State intervenes in the sugar market

RIGA (BNS) - The government approved the state intervention in the sugar beet market. Sugar beets will be purchased from farmers in autumn with state funds because sugar processing plant Jekabpils Cukurfabrika is unable to do so due to its financial problems. No intervention would cause significant tensions in the sugar market.

The state would also finance the processing of beets at the plant in Jekabpils.

Margers Krams, the Ag-ri-culture Ministry's parliamentary secretary, said the total costs of this intervention in the sugar market from September to the end of the year would be some 2 million lats ($3.45 million).

By selling sugar beets to the state, farmers will receive 7 lats per ton from the agriculture subsidies and another 10 lats per ton after the sale of sugar.

With this intervention farmers will be guaranteed payment for their products and Jekabpils Cukur-fab-rika will be able to survive for another season, the ministry official said.

He add-ed, however, that the contemplated measures were not likely to improve the factory's situation.

The legislative amendments aimed at establishing the body implementing the state intervention in agriculture will be presented to the Latvian Parliament this week.

The amendments to the laws on sugar and Latvian grain market will be proposed by the parliamentary economic, agrarian, environmental and regional policy committee.

The committee Wed-nes-day decided to ask other parliamentary committees to discuss the bill promptly so that its final reading could be reviewed by the Parliament already Sept. 2.

The new state intervention agency will be established as a result of the reorganization of the National Grain Trading Agency.

The largest creditor of Jekabpils Cukurfabrika, Latvijas Unibanka, for now may not institute insolvency proceedings against the factory because its stocks of sugar cover its debt.