icumsa – MBF Group

The white beet sugar market in Poland and Europe has experienced significant fluctuations. The armed conflict in Ukraine, a follow-up to Russia’s February 2022 invasion, has had a significant impact on the global sugar market, leading to disruptions in sugar production and exports. The increase in energy prices has further burdened the cost of sugar production, affecting its final price. Stable but slightly increased demand for sugar, mainly from the food and beverage industry, has put additional pressure on the market. At the same time, sugar production in Poland and Europe did not reach last year’s levels, due to unfavorable weather conditions and rising raw material prices.

Important events and factors affecting prices, imports and exports

The flow of Ukrainian sugar into the European market has been limited by the ongoing hostilities, but despite this, some quantities of Ukrainian sugar have fed into the market, affecting price stability. In the second half of 2024, the outlook for the sugar market remains uncertain, dependent on a number of variables, including the further course of the war in Ukraine, the development of energy prices, weather conditions and sugar demand. Despite the current challenges, the sugar market may experience further price fluctuations, as well as changes in import and export levels, depending on geopolitical and economic developments in Europe.

War in Ukraine

Ukraine is one of the largest producers and exporters of sugar in the world. In 2021, it produced about 20 million tons of sugar, of which 14.5 million tons were exported. Russia’s invasion of Ukraine in February 2022 had a significant impact on the global sugar market. Ukraine is one of the world’s largest sugar exporters, and the war has led to disruptions in production and exports. This caused an increase in sugar prices on world markets, which also affected prices in Poland and Europe.

Increase in energy prices

Energy prices rose significantly in the first half of 2024, affecting sugar production costs. Sugar beets require a lot of energy to process into sugar, and higher energy prices have led to higher production costs.Sugar production from sugar beets is an energy-intensive process that involves a number of energy-intensive steps, such as beet juice extraction, cleaning, juice concentration and sugar crystallization. The increase in energy prices led to higher costs at each of these stages, which ultimately translated into higher sugar production costs.

Increased demand

Demand for sugar in the first half of 2024 was relatively stable. However, a slight increase in demand from some sectors, such as the food and beverage industry, has put pressure on prices. With the rising prices of other foods, such as fruits and vegetables, sugar is becoming a more attractive alternative for many consumers. This is particularly evident in low-income countries, where sugar is often one of the cheaper sources of energy. Although there is a growing interest in healthy foods, there are still many people who enjoy eating sugary and salty products. Sugar is often added to processed foods, increasing its consumption. The popularity of carbonated and energy drinks, which contain large amounts of sugar, also contributes to its demand.

Reduction in production

In the spring of 2023, many countries in Europe experienced droughts that negatively affected the growth of sugar beets. Fertilizer and pesticide prices have risen recently, increasing the cost of sugar production. Sugar production in Poland and Europe in the first half of 2024 was slightly lower than in the same period last year. This was due to a number of factors, including unfavorable weather conditions and rising commodity prices.

Impact of sugar influx from Ukraine

The impact of the influx of sugar from Ukraine into the Polish and European markets in the first half of 2024 was an important factor shaping the price dynamics and availability of this raw material. Ukraine, which is one of the world’s key sugar producers, has found itself in a difficult situation due to the prolonged war with Russia, which began in February 2022. The conflict has caused a number of logistical problems, a reduction in farmland and damage to industrial infrastructure, which has directly reduced Ukraine’s production and export capacity.

Reduced production and logistical disruption

The war has caused major disruptions in Ukraine’s agriculture and processing industries. Farmers have had limited access to key resources such as fertilizer and fuel, and have faced security problems in the areas affected by the military operations. In addition, the destruction of transportation infrastructure, including roads and bridges, made it difficult to transport sugar beets to processing plants and export finished sugar abroad. All of this has caused Ukraine’s sugar production to drop significantly.

Inflow of sugar to Poland and Europe

Despite these challenges, some sugar from Ukraine has found its way to the European market. This was made possible by logistical efforts, including the search for alternative transportation routes and international humanitarian and economic assistance, which helped in part to sustain Ukrainian production and exports. Sugar imports from Ukraine, however, were limited and irregular, making their impact on the European market volatile.

Forecasts for the sugar market in Poland and Europe for the second half of 2024

The white beet sugar market in Poland and Europe faces an uncertain future in the second half of 2024. Much depends on a complex set of factors that can affect prices, imports and exports of this commodity. The main determinants include the course of the war in Ukraine, energy prices, weather conditions and sugar demand. Analysis of these factors will help understand possible scenarios for market development in the coming months.

