Astarta spurs hopes for Ukraine sugar output jump


Ukraine looked on track for its first sugar surplus in five years, after top producer Astarta, terming its early beet harvest of the "highest level", said it was on track to lift by 75% output of the sweetener.

Astarta said that the average beet weights, from a harvest which began late last month, were coming in 10% higher than last year, when Ukraine was hit by the same drought which, in neighbouring Russia, was the worst on record.

The group signalled higher sugar content in the beet too in terming the crop’s "quantitative and qualitative characteristics" as being "on the highest level".

Indeed, results on weight and growth in sugar content "significantly exceeds" those of previous years. In 2010, Astarta’s sugar extraction rate fell, thanks to the impact of dry weather, to 12.7% of beet weight, from 14.8% in 2009.

The national figure fell to 11.8% from 13.5%.

Rising production

Astarta added that it was maintaining guidance of 350,000 tonnes of sugar output this year, lifted by a 13% rise to 43,000 hectares in beet sowings and a move into cane processing besides the improved quality of the domestic crop.

The group has produced some 30,000 tonnes of sugar from cane since opening a processing plant in June.

The results from Ukraine’s top sugar producer underpin hopes that the country’s sugar output will beat consumption of about 2m tonnes for the first time since 2006. Last year’s drought cut production to 1.55m tonnes.

While Ukraine in Soviet times produced some 5m tonnes of sugar, output has fallen thanks to growth in production of lower-cost cane sugar, and a switch by growers into crops, such as sunflowers, which have tended to produce higher returns.

Ukraine forecasts

Ukraine’s farm ministry has targeted production of 2.2m tonnes, while Ukrtsukor, the national sugar union, has pegged output at 2.1m tonnes.

Last week, the International Sugar Organization forecast Ukrainian sugar output "well in excess of" 2m tonnes in 2011-12, supported by a 10% increase in beet area and "good weather".

Many other beet-producing nations are expecting higher crops too, including Russia, where better conditions could see jump to more than 5m tonnes from 2.7m tonnes in 2011-12, the ISO said.

Astarta shares, which are listed in Warsaw, stood 2.0% lower at 72.00 zloty in afternoon trade.–3566.html?

Astarta’s sugar gamble appears to have paid off

tải xuống (11) Ukraine’s largest sugar producer, Astarta, appears to have made a right call on sugar prices by holding off on sales in the spring, in the expectation of higher summer values.

Astarta revealed that its sugar revenues rose 4%, year on year, to E78m in the first half of 2011 – lagging a 13% rise in Ukrainian prices of the sweetener.

However, the shortfall was down to a decline in sales volumes, of 12%, rather than a bad call on prices, as the company withheld sugar in the hope of tapping higher prices later on.

Group sugar inventories ended the quarter 19% higher than a year before, "providing good potential to benefit from a favourable pricing environment in the summer months, when demand for sugar from soft drink producers is higher", said Astarta, whose major customers comprise confectionery and drinks makers.

The gamble appears to have paid off, to judge by raw sugar futures which, in New York, rose 1.5% to 31.25 cents a pound on Tuesday, for the near-term October contract.

New York’s spot sugar contract averaged about 27.50 cents a pound in the first half of the year.

‘Optimal prices’

The comments came as the group unveiled a 39% rise to E56.7m in half-year earnings on revenues up 16.9% at E116.1m.

The revenue increase was spearheaded by a 72% jump, to E27m, in takings from crop sales, on higher volumes and prices, with Astarta also holding some sales of grains until late in the half, allowing them to benefit from "optimal prices" after the government lifted export restrictions.

Ukraine from May began lifting export quotas imposed after a drought-sapped harvest last year, although a levy regime imposed as a replacement has proved controversial, and been blamed for a slide in shipments last month.

Astarta’s revenues from its dairy operations grew 35% to E11m, boosted by 20% expansion to 13,000 head in herd numbers, besides an increase in productivity.

Astarta shares, which are listed in Warsaw, closed up 2.6% at 78.00 zloty.–3509.html