Impact of Regulatory Pricing and Currency Fluctuations on Iran’s Raw Sugar Importers and Refiners

Economically, importing and refining raw sugar is very cost-effective for the country’s macroeconomics compared to white sugar. The price difference between raw sugar and white sugar in international markets fluctuates between $60 and $110, which will be less than the costs of refining and waste. The best solution for refining raw sugar is to allocate this work to specialized raw sugar refining factories.

Since raw sugar refining units have permanent workers and their activities are continuous, restricting the import of raw sugar at certain times of the year will cause irreparable damage to these industries. It is proposed that the import quota for these factories, which also have a cooperative supply company, be provided throughout the year in a way that ensures their continuous activity. This fair solution can both eliminate the country’s shortage and ensure their continuous operation.

The most important factor preventing investment in the domestic production sector is regulatory pricing. As long as the necessary return on investment is not achieved, increased investment and production growth will not be possible.

It should also be noted that sugar smuggling only occurs when the difference between domestic and foreign prices is more than 40 percent. In the current price conditions, there is no serious sugar smuggling.