Top sugar buyer Russia will consume less of the sweetener in 2005, as rising incomes mean Russians make less moonshine liquor and fruit jams at home, while the population keeps dwindling, analysts said on Monday. A report by the Institute for Agricultural Market Studies (IKAR) said the country's sugar consumption would fall to 5.75 million tonnes in 2005 from 5.95 million tonnes in 2004 and 6.03 million in 2003.
"Volumes of home-made alcohol and jams are declining, as the population can afford buying more industrially made products ... where sugar consumption is lower," Dmitry Rylko, IKAR's general director told Reuters.
"Another reason, which we must not forget about is that the population numbers have been falling by an average of 0.5 percent a year in the last few years."
Currently Russia's population is estimated at 145 million.
The report estimates that raw cane sugar imports in 2005 will not exceed 2.5 million tonnes, close to 2004's volume.
"And this is a rather optimistic forecast... Prospects of profitability of raw sugar processing (in 2005) raise certain doubts," Rylko said.
Russia used to refine the bulk of sugar it consumes from imported raw cane sugar and a much smaller portion from domestic sugar beets.
Following the introduction of a floating import tariff on raw sugar from 2004, imports declined to 2.47 million tonnes last year from 4.12 million in 2003.
The share of white sugar refined from raws decreased to 45.3 percent of total supply in 2004 from 55.1 percent in 2003, while the share of sugar refined from domestic beets rose to 39.8 percent from 28.9 percent the report said.