How to take advantage of rising prices

Le Betteravier Français
Tuesday, September 21, 2021
In Europe, the spot sugar market is following the recovery in global sugar prices. In a context of European stocks at a historically low level, we are approaching 500 € / t at the French factory. There is little reason for this to change for the season which will begin, when the areas to be harvested are at their lowest since the end of quotas. Yet despite soaring prices, sugar beet growers are slow to reap the benefits of this development. "When sugar is sold in Europe, these are often fixed-price, long-term contracts unrelated to the world price," explains Timothé Masson, CGB's director of economics. According to him, there is a deficit of European market indicators allowing the establishment of indexed contracts, as we can know in wheat, corn or rapeseed. “When the market is depressed, buyers tear up the contract, but it is difficult for suppliers to complain even if it is illegal. On the other hand, when the market goes up, it is impossible for the supplier to review the contract with his client”, he said. For him, it is urgent to establish a "reliable sugar price indicator which constitutes a recognized benchmark". This is precisely what the law adopted by LREM deputy for Aube, Grégory Besson-Moreau, aims to implement, aimed at improving farmers' income. Passed unanimously in the National Assembly in June, it is now being considered in the Senate. This text, commonly called EGalim 2, complements the 2018 Food Law.
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