CAIRO: A sugar beet refinery to be built in Port Said at a cost of $400 million will have a capacity of 500,000 tons of sugar a year, making it the country's largest sugar refinery. “It is important to note that the factory will not be producing its own local sugar,” said Mirette Heozi, senior analyst at CI Capital. “They will be refining imported sugar.” Investment firm Beltone Financial said all funds going towards investing in the plant will be coming from local companies but did not list any specific names, according to a report by state-run Al-Ahram newspaper. Heozi said Egypt has a large sugar deficit, standing between 700,000-800,000 tons. However, local sugar producers are currently at an advantage. “For local producers of sugar, it depends on international prices and international prices of sugar are currently very high, which gives local producers an edge,” she noted. If global prices of sugar were to become lower, it would put local producers at risk and they might have trouble accommodating their prices to meet international standards. “This was the case in the first quarter of 2009,” said Heozi. “The cost of production was high for local producers, but international prices of sugar were low, and local producers couldn't lower their prices any further in order to compete so they incurred losses.” Egypt produces around 1.99 million tons of sugar per year, which meet 72 percent of the local demand. Heozi noted that, usually, international prices of sugar depend on the weather conditions of the world.
