Sugat to close its Kiryat Gat sugar refinery

Sugat will close down its sugar refinery in Kiryat Gat in six months and import high-quality white sugar from various foreign sources, it announced on Sunday. The company said it would try to employ some of the refinery’s employees in its other business in Kiryat Gat, but 60 employees would be laid off.

Sugat made its decision because Europe is resuming unrestricted sugar exports after 10 years of export quotas, thereby making sugar refining in our region unviable, Sugat CEO Gilles Gamon said.

Market forces are affected by the large stock of white sugar in the world produced from beets, which makes cane sugar uneconomical. “The decision will enable Sugat to compete in a dynamic market and to continue supplying the best products and services to its customers,” Sugat said in a press release.

Sugat’s annual sales turnover is NIS 850 million, amounting to a 1.3% market share in the Israeli food market, making the company one of Israel’s largest food companies. Although it accounts for 95% of the sugar sold in Israel (including sugar that it produces under private brands), 65% of the company’s revenue comes from the sale of sugar to industry.

Sugat founded its sugar refinery in 2008 when sugar imports from Europe were halted almost completely. It said it would continue its range of activity in Kiryat Gat, including the supply of 250 different food products to the retail market and a similar number of products to the institutional market. Its logistics warehouse serves industry, the institutional market and the retail market. The company also cleans, sorts and packages legumes, rice, grains and other products, including Israeli agricultural crops.

Last April, following the Health Ministry reform requiring the marking of products containing sugar, Sugat announced it would begin marketing a natural stevia-based sweetener and would try to compete with the existing sweeteners in the retail market and the food industry.