Sucden Invests $100M to Raise Russian Sugar-Beet Output

Sucres et Denrees SA plans to invest $100 million expanding its Russian sugar-beet production to meet growing demand from customers including Coca Cola Co.

Sucden, as the Paris-based company is known, produced 475,000 metric tons of sugar in Russia last year, its country chief, Etienne Pelletier, said today by phone. The company intends to increase sugar-beet output 5 percent this year and a further 5 percent next, and wants to produce 600,000 tons of sugar in 2017. The investment will be used to upgrade two of its three Russian plants and buy more land.

Sucden produced 175,000 tons of the sweetener in Russia from imported raw cane sugar last year, according to Gleb Tikhomirov, the company’s financial director in the country.

Zug, Switzerland-based Coca-Cola Hellenic Bottling Co., which distributes Coca-Cola products in countries including Russia, wants to move away from using imported sugar for its Russian operations by 2015, it said in a 2013 performance report May 30, citing savings and sustainability benefits. The company purchased about 150,000 tons of sugar for the business last year, mostly from Sucden, Andrey Balachikhin, Coca-Cola HBC’s Russia procurement manager, said by e-mail in response to questions.

Sucden may still need to tap imports to make sugar for Coca-Cola HBC in 2015, Tikhomirov said by e-mail.

The Russian market for non-alcoholic beverages will continue to expand this year, Coca-Cola HBC said in its report. Beet crops this year are in danger from increasing dryness in southern Russia, according to Pelletier.

“We need some rain -- and quickly,” he said.

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