23 Nov 2019 18:48

Gordeyev backs idea of sugar export contracts, sees Central Asia as promising market

MOSCOW. Nov 23 (Interfax) - Russian Deputy Prime Minister Alexei Gordeyev has supported the idea of sugar exporters' agreements.

The proposal was put forward by the Federal Anti-monopoly Service (FAS).

"This is the right initiative. It is clear that sugar producers' agreements would make them look more mightily on export markets," Gordeyev told journalists during the 19th United Russia party congress on Saturday.

Central Asia promises to be the biggest market for Russia, he said. "We are pinning big hopes on our partners and on being able to offer terms no worse than those for raw-sugar purchase. But work on this is under way," Gordeyev said.

It was reported that the FAS had drafted a government directive that would allow white or beet sugar producers to export jointly. The export boost is needed to normalize the sugar market and stabilize the prices situation. The overproduction of sugar and a sharp drop in prices have hit hard many sugar factories. Several could go bankrupt, the FAS said.

The agency reckons that the combined output of companies, which could sign such agreements, should account for at least 70% of Russia's sugar production. The proposal was supported by the Agriculture Ministry.

According to the Sugar Producers' Union (SoyuzRosSakhar), Russia's beet sugar output has exceeded consumption since 2016, resulting in a surplus of sugar products. This year the country's beet sugar output could reach a record 7.2 million tonnes, well above the annual consumption of 5.8-5.9 million tonnes.