Expert Chaslau Koniukh
  • Biography
  • Analytics
  • Companies and corporations
  • Global investment
  • Investors and Entrepreneurs
  • Market terminology
  • Stock Market
  • World exchanges
Russian sugar industry

Russia’s sugar industry is in crisis: causes and solutions

03.12.2020
2 min read

Russian sugar industry: how to cope with overproduction

The world sugar industry is going through some bad times, but in some countries the situation is quite critical. For example, in Russia the production volume of the product is being reduced and at least 3 plants are closing. The reason for this step is explained by the fact of overproduction. Several years in a row there were high yields of sugar beet in the country, respectively, all the capacities were working at full capacity. The domestic market turned out to be oversaturated, so producers have to look for foreign buyers, but the world market is also oversupplied with raw materials. This has led to lower sugar prices. On the one hand, Russia can hold on to its stocks until the prices go up, but it is not known when this will happen. Here is another problem – in Russia most of the raw materials are produced from sugar beet, while in the world cane sugar is preferred. Nowadays, almost all exports go to the post-Soviet countries, including Belarus and Central Asian states. Experts point out that the Russian product can be supplied to the Middle East, since large volumes are consumed there. Besides, Russia is looking for ways of cooperation with Serbia, China and a number of other countries, but their markets are highly competitive with permanent sellers. Therefore, Russia is unlikely to become a serious sugar exporter in the near future.
According to experts, the Russian industry is not intended for the production of raw materials for sale, unlike other countries, which produce sugar with the calculation of exports. Enterprises of the Russian Federation were built on the condition that they will provide products exclusively for their country and CIS countries.

Russian sugar industry

However, things are not so bad in the domestic market. According to specialists, the situation is not stalemate. Rather, there is a process of reform and change in the market. The industry is developing, increasing volumes, but there is no supply and cooperation with other countries at all. The wrong approach to the organization of redistribution has led to an oversupply of sugar and a decrease in its value. As a result of this situation, some enterprises could not withstand the competition and had to shut down production.
It should be noted that overproduction in the domestic market has been observed for a long time, and aggravated after the fall in world prices in 2016. In 2017, Russia began to produce more than 6 million tons of raw materials, and these figures remain today. In the previous period the cost of sugar in Russia was 23-24 roubles per kg, which is the optimal indicator for the enterprises is 32 roubles per kg. The same trend will be maintained this year as well.

Share
0
Previous Post World financial institutions are investing in Shanghai Next Post Intraday trading: basic approaches for trader activity

You Might Also Like

Ministry of Finance and Central Bank
Economic
The Ministry of Finance and the Central Bank announced the withdrawal of the country’s main regulator from Sberbank capital
13.12.2020
PGNiG
Economic
PGNiG intends to reduce its dependence on Russian gas
24.09.2020
Saudi Arabia's plans
Economic
How Saudi Arabia’s plans to reduce the cost of oil may turn out to be
02.01.2021
Russian GDP growth
Economic
What GDP growth Russia showed in 2019: overview of the Ministry of Economic Development data
13.11.2020
Russian wheat
Economic
Russian wheat could become one of the main export products
12.01.2021
Negotiations between the U.S. and China
Economic
US-China negotiations: expectations and concrete steps to resolve the situation
04.10.2020

Recent Posts

  • 1minimize risks
    Bank of Russia recommends the Moscow Exchange to minimize the risks of contracts with negative prices
    10.04.2021
  • 2Disney Plus
    Corporation analysts: prospects of Disney Plus streaming service
    09.04.2021
  • 3Tencent Company
    Tencent company pressed Facebook and became the leader of the social networks segment
    08.04.2021
  • 4financial trap
    The Chinese government can expect a financial trap
    07.04.2021
  • 5Ingvar Kamprad
    Ingvar Kamprad: biography of the founder of the famous IKEA store chain
    06.04.2021

Popular Posts

  • American Stock Exchange: the history of the American Stock Exchange 0
  • Free margin and leverage: basic concepts on the Forex exchange 0
  • Alice Walton: how does the heiress of the Walmart family empire live 0
  • Where will the first Tesla plant in Europe be located? 0

Social

Editor's Picks

Chaslau Koniukh

American bankers from JPMorgan and Goldman Sachs advise to invest in gold: review by Chaslau Koniukh.

Spokesperson
17.08.2020
Expert Chaslau Koniukh

Chaslau Koniukh on the analysts’ opinion on the key stake size change soon

Spokesperson
18.06.2020
expert Chaslau Koniukh

Chaslau Koniukh: Internet trade market in Russia may reach 2.78 trillion rubles.

Spokesperson
30.05.2020
Will the U.S. oil shale industry be able to quickly recover from the crisis: A Review by Chaslau Koniukh

Will the U.S. oil shale industry be able to quickly recover from the crisis: A Review by Chaslau Koniukh

Spokesperson
16.05.2020

Latest Posts

minimize risks
Bank of Russia recommends the Moscow Exchange to minimize the risks of contracts with negative prices
10.04.2021
Disney Plus
Corporation analysts: prospects of Disney Plus streaming service
09.04.2021
Tencent Company
Tencent company pressed Facebook and became the leader of the social networks segment
08.04.2021

Chaslau Koniukh

Expert Chaslau Koniukh

Chaslau Koniukh is an international financial expert, a professional investor, an experienced analyst and a practicing trader. He advises European entrepreneurs; holds lectures on investment topics; is the author of scientific articles on work at the stock market.

Recent Posts

  • 1Caesars Entertainment
    Caesars Entertainment Company now owned by Eldorado Resorts
    11.04.2021
  • 2minimize risks
    Bank of Russia recommends the Moscow Exchange to minimize the risks of contracts with negative prices
    10.04.2021
  • 3Disney Plus
    Corporation analysts: prospects of Disney Plus streaming service
    09.04.2021
Expert Chaslau Koniukh
  • Facebook
  • Twitter
  • Youtube
  • Instagram
  • Biography

Expert Chaslau Koniukh: brief biography and path of formation

Let’s Socialize