In recent months, the price of sugar has been steadily climbing up the steps of the price ladder. What is the reason: pandemic, crop failure, shortage or trend? I was looking for the reasons Alexander Korotynsky, director of the Scientific and Practical Center for Beet and Sugar Production.

So, the prices for the last months:

• 17.3 thousand UAH / t with VAT or $ 607.1 as of December 1, 2020;
• 18.2 thousand UAH / t with VAT or $ 643 as of January 4, 2021;
• 20 thousand UAH / t with VAT or $ 677.1 as of January 22, 2021

(all prices in this overview are indicated with VAT, terms of shipment - ex-works).

Sugar prices continued to rise throughout the production period, although they generally declined during this period. Why is it the other way around in 2020? COVID Affected?

Let's look at the reasons for what happened. Let's start with how much sugar we need for 1 year. Consider the sugar balance in Ukraine over the past few years.

* The sugar balance in Ukraine was developed by the specialists of the Scientific and Practical Center for Beet Sugar Production and may differ from official sources. The balance was developed on the basis of our own sources of information and is only the opinion of our organization.

According to the information provided, each MG (ends on August 31) at the end of the period in the country remains within 250 thousand tons of sugar. Due to the decline in sugar beet yields and the low sugar yield, “record” low volumes were produced this season. According to our calculations, 1.19 million tons of sugar were produced in the country in 2020/21 MY, with 1.38 million tons consumed.

For the period from September 1 to December 31, 2020, Ukraine has already exported almost 70 thousand tons of sugar, which further reduced the availability of sugar on the market. If the export reaches the projected 100 thousand tons of sugar, then at the end of summer 2021 there will be no sugar left in the country and it will be urgently necessary to import it. As you can see, there are no prospects for a decrease in sugar prices yet.

Let's take a look at the global sugar and raw sugar price environment.

If we take April 2020 as a basis (100%), then we have an increase in prices in January 2021 to the basis,%:

• Ukraine (white sugar) - 57.3%
• London Stock Exchange (white sugar) - 33.7%
• New York (raw cane sugar) - 58.9%

According to the given data, we see that the rise in prices is taking place not only in Ukraine. World markets are also growing. Therefore, it can be assumed that domestic prices began to rise as a global trend for the rise in sugar prices.

Alexander Korotynsky, Director of the Scientific and Practical Center for Sugar Beet Production

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