The big yield of sugar beets in Ukraine and increase of cultivated areas under this crop created all the conditions for the cost of sugar to go down.
However, the rise in price of gas, which makes up to 70% of the cost of production, ruined these forecasts, reports “ProAgro Group” referring to “Vremya”.
“As of today, 28 sugar refineries are operating in Ukraine and more than 400 thousand tons of sugar have already been produced. Initially, 34 plants were supposed to start up, but four have already officially refused to start the sugar season. Because the cost of gas has risen so much that it has become unprofitable to work at a loss”, – said Yuriy Ilchenko, CEO of the Association “Kharkivsugar”.
Out of 34 sugar factories in Ukraine, 19 of them work only on gas. At the same time, the cost of natural gas has increased to a level that makes no economic sense for factories to open this year.
According to Yuriy Ilchenko, if last year the gas price was 7-8 UAH per cubic meter, this year it is 28 UAH per cubic meter. This has become an economic catastrophe for many enterprises of the industry.
