BRAZILIAN SUGAR TO CENTRAL ASIA

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Grandes quantidades de açúcar brasileiro estão indo para a Ásia Central. Cazaquistão, Uzbequistão, Turcomenistão, Tajiquistão e Quirguistão. Estes países podem sofrer com a solução do produto se a guerra entre a Ucrânia e a Rússia continuar nos próximos meses.

Famine threatens Central Asia as the war in Ukraine unfolds.

On March 16 this year, Kazakhstan’s President Kassym-Jomart Tokayev delivered his annual State of the Nation address in Nur Sultan, the country’s capital. Most of Tokayev’s speech dealt with political reforms carried out in Kazakhstan or that he plans to carry out, after promising them in response to political unrest and the January protests against the Kazakh government. He also addressed the impact of the Russian-Ukrainian war on Kazakhstan, and pointed to rising food prices and currency volatility as some of the troubling economic consequences facing the country as a result of this conflict.

Tokayev’s remarks came four days before the Noruz holiday, an annual festival celebrated by people in the belt stretching from Kurdish lands to Kyrgyzstan, which fell on March 20. Homes across Kazakhstan were gearing up for the celebration, despite the fact that food price inflation – which predated Russian intervention in Ukraine and the resulting Western sanctions imposed on the Kremlin – had already dampened the mood for the country’s festivities. ; in mid-March, the National Bank of Kazakhstan reported that prices for food products such as baked goods, cereals, vegetables and dairy – important components of a Noruz meal – had increased by 10%.

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HUNGER AND MISERY

Tokayev spent part of his speech dealing with inflation in energy and food prices. He spoke about the need for the government to supervise the production of agricultural equipment, fertilizers, fuel and seed stocks. Tokayev’s statements are nothing new. Other government leaders in Central Asia have also expressed the need for their governments to enter the food production arena, as both the Covid-19 lockdowns and the ongoing Russian war in Ukraine have demonstrated the enormous vulnerabilities of the global food chain, exacerbated by privatization. of food production.

Food prices in the Eurasian Economic Union (EAEU) – which includes Armenia, Belarus, Kazakhstan, Kyrgyzstan and Russia – continue to rise as a result of the Russian-Ukrainian conflict, outpacing world food prices. “Heavily dependent on imports from Russia”, these countries now face a temporary ban on Russian wheat and sugar exports due to the conflict.

On March 11, the UN World Food Program (WFP) published a report dealing with the “Implications of the conflict in Ukraine for food security”. The conflict, says WFP, “comes at a time of unprecedented humanitarian need, as a ring of fire encircles the earth with climate shocks, and conflict, Covid-19 and inflation drive millions closer to starvation. ”. Russia and Ukraine “supply 30% of the wheat and 20% of the corn from global markets,” according to the report, and these two countries also account for ¾ of the global supply of sunflower and ⅓ of barley. Meanwhile, Black Sea ports have largely been inactive since Russia blocked exports from these points in the wake of the war. This caused “[an] estimated 13.5 million tons of wheat and 16 million tons of corn” to be “frozen in these two countries”, as these grains cannot be transported outside the region.

Full article by By Vijay Prashad | Globetrotter – Translation by Pedro Marin for Revista Opera, available at: https://revistaopera.com.br/2022/03/29/a-fome-ameaca-a-asia-central-enquanto-a-guerra-na- ukraine unfolds/

BRAZILIAN SUGAR IMPORT IN CENTRAL ASIA

“Central Asia, in this case, will be the focus of analysis. This subcontinent is made up of five countries: Kazakhstan, Uzbekistan, Turkmenistan, Tajikistan and Kyrgyzstan. Together, they make up an area of 4 million km2, with Kazakhstan being the largest in space territorial, as it covers 2.7 million km2.”

The war in Ukraine had a series of consequences around the world. The supply of grains, fertilizers and wheat impacted all countries that are not self-sufficient in the production of these inputs.

Sugar is one of them.

In order to protect their markets from food inflation and possible shortages, sugar producing and exporting countries have suspended or restricted exports.

Russia banned sugar exports from March to August/2022

Zeroed the tax for the Import of 300 thousand tons of sugar and raw sugar

In March, Algeria was expressly banned from exporting products in which the country is not self-sufficient, including Sugar and Wheat

In April, the government of Belarus imposed an export ban on salt, sugar and other food products due to high demand in border areas

In May Malawi, Kazakhstan and Pakistan suspend sugar exports to neighboring countries

India restricted sugar exports from June 1 to October 31, 2022

Protectionism directed the demands for sugar to Brazil. As of May, Mello Commodity began to receive strong demand for sugar with destinations in Central Asia.

The main demands are directed to landing in Georgia and Pakistan. Since the Caspian Sea is not directly accessed and has navigability problems.

Demand is welcome, and sugar exporters are pleased to be able to bring high-quality sugar to destinations that previously did not have such significant demand for the Brazilian sweetener.

The problem is that Brazil has also been facing problems that arose with the covid-19 pandemic and the beginning of the war in Ukraine. These two global problems have resulted in two difficulties for sugar exporters, they are:

LACK OF CONTAINER IN BRAZIL

The pandemic and measures of social isolation and demand for medicines and medical supplies changed logistical flows and Brazil was heavily impacted. Containers were dammed up in several world ports and this resulted in a shortage of containers in Brazil.

Scarcity generated an increase in the cost of leasing and shipping that impacted the supply of sugar in this modality.

CANCELLATION OF SUGAR SUPPLY CONTRACTS

The war in Ukraine impacted fuel prices around the world, in Brazil it couldn’t be different.

Ethanol became more valued than sugar. More profitable, faster sale domestically, payment received within two business days. These factors motivated many sugarcane mills to produce more ethanol than sugar. Some preferred to pay the fine and cancel sugar supply contracts, direct production to Ethanol, and boost industries’ cash.

In Brazil, 80% of sugarcane mills have a hybrid structure and are able to produce both sugar and ethanol. This competitive advantage makes them direct production towards the most profitable product.

Don’t worry. A good part of the mills maintained sugar exports.

BRAZILIAN SUGAR TO CENTRAL ASIA

If you have read this far, you have found that the world supply of sugar has shrunk due to protectionist measures by producing countries and demand for Brazil has increased at a time when internal factors also repress the supply of sugar.

The good news is that Brazil is the largest sugar producer in the world and has no plans to establish protectionist measures to further restrict supply. The best news so far is that you are on the best site to buy sugar in Brazil.

Mello Commodity manages the supply of 3 major sugar suppliers.

Two suppliers are located in Brazil and one in Abu Dhabi. All of them have sugar quotas in Brazil, an excellent financial structure, logistical and operational support, as well as consolidated experience in sugar exports.

It will be a pleasure to serve Central Asia with the sugar produced in Brazil.

In order to receive a quote your company needs to meet some requirements, they are:

1 – Have an active import license for Central Asian countries

2 – Have experience with importing commodities

3 – Be able to issue SBLC or DLC financial instruments through one of the 50 largest banks in the world

If your company meets these three requirements, request a quote.