January 13 2004, 16:50

Russia will cut away illegal imports of sugar

The Ministry of Agriculture, jointly with Russian Union of Sugar Producers, will take to elaboration of a series of measures to restrict illegal imports of sugar to the country, AK&M agency informed. The corresponding order has been given to the ministry by the governmental commission on the issues of consumer market, the Head of the Commission Aleksey Gordeyev (the Minister of Agriculture) has informed.

The Ministry for Economic Development is to elaborate a comprehensive set of proposals to combat the illegal sugar imports, taking into account the opinions of different ministries and representatives of sugar industry. According to Gordeyev, the necessity of elaboration of such measure has arisen, in particular, by increased imports of white sugar and cane-origin raw sugar, which often bypass the norms of customs and tariffs regulation, established by Russian government.

According to data of the Head of Russian Sugar Producers' Union Yuri Mikhaylov, in 2002 import of sugar from Belarus constituted 313,000 tonnes, while local production of sugar in this country amounts of 150,000 tonnes per year, which testifies of Belarus' having become a "transhipment point" to bring raw sugar to Russia from the third countries under the duty-free procedure. On the results of 11 months of 2003 the import of raw sugar from Belarus constituted 277,000 tonnes. The amount of import in 2003 is expected to exceed the values of the previous year. According to State Statistics Committee, supplies of white sugar from Belarus to Russia in 2001 constituted 270,000 tonnes, while in 2002 they made already 477,000 tonnes.

Also, supplies of white sugar from Kazakhstan have stepped up. The amount, imported over the 11 months of 2003, was 60,000 tonnes, while over the whole 2002 the import from this country had constituted just 500 tonnes.

There is also a possibility for unregulated import of sugar to Russia through the territory of Georgia, since this country has not yet ratified the agreement about the customs union and the accompanying list of exceptions. This circumstance, in particular, is used by Ukrainian suppliers of sugar, who bring it through Russian-Georgian border without any duty payments.

The suppliers from Moldova are also looking for ways to bring the product into Russia, bypassing the norms of customs and tariff regulation.

According to State Customs Committee, about two thirds of the sugar, present in Russian sugar market, is brought to the country as smuggles or through CIS countries, coming around the regulation norms. In 2003 about 500,000 tonnes of sugar were smuggled into the country, another 500,000 tonnes were imported in the form of sugar syrup. And just about 490,000 tonnes were imported under legal procedure. Accordingly, Russian companies, which import the sugar to the country by legal way encounter losses, which, according to Russian Sugar Producers' Union, amount to $50 to 80 per tonne of the product.

Another was of getting around the regulation norms, set by Russian government, is imports of sugar in the form of syrup, Mikhaylov said. In 2001 the amount of syrup, imported to the country was 10,000 tonnes, in 2002 - 194,000 tonnes, and according to the data as of late December 2003 - already 500,000 tonnes.

Gordeyev also said that along with elaboration of the complex of measures, he was ready to direct appeals to the governments of Belarus and Kazakhstan, pointing to the concrete facts of breaches of Russian sugar import legislation by local companies, in order that Belarusian and Kazakh executive authorities also sort out the things with the lawbreakers.