Economy, Business And Markets

Iran Buys More Raw Sugar as Imports Gather Pace

Iran Buys More Raw Sugar as Imports Gather PaceIran Buys More Raw Sugar as Imports Gather Pace

Iran has bought 60,000 tons of Brazilian raw sugar, adding to an earlier purchase this month as the Islamic Republic steps up imports.

Iran’s state buyer the Government Trading Corporation purchased the cargo earlier this week from an international trade house.

One senior trade source said it was for prompt shipment and that the price paid was $466 per ton cost and freight, Reuters reported, citing trade sources on Thursday.

This followed the purchase of a separate cargo of 60,000 tons of Brazilian raw sugar for July 15-Aug. 15 shipment in early July, sources had said.

Another trade source said GTC appeared to have paid a slightly higher price in the latest tender.

“It looks like there is more buying impetus from GTC. This could be an indication of stock building,” the second source said.

“Iran still remains under financial pressure at the moment.”

Trade sources told Reuters last month that Iran had picked up at least 250,000 tons of Brazilian raw sugar for shipment in May and June in a series of deals, adding that the buyers were mainly private importers.

International measures against Iran, including banking restrictions, were lifted in January as part of a deal with world powers under which Tehran agreed to limit its nuclear program.

While there were never restrictions on Iran’s food and humanitarian trade, continuing trade finance problems and stockpiling of commodities, including sugar, last year slowed activity.

Trade sources said Iranian buyers last picked up sugar in the final quarter of last year.

Domestic sugar production in Iran stands at about 1.5 million tons per year while of imports amount to some 1 million tons. Private traders are allowed to import 900,000 tons of sugar every year while the government also imports 300,000 tons for its strategic reserves.

In its latest report on Iran’s agribusiness, the Business Monitor International forecast that sugar consumption in Iran will grow 27.6% by 2020 to reach 3.1 million tons, explaining that demand will be mainly driven by population growth and improved macroeconomic conditions following the lifting of sanctions in 2016.