, a sugar broker at Newedge USA in New York.

Brazil's sugar trade, overall, remains slow with little interest from buyers in Brazil or abroad, he said. This should change in the second half of 2009 when such countries as India, China and Russia will have burned through their stocks. "Then they will start buying," Oliveira said.

Buyers were asking for discounts this week for very high polarization sugar, or VHP, of around 45 points under the ICE May contract, said a broker at Uniao Corretora, while sellers wanted 50 points under the same contract.

The broker said that this year many mills are desperate for income to pay debts or bills, and needed to begin cutting their cane earlier. This puts pressure on the sugar and ethanol prices, he said.

Brazilian mills in the main center-south sugarcane region usually start harvesting in April and May. Around 35 mills in all have begun operations in the west of Sao Paulo state and Parana.

Crystal sugar prices dropped at the mill gate in Sao Paulo to BRL46.77 per 50-kilogram bag on Monday compared with BRL46.89 per bag on Monday, according to the Center for Advanced Applied Economic Studies.

Many industry buyers expect sugar prices to fall further, he said.
Trading firms were doing inter-company trade, said industry participants. "Cargill, Tate & Lyle, Sucden and Louis Dreyfus have all been doing some intracompany trade, while industry buyers remained out of the market," said the trader at a major U.S. sugar exporter.

More trade was conducted last week when companies rushed to conclude deals before the end of the month, he said.

A broker at a Sao Paulo brokerage said that sugar prices already include gains fed by concerns that less sugar will come from major world sugar producer India.

India's 2008-09 sugar output may fall 45% to 14.5 million tons from a year ago due to severe weather problems, and the decline in acreage has lowered cane availability, forcing mills to shut down, said the director-general of the Indian Sugar Mills Association this week.

Brazilian sugar exporters shipped 1.3 million metric tons in March, compared with 1.4 million tons in February, the Foreign Trade Ministry said Wednesday.
Brazil is the world's No. 1 sugar producer and the No.1 sugarcane-based ethanol producer.

SOURCE: martketwatch

Read more...

NEW DELHI: Prices in the world sugar market made marked gains in the last week of February on the back of the Indian government mulling the import
of white (refined or processed) sugar at zero duty .

Quotes for the London Daily Price (LDP) for white sugar for May 2009 closed for the week (ending March 1)at $399.60 or $5.60 higher than the previous week s ((week ending February 22) closing quotation. Tht works to Rs 20,419. 56 per tonne, up from a lower Rs 19,593.62 ($394)/tonne quoted on February 20 for May deliveries. The landed price for refined sugar is estimated by industry at around $420-$430/tonne currently.

Should the government decide finally to import processed sugar this month to keep domestic prices in check, this would mean high priced imports for India. Meanwhile, May delivery quotes for New York SPOT No. 11 raw or unprocessed sugar, already allowed for import at zero duty by the government but showing compartive slowness in the pace of price increase, closed at $18.52 higher.

That works out to $ 306.44 per tonne of raw sugar., or around Rs 15, 500/tonne. At 13.90 cents per pound, the price is already much higher than the 11.6 per pound level it hit in 2008. If the governemnt allows white sugar imports, though, prices, which are understood to have dipped by 7% already, could go down further.

source: ET

Read more...

The 2006-2009 scheme for the restructuring of the European sugar industry resulted in the renunciation of 5.8 million tonnes of quota, very close to the initial objective of 6 million tonnes.

At the end of this 4-year process, a key element of the 2006 sugar reform, EU quota for sugar and isoglucose has been lowered to 14 million tonnes (of which 13.3 million tonnes for sugar). EU sugar production is now concentrated in 18 Member States (as opposed to 23 before the reform) which enjoy favourable agronomic conditions, and nearly 70 percent of production is in 7 Member States with the highest sugar yields. Domestic prices are showing a downward trend consistent with the objective of the reform to achieve a sustainable and competitive EU sugar sector.

"I am pleased to say that the sugar reform has been a success," said Mariann Fischer Boel, Commissioner for Agriculture and Rural Development. "This was one of the centrepieces of my current mandate and it's gratifying that we are so close to our ambitious target. Our sugar sector was in desperate need of reform. More sustainable production and prices promise a competitive future for our producers."

