Belgian beet price for 2018 sadly low

The expected payout price for sugar beet that ISCAL Sugar is paying out for 2018 is expected to be distressingly low. This is reported by the Confederation of Belgian Beet Planters (CBB). The beet processor pays the growers an advance at the end of December, during which a final forecast can also be made.

ISCAL Sugar has 2 factories: 1 in Mons (Mons) and 1 in Fontenoy. Also in the Netherlands it has 1 factory, in Lelystad. Refined sugar is packaged here for the food industry. In addition to ISCAL, sugar beet is also grown in Belgium for the Raffinerie Tirlemontoise, owned by Südzucker. It concerns 2 factories (Tienen and Longchamps). Together they process the harvest of more than 64.000 hectares of sugar beet.

Lower advance
ISCAL Sugar will pay out the advance on the 22 beet price on Saturday 2018 December. This amounts to €10,30 per tonne, with a sugar content of 17,5%. This means that the advance is €3,13 lower than last year, or almost 25%. That writes growers' organization CBB in their member magazine. The extremely low sugar price is the direct cause.

Based on the advance, CBB also outlines the expected final payout price. That comes to €22,89 per 100 kilos, with 17,5% sugar. ISCAL expects an average of 77,5 tons of beets to be harvested per hectare, with a sugar content of 18,5%. This brings the financial yield to €2.225 per hectare, including a beet pulp compensation of €4 per tonne.

The price can be adjusted slightly upwards if the sugar market evolves positively. A global sugar shortage is forecast for the 2019/2020 season, leading ISCAL to hope the low payout price is a one-off.

Tiense Sugar
Raffinerie Tirlemontoise has not yet released any amounts. At the end of November, it paid out a final amount for surplus beets grown in the 2017 campaign. With this payment, the final payment price for surplus beet comes to €15,43 per tonne, with 17% sugar and including pulp compensation. The final price for beets under the basic contract is €23,52 per tonne.

For the 2018 harvest, Tiense Suiker expects an average yield of 82 tons per hectare at their location in Tienen, Flanders, with 18,7% sugar. For the factory in Longchamps in Wallonia, this is 79 tons per hectare, with 18,6% sugar. The chance that the 2018 beet price will end above that of 2017 is estimated to be very small. The recovery in the sugar market was too short-lived for this.

Factories jointly responsible
CBB is calling on European sugar factories to control production, but has doubts whether this will happen. According to the CBB, the fact that Südzucker increased the acreage by almost 2017% in 25 partly ensures that the entire sector was dragged into unprofitable cultivation. According to them, the European sugar companies are jointly responsible for the current situation and subsequent payment price.

Niels van der Boom

Niels van der Boom is a senior market specialist for arable crops at DCA Market Intelligence. He mainly makes analyses and market updates about the potato market. In columns he shares his sharp view on the arable sector and technology.

n.vanderboom@boerenbusiness. Nl

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