Sudan calls off launch of $1 billion sugar plant - Reuters

* Boosting sugar production a top priority

KHARTOUM, April 3 (Reuters) - Sudan has shelved the launch of a $1 billion sugar plant, state media said on Tuesday, delaying a strategic industrial project that was meant to help the government overcome a severe economic crisis.

The African country is trying to cut food imports that are stoking inflation. Sudan is undergoing an economic crisis after losing three-quarters of its oil production -- the lifeline of the economy -- when South Sudan became independent in July.

Boosting sugar production is a top priority as sugar is the most important food item for the 32 million Sudanese. Like other food items the cost of sugar has increased since oil revenues, the main source for hard currency, has dried up since July. Much of the sugar is imported.

President Omar Hassan al-Bashir was meant to inaugurate the White Nile Sugar Co on Thursday but state news agency SUNA said the launch had been delayed due to "emergency technical reasons." No new date was given.

Bashir rejected a resignation offer of industry minister Abdul-Wahab Osman over the delay of one of Sudan's biggest development projects in the past few years, SUNA said.

Last month, Sudan said the plant would start with an initial annual output of 150,000 tonnes that would gradually rise to 450,000 within three years as parts of efforts to achieve self-sufficiency in sugar by 2014.

Kenana Sugar Co, owned by Saudi Arabia, Kuwait and Sudan, is the biggest shareholder of the plant apart from Sudanese firms and two Egyptian investors. (Reporting by Ulf Laessing; Editing by Bob Burgdorfer)