Sugar (Russian market)

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2023: Growth of sugar production in Russia to 6.6 million tons

The production of beet sugar in Russia in 2023 reached 6.6 million tons, which is 670 thousand tons more than a year earlier. The volume of production of these products turned out to be almost a record in the history of the market - the largest volume was recorded only in 2019. This is evidenced by the data of Soyuzrossahar, published on January 17, 2024.

By the beginning of 2024, 40 out of 66 sugar plants were engaged in processing sugar beets of the 2023 crop against 29 plants in 2022. Daily sugar production by the beginning of 2024 was estimated by experts at 19 thousand tons, which is 7.4 thousand tons higher than daily sugar consumption.

The Institute for Agricultural Market Studies (ICAR) predicts sugar production this season (August 2023 - July 2024) at almost 6.8 million tons, which is 10.5% more than a season earlier. The increase in production is associated with an increase in beet harvest, which is estimated at 52.5 million tons (48.9 million tons a year earlier). This will happen both due to the expansion of areas for beets (by 4.8%) and an increase in yield (by 3.7%). In addition, the sugar content of beets was higher than last year. Beets in Russia are grown in 24 regions.

As the Ministry of Agriculture noted at the end of 2023, the cost of Russian sugar remains one of the lowest in the world, which ensures demand for it, including from industrial consumers. According to the ministry, in 2023, sugar beet production increased significantly: the gross harvest of the crop is 51.7 million tons, which is more than 4 million tons higher than in 2022.

The production of sugar beets depends on imported seeds. According to various estimates, 90 to 96% of this culture is produced from them. The Ministry of Economic Development said that quotas for seed imports may begin to operate on February 1, 2024.^[1]

2021: Sugar production in Russia increased by 430 thousand tons, to 5.33 million tons

At the end of 2021, 430 thousand tons of beet sugar were produced in Russia more than a year earlier. This is evidenced by the data of the analytical service of Soyuzrossahar, disclosed on January 11, 2022. By this date, sugar production in the country from beets of the 2021 crop reached 5.33 million tons.

By the end of 2021, 10 sugar factories located in the Central, Volga Federal Districts and Altai Territory were operating in the Russian Federation. In connection with the end of processing of the harvested sugar beet crop in 2021, work was stopped at 56 sugar factories.

Sugar production in Russia increased by 430 thousand tons, to 5.33 million tons

The sugar beet harvest, according to Rosstat, in 2021 amounted to 38.7 million tons against 33.9 million tons in 2020. According to the presentation of Soyuzrossahar, sugar beets in 2021 were sown by 1.006 million hectares against 928 thousand hectares in 2020, its yield increased to 380 c/ha from 370 c/ha. The decline in production was largely influenced by drought.

According to RBC, citing Rosstat data, record inflation in 2021 almost did not affect sugar prices - over the year it rose in price by only 4%. Price agreements with sellers, tariff regulation and a good harvest held back the cost.

The government is monitoring prices for sugar and sunflower oil after Russian President Vladimir Putin drew attention to a sharp rise in prices for these products in December 2020. On behalf of the head of state, officials prepared measures regulating the industry: the Ministry of Agriculture, the Ministry of Industry and Trade, manufacturers and retail chains signed agreements setting marginal prices for sharply increased prices for goods.

The agreements provided that manufacturers should release granulated sugar from factories no more than 36 rubles per 1 kg, and in stores it should also be no more than 46 rubles. However, by December 2021, 1 kg of sugar in Russian stores cost an average of 54.6 rubles against 52.4 rubles in the same month a year earlier, the newspaper notes.^[2]

2020: Russia has record low sugar prices due to overproduction

The price of sugar in Russia has decreased by more than 1.5 times. In 2016, the wholesale price of sugar exceeded 35 rubles/kg, as of February 2020, it is at a historically low level of 20 rubles/kg.

According to the results of the 2016/17 agricultural season, sugar production exceeded domestic consumption, producers did not find demand on world markets either.

Due to this situation, three plants are closed:

1. Meleuzovsky sugar factory in Bashkiria (part of the Prodimex group);

2. Nurlat sugar factory in Tatarstan (part of the local Agro-invest group);

3. Tovarkovsky sugar factory (owned by the structure of Rosselkhozbank) in the Tula region.

2017: Russia prepares to seize sugar market share

According to the results of the agricultural year from August 2016 to July 2017, Russia intends to increase sugar exports by 25 times from 8 thousand to 200 thousand tons, said Russian Minister of Agriculture Alexander Tkachev.

"We predict that about 200 thousand tons of sugar will be exported at the end of the season," said the head of the Ministry of Agriculture. - For comparison: according to the results of the previous year, Russia sold 8 thousand tons of sugar, that is, an increase of ten times! This opens up great opportunities not only for agriculture, but also for the dynamic development of the economy as a whole, "the minister is sure

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