Sugar prices: stability with possible reductions

Sugar prices in Poland and Europe are expected to remain relatively high. The war in Ukraine, which has a key impact on the sugar market, has caused significant disruptions in the production and export of the commodity, which has affected its supply and price. However, some price reduction is possible if sugar production in Europe increases and sugar inflows from Ukraine increase. Stabilization of the situation in Ukraine could contribute to greater supply and lower price pressure.

Sugar imports: potential for growth

Sugar imports to Poland and Europe in the second half of 2024 may increase, especially if sugar production in Europe is not sufficient to meet demand. High energy prices, which raise production costs, may prompt European producers to reduce production, increasing reliance on imports. Ukraine, despite its difficulties, remains a potential source of additional supplies if the logistical and political obstacles of the war can be overcome.

Sugar exports: possible reduction

Sugar exports from Poland and Europe could decline if sugar prices on world markets fall. European producers may be less inclined to export if domestic prices are more profitable. In addition, reduced production in Europe may reduce the surplus available for export, which will focus on meeting domestic demand.

Factors affecting forecasts

The analysis of market forecasts for sugar in 2024 takes into account several key factors affecting its production, costs and prices. The war in Ukraine represents a significant element of uncertainty that could significantly affect the country’s production and export capacity. Energy prices, which have risen in the first half of 2024, directly affect the cost of processing sugar beets and, consequently, the final price of sugar. In addition, changing weather conditions can affect the quality and quantity of the harvest, introducing another layer of unpredictability. Demand for sugar is affected by both the stability of demand from the food industry and changes in consumer preferences and the development of alternative substitutes. All these elements together shape a complex picture of the sugar market in the coming months.

The course of the war in Ukraine

The war in Ukraine is a major factor in uncertainty in the sugar market. Further developments could significantly affect the country’s sugar production and exports. If the war is prolonged, production and logistics disruptions could worsen, keeping pressure on high prices. In turn, a quick end to the conflict could help stabilize and rebuild Ukraine’s production capacity, boosting sugar exports.

Energy prices

Energy prices are a key factor affecting the cost of sugar production. The increase in energy prices, observed in the first half of 2024, raised the cost of processing sugar beets, which translated into higher sugar prices. If energy prices remain high, production costs could rise further, sustaining high sugar prices. Conversely, a drop in energy prices could bring relief to producers and consumers.

Weather conditions

Weather conditions have a direct impact on the size and quality of the sugar beet harvest. Adverse conditions such as drought, excessive rainfall or low temperatures can lead to reduced yields, which reduces sugar supply and raises prices. Weather forecasts point to volatile conditions in the second half of 2024, adding to the uncertainty of the harvest.

Demand for sugar

Demand for sugar remains stable, with a possible slight increase from the food and beverage industry. The increase in demand could put additional pressure on prices, especially if supply is limited. Changes in consumer preferences, health trends and the development of sugar substitutes can also affect demand dynamics.

Applications

Forecasts for the second half of 2024 indicate a continuation of high sugar prices in Poland and Europe, with possible reductions if the production situation in Europe and Ukraine improves. Sugar imports may increase to meet growing demand, while exports may decline in the face of market uncertainties. Key factors such as the course of the war in Ukraine, energy prices, weather conditions and sugar demand will continue to determine the market’s formation in the coming months. Monitoring these variables is key to understanding and predicting future trends in the sugar market.

Information about the company MBF Group SA

MBF Group SA is a leading company specializing in sugar trading and importing, supplying high-quality sugar products to the Polish and European markets. With years of experience and an extensive network of international contacts, MBF Group SA ensures a stable supply of sugar, even in the face of volatile market conditions.

Our services include:

Sugar Imports: From a wide range of sources, including Ukraine, which allows us to respond flexibly to market needs.
Retail and wholesale: supplying sugar to a variety of customers, from large food corporations to smaller businesses.
Quality Assurance: Guarantee that all our products meet the highest standards of quality and safety.

Why MBF Group SA?

Reliability: Consistent and timely deliveries, even in difficult market conditions.
Competitiveness: Att ractive prices through efficient logistics and resource management.
Experience: Long-standing presence in the market and deep knowledge of the sugar industry.

