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Petros Gemintzis, Director, Hellenic Sugar

Setting The Bar Even Higher

Low sugar prices on our domestic market also hit the industry, but Hellenic Sugar in Serbia survived those extremely difficult times and, for the second consecutive year, is increasing its production and looking forward to reaching full capacity in 2022 and 2023

We are now setting the bar even higher, as the rebalance of sugar production in the EU has led to Serbia becoming the biggest sugar producer in the whole of Southeast Europe, with significant exports to the region, explains Hellenic Sugar Director Petro Gemintzis in this interview.

Since 2017, when the EU abolished its sugar quotas, there has been overproduction, falling prices and the closure of many sugar mills. What has changed on the market in the meantime?

– The EU’s policy of abolishing quotas for sugar production among member states caused turbulence on the European markets, both inside and outside the Union, particularly in Serbia. Production of sugar in Serbia has been declining since 2017, with prices falling drastically, by up to 50%, the area under beets is decreasing, while sugar beet prices remain high.

Until 2017, sugar beet was cultivated on an area of about 60,000 hectares, but that area has decreased to below 40,000ha in the last two years. Higher production and lower sugar prices in the EU have also led to the reduction of our exports to both EU and CEFTA countries, due to strong competition and dumping prices. Low sugar prices on our domestic market also hit the industry. In order for the sugar industry to recover, the area under sugar beets needs to increase to at least 50,000ha, while sugar prices need to recover significantly to previous levels, primarily on the domestic market. Hellenic Sugar in Serbia has survived these extremely difficult times.

We see an opportunity to activate our mill in Žabalj in 2022, to invest more, modernise and deal with a lot of challenges

Can you finally be satisfied with the results recorded by Crvenka? And what is happening with the sugar mill in Žabalj?

– The ongoing COVID-19 pandemic has had a huge impact on the global economy, and we are fortunate that the “Crvenka” sugar mill was able to contribute during these challenging times. Not only have we achieved higher production of sugar, but also of its by-products – molasses and beet pulp – from which yeast and alcohol are produced. We were therefore able to respond to the sudden spike in demand for alcohol sanitizers at the right time, which again underlined the importance of the sugar industry.

We are aware of the negative effects that lower sugar prices have had on the global market and that many mills in Europe have closed, including in neighbouring Croatia. However, we see an opportunity to activate our mill in Žabalj in 2022, to invest more, modernise and deal with a lot of challenges, especially environmental ones. We will respond to those challenges with new investments in saving water and energy, and making our production more eco-friendly.

Serbia has huge potential when it comes to agricultural production and the processing of agricultural products. Is this our biggest trump card and the area of the economy in which the most needs to be invested?

– World market prices for major food commodities like grains and vegetable oils rose significantly during the last year, which is a solid indicator of the importance of agricultural markets worldwide. Therefore, Serbia should utilise its potential and invest more in agriculture, and we are willing to help in achieving that. We clearly see this opportunity and that’s why Hellenic Sugar has invested in production facilities in Serbia. We are now setting the bar even higher, as the rebalance of sugar production in the EU has led to Serbia becoming the biggest sugar producer in the whole of Southeast Europe, with significant exports to the region. A challenge still lies ahead, since our current production remains beneath the level of demand and we are determined to invest further in this direction.

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