Background on the sugar reform

In February 2006, EU agriculture ministers formally adopted a radical reform of the EU sugar sector. This brought a system which had remained largely unchanged for almost 40 years into line with the rest of the reformed Common Agricultural Policy. The key to the reform was a 36 percent cut in the guaranteed minimum sugar price (from €631.9/tonne in 2006/2007 to €404.4/tonne from 2009/2010), compensation for farmers and a Restructuring Fund, financed by sugar producers, to encourage uncompetitive sugar producers to leave the industry.

In the context of the financial and economic crisis, the Commission decided on 13 February to allow Member States to advance the payment of 100 percent of the 2008/2009 restructuring aid to June 2009. Several Member States already announced that they will use this possibility to alleviate the financial strain encountered by sugar companies.

No need for 'preventive withdrawal' at present

Last March and October, the Commission concluded that the fundamentals of the EU sugar market were sufficiently healthy and that there was no need to impose an obligatory withdrawal of sugar for the current marketing year 2008/09. An early assessment for the next marketing year (2009/2010), leads Commissioner Fischer Boel to the conclusion that a preventive withdrawal is not necessary on this occasion either. This assessment is based on very provisional estimates, notably for imports. It will be reviewed in October on the basis of updated estimates for beet and sugar production and for imports.

In February 2010, the situation will again be reviewed to see whether there is a need for "preventive withdrawal" for the marketing year 2010/2011 or a "final cut" i.e. a further reduction of quota.

source: flex-foods

Read more...

Moscow, Jan 21 - Russia may raise its basic raw sugar import tariff to $180 per tonne from $140 from June 1 2009, the Chairman of the Russian Sugar Producers' Union, the industry lobby, Andrei Bodin said on Tuesday.

"This measure is necessary to maintain the refining volumes of sugar from domestic beet, which this season is expected to reach a record 3.5 million tonnes," Bodin told Reuters.

"However, depending on the dollar rate, this tariff may yet be adjusted," he added.

A working group of the government Commission for Protective Measures in Foreign trade, a body responsible for drafting customs tariffs, has approved the new tariff at a meeting on Tuesday, the Agriculture Ministry said in a separate statement.

Bodin said he expects the commission to endorse the proposal in about a week. Then it will be sent to the government to be signed into law.

Russia consumes around 5.8 million tonnes of white sugar a year. In the last few years it has managed to refine more than half of this volume from domestic beet and most of the rest from imported cane raws.

It has regulated raw sugar imports by a base tariff of $140 per tonne. From December 2007 to June 2008 it applied a seasonal tariff of $220 per tonne to protect domestic producers from excessive imports.

A tariff of $220-$270 per tonne applies from December 2008 to the end of May 2009. The level of the tariff depends on the price of sugar in New York. So far it has been kept at the lowest level of $220 per tonne.

Read more...

MOSCOW, (Reuters) - One-third of Russia's sugar refineries could close in the next two years and 2008 imports of raw cane sugar are likely to drop as the world financial crisis hits production, a leading agricultural analyst said on Tuesday.
The Institute for Agricultural Market Studies (IKAR) said many sugar firms in Russia, until recently the world's largest raw sugar importer, had eliminated all bonus and social payments to employees and had started reducing staff and salaries.
"Many companies, in their battle to cut costs, have frozen practically all investment projects," IKAR said in its monthly sugar market review.

Some Russian refineries, with the sugar beet processing season now finished, had sent their employees on unpaid leave, IKAR said.
As a result of the crisis, it estimated about 26 refineries could be closed in 2009 and 2010 while another 20 would have to think about upgrades. Only 38 refineries are "safe", IKAR said.

Razgulay, Russia's third-largest sugar producer, is in talks with rivals, including market leader Prodimex Group, about consolidating assets and eliminating inefficient plants, its general director told Reuters on Nov. 19. Russia this year ceded its position of the world's largest raw sugar buyer to the European Union due to EU sugar market reforms and a cut in Russian imports.

IKAR said international companies accounted for a larger share of Russian raw sugar imports than previously, as domestic firms had slashed shipments ahead of the introduction this month of a higher seasonal tariff.

