Difficulties in the export of sugar began in Ukraine

Domestic prices for Ukrainian sugar continue to fall due to trade restrictions with the EU. Because of this, wholesale prices from sugar factories may drop to UAH 18-19 per kg. At the same time, according to experts, due to trade restrictions with the EU, which will last until 2025, Ukraine is facing difficulties in exporting sugar. It is because of this that there was a surplus of products in the domestic market.

As noted by a number of mass media, attempts to establish exports to Turkey, Macedonia and other countries do not allow to significantly unload stocks in warehouses. Analysts predict that this trend is likely to continue in the coming months. Because of this, some factories in Ukraine have already started to reduce prices from the previous 21.50-22 hryvnias per kg to 21 hryvnias per kg. In September-October, prices may fall even more due to oversaturation of the domestic market.

It is worth noting that the world sugar market is currently showing a significant increase in prices due to a number of factors. Among the key reasons are the significant drought in Brazil and large-scale fires that damaged 5 to 8% of the cultivated area. This led to a significant increase in the price of sugar on world exchanges.

As previously reported, Ukraine can export $158 million worth of sugar to the EU. Sugar producers are negotiating the division of the quota for duty-free exports of their products to the European Union. The EU market is a premium for sugar producers — prices on it can be up to 15% higher than world prices. Given the expected annual quota of 262.6 thousand tons in 2025 and average exchange quotations of $603/ton, we are talking about a market of $158 million.

We would like to remind you that within the framework of the Association Agreement with the EU, Ukraine can export a certain amount of agricultural products to EU countries at a zero customs rate. The quota for duty-free supply is much smaller than the amount of goods that Ukrainian manufacturers are ready to supply. Because of this, the annual quota is sometimes "closed" in a few days. In 2025, Ukraine will be able to export 262.6 thousand tons of sugar according to the quota, as in 2024. Since sugar producers are deprived of the right to export products to the EU until the end of the year, the industry is already preparing tools for self-regulation.