We invite you to cooperate with us and join the ranks of our satisfied customers. MBF Group SA – your trusted partner in the sugar trade.

Sugar markets remained generally stable in the first quarter of 2024, but have changed in some respects, both globally, in Europe and in Poland. Analysing the latest trends, there are some interesting patterns that are shaping the future of the sector. Global trends in sugar production show a slight increase compared to the previous year, with increased production observed particularly in countries such as India, Brazil and the European Union.

Stable international trade in sugar indicates a continuing balance in global markets, with Brazil, India and the EU continuing to be the main players, and China, India and Indonesia being the largest importers. Sugar prices remained relatively stable at around 20 US cents per pound.

In the European Union, sugar production also increased as a result of favourable weather conditions and an increase in sugar beet acreage. The European Union is exporting more sugar, mainly to Germany, Italy and France, with prices remaining stable, hovering around €500 per tonne.

In Poland, sugar production also increased in the first quarter of 2024, and the country remains a net exporter of sugar, with the main customers in Germany, the Czech Republic and Slovakia. Sugar prices in Poland have remained stable at around PLN 5 per kilogram.

Various factors affect sugar markets, including weather conditions, government policy, reduced consumption and price volatility of other sweeteners such as high fructose corn syrup. The future of the sector will depend on a complex combination of these factors.

Forecasts for the next quarters indicate stability in global sugar production, trade and prices. Despite some changes in production and trade, the outlook for the sugar market remains relatively unchanged, which can provide certainty for investors and suppliers in the coming months.

In summary, the first quarter of 2024 has not seen significant changes in the sugar market, but there are a number of factors that could shape its future. The stability of production, trade and prices gives grounds for optimism, but at the same time it is important to keep an eye on market developments to understand what the long-term effects of these changes may be.

Regarding the immediate future, a general framework of predictions for the next quarters of 2024 can be made based on available data and observations of past trends.

Stability of production: World sugar production is expected to remain relatively stable in the coming quarters. Continued production growth in countries such as India, Brazil and the European Union may result in a continued supply of sugar on world markets.
Sugar trade: International sugar trade is also likely to remain stable. Countries that are traditionally major exporters and importers of sugar will continue their trade patterns, helping to keep markets balanced.
Sugar prices: sugar prices on world markets are likely to remain stable in the next quarters of 2024. Despite some fluctuations due to factors such as weather conditions, government policies or price volatility of other sweeteners, the overall price trend is likely to be rather stable.
Impact of external factors: The impact of external factors such as climate change, trade policy or the health situation should also be taken into account. Nevertheless, if none of these factors change abruptly, the sugar market can be expected to continue its stable path.

It is also worth bearing in mind that the sugar market can be susceptible to unexpected events, so it is important to keep abreast of current information and to analyse possible changes in the global macroeconomic and political situation.

MBF Group SA is constantly adapting to rapidly changing trends in the trading and brokerage industry. Recent events and the information contained in the published ESPI Current Reports show the implementation of the company’s strategy related to the import of food sugar from Ukraine and the prospects for further wholesale and brokerage of sugar.

Current Market Trends

Analysis of current market trends indicates a growing demand for ICUMSA 45 food sugar. Phenomena such as increased health awareness and the popularity of low-sodium diets are fostering demand for higher-quality products, including low-processed white sugar. MBF Group SA, aware of these trends, consistently adjusts its offerings to meet customer expectations.

In the context of the above, let’s trace the key developments and prospects for shareholders and investors that emerged from a series of published stock market reports

1. import strategy from Ukraine: new supply opportunities

The signing of a Trade Agreement for the regular supply of ICUMSA 45 sugar from Ukraine(ESPI Report No. 47/2023) is a significant step for MBF Group SA. Imports from Ukraine, one of the region’s major sugar producers, provide the company with access to a high-quality commodity while hedging against possible fluctuations in prices and available sugar quantities. Import prospects from Ukraine bring new opportunities and can be an asset to investors, increasing stability and diversification of supply.

2. flexibility of framework agreements: responding to increased demand

An additional order for November(ESPI Report No. 53/2023) confirms the flexibility of MBF Group SA’s framework agreements. According to the clause of the Framework Agreement, the company can respond quickly to increased customer demand, which positively affects the total volume of deliveries and generates additional revenue.

