New measures to keep the prices of sugar steady The government is discussing new measures to regulate the price of sugar, since the agreement for fixed sugar prices ends on June 1.
New measures include the creation of an intervention fund with sugar reserves for sale, at times of price increases, and the permission of sugar factories to supply retail products. Quotas for duty-free imports are also being reviewed, according to Russian Deputy Agriculture Minister Oksana Lut.
“The current situation on the sugar market is assessed as stable,” the ministry said, adding that the further maintenance of stable sugar prices will be facilitated through a quota on sugar imports with a reduced duty rate. As a result, the beet harvest this year will amount to at least 40 million tons, “which will make it possible to obtain about 6 million tons of sugar. This volume will be enough to meet the needs of the domestic market and form carryover stocks.”
Inflation in 2020 in Russia was the highest in 4 years – 4.9%, according to Rosstat. Granulated sugar became the leader in consumer price growth – by 64.54% at once. Sunflower oil rose in price by 25.91% over the year. The Ministry of Agriculture told Kommersant that they consider it reasonable to create a supply of sugar for uninterrupted supplies and stable prices.
In March 2021, the government extended the validity of agreements on price stabilization after April 1: for granulated sugar until June 1, for sunflower oil – until October 1, 2021. Food producers, the Ministry of Industry and Trade, the Ministry of Agriculture, and large retailers signed an agreement on price stabilization on December 16, 2020.
The agreements fix the cost of 1 kilogram of sugar at a level not exceeding 36 rubles for wholesalers and 46 rubles for retail buyers, 1 liter of oil at 95 and 110 rubles, respectively. Simultaneously with the extension of the price freeze, the government introduced measures to support business.
So, from April 1, sugar factories can receive from the state 5 rubles for each kilogram of sugar, which is sold specifically to retail chains – not to dealers at a fixed price, at 36 rubles per 1 kg. Producers of bottled oil were offered a subsidy at the rate of 10 rubles per 1 liter under the same condition: that the selling price does not exceed 95 rubles.