General Prosecutor's Office to Deal With Unreasonable Sugar Price Hike

General Prosecutor's Office to Deal With Unreasonable Sugar Price Hike


The demand for staple food, including sugar, has increased in Russia. Spike in prices occurred after the introduction of sanctions against Russia in response to the start of Russia's special military operation in Ukraine to protect the Donetsk People’s Republic (DPR) and Luhansk People’s Republic (LPR.)

The Russian government was forced to impose a ban on sugar exports until August 31, and many retail chains even limited its sale in one hand. Unfortunately, all these measures did not have the desired effect, and some citizens began to complain about soaring prices or the lack of sugar on sale.

The growth rate of the cost of sugar in Russia even outpaces inflation. It should be noted that it is actively used in the production of many food products, as well as in home cooking.

“The growth of sugar prices in our country is first of all connected with the panic buying, as well as with the untimely restriction of its sale in retail chains,” Evgeny Ivanov, leading analyst of the Institute for the Conjuncture of Agricultural Markets, told “After all, there is sugar in Russia, but it is being bought up twice as fast, so it takes time to revise the current supply.”

Some domestic factories producing sugar now offer to make purchases in correlation with the dollar price, but to pay only in rubles. Moreover, producers complain about the fact that the cost of the product has increased by 60-70% “without negotiations and explanations,” and this may force them to suspend shipments if the conditions are not reconsidered “within two days.”

The RusBrand Association of Brand Manufacturers has already drawn attention to all these circumstances, sending a letter to this effect to the Federal Antimonopoly Service (FAS.) In particular, it requested that the situation be clarified and that appropriate measures be taken.

The First Deputy Prime Minister Andrei Belousov has already instructed not only FAS, but also the Ministry of Agriculture, Federal Tax Service and the Ministry of Industry and Trade to submit considerations and action plans to the cabinet to resolve the situation with sugar prices by the end of this week.

“It is necessary to identify such links in the chain of suppliers,” said Ivanov, “and then, of course, to take appropriate measures. In fact, this is not state regulation, but an ordinary fight against speculation. Besides, the Ministry of Industry and Trade is already aware of cases of unscrupulous work of packers who keep sugar for themselves.

Retail chains have already made a list of such organizations, which has been submitted to the FAS for close examination. At the moment, domestic sugar producers fulfill their obligations both to retail chains and consumers. Supplies are in line with existing contracts, and factories that produce sugar, even switched to a round-the-clock work schedule due to the increased demand for the product.

The situation has become so tense that the Prosecutor General's Office of the Russian Federation has initiated an inspection of growth of sugar prices in the country. Prosecutor General Igor Krasnov ordered to carry out “systematic work” to counteract violations of the legislation on pricing of food products “to protect the rights of citizens.” This is done not without reason, because the expert group on counteraction to crimes in the sphere of economy has already received information about the increase in the cost of sugar due to the suspension of its shipment by some economic agents.

These measures also apply to the “on-field situation.” Thus, the prosecutors of the 26 regions where sugar is produced have been instructed to check the actions of the relevant legal entities. The General Prosecutor's Office reported that a “full range of measures" will be taken to combat the artificial shortage of sugar and the “unreasonable” overpricing of sugar.

Yet, federal and large regional networks can safely maintain long-term stocks of most socially important products for another two weeks of trade. Yes, due to the sharp and unexpected spike in sales, these stocks are somewhat reduced, but they are regularly replenished and their availability is fully controlled.

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