The new tariff, $220-270 per tonne, will run for six months from December and replaces a previous import tariff of $140. The tariff is pegged to New York sugar prices and will stay at its lowest rate of $220 per tonne in December and January.
"Many (Russian) companies have stopped raw sugar imports ahead of the setting of the tariff, or cut volumes dramatically. The share of international companies in imports has risen as a result," IKAR said.

SHRINKING RAW SUGAR IMPORTS
Russian raw sugar imports could shrink to 80,000 tonnes in December from 170,000 tonnes in November due to the financial crisis and the higher tariff, IKAR said.
Official November sugar import data are not yet available.
Federal Customs Service data released on Monday showed January-October 2008 raw sugar imports fell to 2.02 million tonnes from 2.70 million tonnes a year ago.
As a result, IKAR has slightly revised its forecast for Russian imports in 2008 to 2.45 million tonnes from its previous estimated of 2.43 million. In 2007, imports totalled 3.23 million tonnes.

IKAR said it expects white sugar refining from imported raws to decline this year to 2.49 million tonnes from 2.86 million tonnes in 2007.
But higher yields from this year's beet crop prompted IKAR to raise its forecast for white sugar refined from domestically grown beet to 3.4 million tonnes, from 3.28 million tonnes previously.

The country's main sugar industry lobby, the Russian Sugar Producers Union, expects sugar output from this year's beet crop to be 3.3 million tonnes.
In the last few years, Russia has refined more than half of the approximately 5.8 million tonnes of white sugar it consumes annually from domestic beet, producing most of the remainder from imported cane raws and regulating imports by tariffs.

Read more...

MOSCOW, Nov 10 (Reuters) - The European Union could replace Russia as the world's largest raw sugar buyer this year as the global financial crisis forces a sharp reduction in Russian purchases, a Moscow-based report said on Monday.
The Institute for Agricultural Market Studies (IKAR) said it expected Russian raw cane sugar imports to fall by a quarter to 2.43 million tonnes in 2008, from 3.22 million tonnes in 2007, due mainly to the crisis.
"For the first time in several decades, Russia may give up its position as the largest sugar importer to the European Union," IKAR said in its monthly sugar market report.
Russia, which consumes about 5.8 million tonnes of white sugar annually, refined more than half of this volume from domestic beet in both of the last two years, producing most of the remainder from imported raw cane sugar.
It replaced a raw sugar import tariff of $140 per tonne with a higher duty of $220 per tonne from December 2007 to the end of May 2008 to protect domestic producers from excessive imports.
A tariff of $220-270 per tonne of raw sugar, pegged to New York prices, will be applied for six months from December 2008.
"Imports of raw sugar in August-November, with unloading before January ahead of the seasonal tariff, are expected to be 630,000 tonnes compared to 930,000 tonnes a year ago because of the financial crisis," IKAR said.
It added that exports of white sugar refined in Russia from imported raws would shrink to 46,000 tonnes this year from 313,000 tonnes in 2007, while white sugar imports would fall to 158,000 tonnes from 313,000 tonnes.
Russia refined 2.27 million tonnes of sugar from imported raws in the first 10 months of this year, down from 2.65 million tonnes a year ago, industry lobby the Russian Sugar Producers' Union said on its Web site, www.rossahar.ru.
IKAR has revised up its forecast for domestic sugar refining from this year's sugar beet crop to 3.05 million tonnes from an earlier estimate of 2.93 million tonnes. The producers' union forecasts output of 3.1 million tonnes.
By Nov. 1, Russia had refined 2.0 million tonnes of sugar from this year's crop of domestic beet, up from 1.87 million tonnes a year ago.
IKAR said domestic stocks of both raw and white sugar by the end of the year were expected to be 2.4 million tonnes, compared with 2.68 million tonnes at the end of 2007 and 2.10 million tonnes at the end of 2006.
It added that stocks of white sugar alone in Russia in August-December 2008 were higher than in the previous four years.
"The market is sitting on excessive stocks, while demand is weak due to seasonal factors," IKAR said.
"With current consumption of around 5.8 million tonnes and imports practically absent in December 2008-May 2009, this may make the domestic balance quite tight by April-May 2009."
IKAR expects domestic sugar prices to rise to $700 per tonne in April-May 2009 from the current $524 per tonne if the price of raw cane sugar remains in the region of $290 per tonne CIF Novorossiisk.

Read more...