Ukrainian Sugar Production Doubles Over 2011

Kyiv, December 27, 2011. National Association Ukrtsukor (UkrSugar) reports that Ukrainian sugar manufacturing industry produced 50.5 percent more sugar in 2011 compared to 2010. The increased production volume resulted in the surge of Ukraine’s sugar export – the numbers grew by 92.5 percent in 2011 compared to the previous year, according to the Ukrainian Agrarian Business Club.

In 2010 only 15 sugar manufacturing plants functioned in Ukraine while this year this number has increased to 25, stated the National Association Ukrtsukor. Due to the production boost Ukraine currently exports 4 thousand tons of sugar per year. Ukrainian companies supply sugar to Georgia and Slovakia. Last year Ukrainian sugar plants produced almost 22 percent more sugar compared to 2009.

“The present state of the domestic market surplus conditions the necessity of constant opening of new markets for maintaining commercial viability of the industry,” said agrarian markets expert for the Ukrainian Agrarian Business Club Taras Vysotskyi. The predictions by the Ministry of Agrarian Policy and Food of Ukraine did not forecast such a production boost. The Ministry recently warned about the possible market surplus.

Experts estimate the surplus of sugar in Ukraine at 300 thousand tons. This allows for the remarkable potential for export. As of now, Ukraine aims to reintroduce sugar export to Russia and find new customers for its sugar. One of the Ukrainian sugar plants informed about its preliminary arrangements to supply sugar to the United Arab Emirates in October 2011.

Sugar industry is historically developed in Ukraine. The climate in the country allows for easy production of beet root. Consequently, 19 of 25 regions of Ukraine produce sugar. West-Central region (Vinnytsia oblast) is the leader of the Ukrainian sugar industry. The first two sugar plants were built in Ukraine in 1824. For the next century sugar, along with grain, had become an important export product for Ukraine.

Additionally, the European Bank for Reconstruction and Development supports sugar industry in Ukraine. The USD 20 million worth project Astarta aims to help achieve higher energy efficiency at Ukraine’s sugar production plants. Energy savings due to the introduction of the project are set to reach 30 percent of the current energy consumption. This would improve productivity and reduce costs of sugar production while bringing Ukraine closer to EU standards, according to the EBRD.