CAIRO - Egypt's State-owned Sugar and Integrated Industries Company will launch a new production line for sugar beet in February to raise output and meet growing demand, its chairman has said. "The new line aims at easing the sugar crisis that hit the local market," said Hassan Kamel, the CEO of the Sugar and Integrated Industries Company (SIIC). "The production capacity of the new line will be 150,000 tonnes annually, costing LE900 million ($155.2 million). It will help in reducing the supply shortage," Kamel said. Against the backdrop of a supply gap and spiraling world prices, sugar has shot up to LE8 (around $1.7) per kilogramme from LE4 in the local market over the past few months. The supply gap is estimated at 1.2 million tonnes annually, according to Kamel. According to him, sugar beet output is expected to rise to 800,000 tonnes in 2011 from 660,000 tonnes this year. In November, SIIC unveiled plans to import one million tonnes of raw sugar to bridge the gap in the local market. In a bid to blanace higher demand, the Central Bank of Egypt (CBE) has exempted banks from a 50 per cent cash cover requirement on sugar imports for a period of six months. In November, world sugar prices hit a 30-year record high, driven by a plunging dollar. The sweetener, which has shot up by 140 per cent since May. Sugar prices rose for the fourth straight session on speculation that India, the world's second-biggest producer, may delay new exports. The Indian government will review its export policy at the end of January, Farms Minister Sharad Pawar said last week. Egypt imports more than one million tonnes of the sweetener from India annually to meet growing domestic demand. India's government had authorised 500,000 tonnes for export amid projections that output will exceed consumption for the first time in three years. Raw sugar for March delivery rose 0.11 cent, or 0.3 per cent, to close at 33.13 cents, according to Bloomberg. In London, refined-sugar futures for March delivery dropped $25.80, or 3.2 per cent, to $784.50 a tonne. On Wednesday, the price reached $815, the highest since at least January 1989.
