News and views

As I browse the web researching various topics concerning the EU and UK sugar markets, I've been bookmarking interesting weblinks. Some of these are news clippings, some are links to official documents, and some are interesting data sources.

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AB Sugar revenue was 12% ahead of last year, driven by stronger European sugar prices, higher Illovo domestic sales and improved pricing for bioethanol

AB Sugar revenue was 12% ahead of last year, with operating profit ahead of last year. The revenue increase was driven by stronger European sugar prices, higher Illovo domestic sales and improved pricing for bioethanol produced by British Sugar at Wissington. All businesses have been focused on mitigating the effects of significant cost input inflation, particularly in energy costs. European sugar prices increased over last year as a consequence of low European sugar stocks combined with higher world market prices. Estimates for European sugar production in the 2021/22 campaign are slightly higher with a recovery in yields to more normal levels, supported by good growing conditions. Our UK and Spanish businesses have largely contracted sales for the financial year at these pricing levels. Sugar production in the UK for the 2021/22 campaign is expected to be 1.04 million tonnes, compared to 0.9 million tonnes produced in the last campaign with higher yields more than offsetting the reduced growing area. Energy costs are at very high levels but forward contracts have avoided the impact of these during the first quarter. Preparation for the start of production at the Vivergo biofuel plant in Hull is well advanced. The trading performance in Spain has improved, with higher prices and volumes partially offset by a higher proportion of sugar produced from cane raws. Illovo continued to deliver strong domestic sales in Zambia, Malawi and Tanzania along with a strong contribution from co-products in South Africa. However, there was some disruption to production in Zambia, Eswatini and Mozambique in the period. Contracts have been placed and site works commenced for a major expansion of our sugar production capacity in Tanzania.

European Council

France intends to prioritize "reciprocity of trading standards" in trade with the EU

France intends to prioritize "reciprocity of trading standards" in trade with the EU – in other words new "mirror clauses" targetting phytopharmaceutical products, carbon leakage and deforestation The French Minister for Agriculture and Food, Julien Denormandie, stated, "Importing products into the European market that do not abide by the EU’s own production standards is inconsistent from every perspective, whether economic, environmental or food-related. Taking action to ensure that standards are reciprocal is a considerable task, and one that is at the top of the French presidency’s priorities". Presenting the French presidency’s priorities in the area of agriculture and fisheries, the Minister stated that these priorities include, on the one hand, the reciprocity of trading standards – in other words, ensuring (chiefly by means of ‘mirror clauses’) that agri-food products imported into Europe abide by the EU’s environmental and health standards, particularly as regards the sustainable use of phytopharmaceutical products – and, on the other hand, low-carbon agriculture, in particular carbon sequestration in agricultural soils. The presidency will also aim to take forward work in the following areas: evaluation of the national strategic plans, as part of efforts to ensure the transparency of the CAP reform; the proposal for a regulation on statistics on agricultural input and output; revision of EU legislation on geographical indications; the regulation on deforestation-free products; and the EU’s agricultural product promotion policy.


"Cruiser SB" approved in England to protect sugar beet if specific conditions are met

Defra has today approved an emergency temporary authorisation for the use of a neonicotinoid pesticide treatment on the 2022 sugar beet crop in England only due to the risk to the crop from yellows viruses. Emerging sugar beet seedlings are vulnerable to predation by aphids which have the potential to spread beet yellows virus. Sugar beet crops have been severely affected, with 2020 yields down by a quarter on previous years. Other pesticide and organic treatments are not sufficiently effective in controlling viruses. 63% of the UK’s sugar comes from domestic production of sugar beet which could be at risk if a significant amount of the national crop is infected. The strictly time limited emergency authorisation of this neonicotinoid treatment - Syngenta’s Cruiser SB - will provide emergency protection against this virus, which could significantly impact yields of the sugar beet crop while the beet industry develops alternative solutions. Its exceptional temporary use will be tightly controlled and only permitted in very specific circumstances when strict requirements are met. A Defra spokesperson said: “This decision has not been taken lightly and is based on robust scientific assessment. We evaluate the risks very carefully and only grant temporary emergency authorisations for restricted pesticides in special circumstances when strict requirements are met. “Last year the threshold was not met so the authorisation was never exercised. Strict criteria remain in place meaning this authorisation will only be used if necessary.”

Queensland Country Life

UK free trade agreement heralds new opportunities for Australian sugar

CANE farmers say the official signing of the Australia-UK Free Trade Agreement signals new new trade opportunities. Canegrowers chief executive officer Dan Galligan said the Aus-UK FTA would take the Australian sugar industry a step closer to rebuilding what had once been a strong trading relationship with the United Kingdom, after a 50-year hiatus. Once the FTA comes into force it will give up-front tariff-free access for 80,000 tonnes of Australian sugar to be sold to the UK in the first year, increasing by 20,000 tonnes each year for the next eight years. "This is a huge boost on the 9925 tonnes quota we had for the whole of the European Union prior to Brexit," Mr Galligan said. "The Australian industry looks forward to supplying high quality, sustainably and ethically produced sugar to top up local beet sugar production so that UK refiners can meet the country's needs. "The signing of this FTA is the second piece of good trade news this week and it's bolstering the spirits of growers working in a number of regions to finish harvesting the 2021 crop after a difficult season." Earlier this week the World Trade Organisation found in favour of Australia in its dispute with India over that country's price supports for sugarcane and export subsidies. "While markets in the Asia-Pacific region will continue to be the main focus of Australia's sugar sales, this Aus-UK FTA will allow for some important diversification for our export-oriented industry which relies on a fair and rules-based world trading system," Mr Galligan said. "We thank the Australian government for achieving these results."