Companies limit sugar sales in order to force price up

Four leading sugar companies that control nearly 70% of the domestic market have initiated a plan to limit sales in order to drive up prices, Gazeta Wyborcza has learned. Citing unofficial sources, the daily says the deal was struck during a meeting last week in Warsaw that brought together the presidents of the four companies and Deputy Agriculture Minister Feliks Klimczak. The plan is to limit sales until the price of sugar reaches at least zł.2.10 per kilogram. Such a price would provide a solid foundation for the launch of the planned giant holding company, Polish Sugar, under which would be grouped all the sugar companies that have not yet been privatized. Market insiders predict that sugar prices would have to be nearly zł.2.40 per kilo before the new holding company could be confident of making a profit and developing. The current price of sugar will therefore be a major factor taken into account by the Sejm and President Aleksander Kwasniewski in their deliberations concerning the setting up of Polish Sugar. A decision is expected within a couple of weeks. (Gazeta Wyborcza, p.1) M.K.