The nation’s sugar industry has seen a transformation in recent decades, switching from being a huge importer of raw sugar to having excess supply to offload. Yet Russia struggles to compete in the export market because it isn’t as efficient at processing as other countries, meaning its costs are higher. The increased storage expense also comes at a time when margins are being squeezed by low sugar prices.

 

Russian sugar output is estimated to total 7.2 million tons this season and exports may only reach 1 million tons, mostly to nearby countries, said Bodin, whose union represents 95% of Russia’s producers. That’s causing a storage shortfall of about 2 million tons, he said.

 

Looking ahead to next season, Russian sugar production will probably fall as low domestic prices discourage beet plantings, Bodin said, without specifying the amount.