Indian sugar arrives to supplement market

The first batch of 200,000 metric tons of sugar to stabilize the market arrived at port of Djibouti.
The sweet, which severs as an input  for some of industries, has been aggressively imported in the past budget year while new sugar factories are undergoing construction  and some of the existing ones delayed production due to political instability.
The sugar was purchased late last year to help stabilize the market while  sugar factories are undergoing maintenance was awarded by the Sugar Corporation, who is the sole producer and buyer of sugar.
Initially the company from Nigeria Feoni Consortium Limited won the bid to supply  sugar at the rate of USD 414 per ton with CIF Djibouti, but the company disappeared and was unable to settle the 10 percent bid bond.
Accordingly the Corporation has awarded the supply to the second winner to supply sugar at the rate that Feoni Consortium Limited offered. Agrocorp International, a Singaporean company, has agreed to deliver the product.
According to the information that Capital obtained from the Sugar Corp., the first batch, which is 25,000 metric tons of sugar, transported via Ethiopian Shipping and Logistics Services Enterprise has arrived at Djibouti. The product will be fully transported until December this year.
Sources said that the product was purchased in India.
So far the corporation has not stated that it has a plan to buy more sugar this budget year.
Recently, Prime Minister Abiy Ahmed (PhD) stated that some of the delayed sugar plants will commence production within six months. Sources said that Omo Kuraz III, which is one of the new factories constructed by the Chinese company COMPLANT, is one of the factories that would be operational in the near future. COMPLANT has also finalized the projects at Omo Kuraz II and Kessem.
The maximum production in the history of the corporation was 4 million quintals per annum in the 2015/16 budget year. Two years ago the annual production was 4.5 million quintals. According to the survey conducted by the Sugar Corporation the current demand is from 6 to 6.5 million quintals per annum.
Due to the gap between the demand and actual local production the corporation has imported 200,000 metric tons of sugar per annum, while last budget year imports significantly increased.
The sugar shortage is not new to the country. For the past several years the government has allocated millions of USD to import the sweet.
In the beginning of the past Growth and Transformation Plan (GTP I), which started in 2010 and ended in 2015, the government announced the commencement of ten sugar factory projects that were expected to be finalized before the end of the five year period. Hopes are that the new sugar factories will allow the country to halt sugar imports and enable it to earn more than USD 600 million from exports by the end of the first GTP.
However almost all of them have been delayed beyond the scheduled time and the country continues to allocate scarce hard currency to import the product, which is also source of input for several industries. Every month the corporation supplies 600,000 quintals of sugar to the local market and manufacturing industry.
In the beginning of the past Growth and Transformation Plan (GTP I), which started in 2010 and ended in 2015, the government announced the commencement of ten sugar factory projects that were expected to be finalized before the end of the five year period. Hopes are that the new sugar factories will allow the country to halt sugar imports and enable it to earn more than USD 600 million from exports by the end of the first GTP.
However almost all of them have been delayed beyond the scheduled time and the country continues to allocate scarce hard currency to import the product, which is also source of input for several industries. Every month the corporation supplies 600,000 million quintals of sugar to the local market and manufacturing industry.