3. diversification of sources of supply: From Ukraine and Poland

The company is not only increasing cooperation with Ukraine, but also signing agreements with Polish partners(ESPI Report No. 33/2023 and ESPI No. 50/2023). This is an important decision and a move that contributes to the diversification of supply sources, which is important for minimizing risks and strengthening market positions.

4. prospects for sugar brokering: a new source of revenue

The signing of another Supply Agreement for the benefit of a capital company based in Lublin(ESPI Report No. 50/2023) opens up even more prospects for wholesale sugar trade for MBF Group SA. In doing so, the company can act as an intermediary, which not only generates additional revenue, but also creates new revenue channels.

5. stability of cooperation with contractors: a key element of reputation

The stability of cooperation with contractors from Poland and Ukraine, confirmed by the completion of deliveries and receipt of additional orders, is a key element in building the Issuer’s reputation in the market. We are also making efforts to go out with an offer to supply neighboring countries.

The growth potential for MBF Group SA in sugar imports from Ukraine is very promising over time. If the company takes appropriate action, it could become one of the leading importers of sugar from Ukraine to the European Union.

Opportunities

Growing demand for sugar in the European Union. In recent years, demand for sugar in the European Union has been growing. This is due to, among other things. population growth, increasing affluence and the growing popularity of healthy eating.
Increasing sugar imports from Ukraine to the European Union. Due to the war in Ukraine, the European Union has suspended tariffs on sugar imports from that country. This means that Ukrainian sugar is now more price competitive with sugar produced in the European Union.
The company’s experience in sugar trading. MBF Group SA has experience in sugar trading. The company cooperates with sugar mills in Poland and other countries.

Summary

MBF Group SA’s sugar trading business is growing rapidly, as confirmed by successive stock market reports. The company consistently signs contracts for regular sugar supplies, building stable relationships with contractors. The receipt of additional orders and the flexibility of framework agreements allow us to adapt quickly to changing customer needs, resulting in growing turnover and our company’s reputation in the industry.

The company’s management declares that it will continue to fulfill orders and seek new growth opportunities in the sugar trade sector (including expanding sales to Poland’s neighboring countries). Our company remains in a dynamic growth phase and is ready to meet new challenges and opportunities in wholesale. Further key information on MBF Group SA’s operations will traditionally be provided through stock market reports.

The Management Board of MBF Group SA, with reference to the ESPI Current Report No. 33/2023 dated. June 14, 2023, regarding the signing and commencement of delivery of ICUMSA 45 food sugar, announces the finalization of the entire order. We made deliveries entirely by TIR in 1-ton big-bag packages.

At the same time, we would like to inform you about the ongoing negotiations for the signing of an agreement on long-term sugar supplies. The completed contract was with a Polish company specializing in the production of high-quality cookies and fudge. The company is a major supplier of private label confectionery products to retail chains in Poland and around the world.

In addition, we want to expand the supply of the commodity with a steady supply of ICUMSA 45 sugar, 650 wheat flour, palm fat and glugose syrup. In view of meeting the deadlines for delivery, we do not exclude signing a long-term contract for regular delivery of the above. intermediates.

Wheat flour type 650 bun is an excellent choice for all who appreciate the quality and taste of home baked goods. It is a product that is made from milling wheat grains. An interesting curiosity is that the name “type 650” refers to the mineral content of the flour, which is expressed in milligrams per 100 grams of product. It is this value that determines the characteristic properties of flour, such as color, taste and texture. Wheat flour type 650 bun is produced in our mill, and the grain used in production comes from the surrounding areas. The flour does not contain bleach, improvers or any additives, and is produced in a natural way.

White beet sugar in Poland and Europe in the first half of 2024

Important events and factors affecting prices, imports and exports

Impact of sugar influx from Ukraine

Forecasts for the sugar market in Poland and Europe for the second half of 2024

Factors affecting forecasts

Applications

Information about the company MBF Group SA

Portfolio kontrahentów i partnerów biznesowych

Stability and production growth: analysis of the sugar trading market in Q1 2024

Dynamic development on the sugar trading market

Current Market Trends

1. import strategy from Ukraine: new supply opportunities

2. flexibility of framework agreements: responding to increased demand

3. diversification of sources of supply: From Ukraine and Poland

4. prospects for sugar brokering: a new source of revenue

5. stability of cooperation with contractors: a key element of reputation

Opportunities

Summary

Delivery of ICUMSA 45 food sugar