Ethanol demand improves Südzucker prospects

The German sugar group Südzucker has revised its expectations for the 2019/2020 financial year upwards. The reason is the higher turnover for renewable ethanol.

Sudzücker's forecast is that revenues will still amount to €6,7 to €7 billion (last year €6,8 billion), but operating profit will climb to €50 to €130 million. Previously, the assumption was between €0 and €100 million (previous year: €27 million).

Less loss of sugar branch
The historically low sugar market caused the sugar branch of Südzucker to lose €239 million last year. The company therefore announced at the end of January that it would reduce production by 700.000 tons. A loss of between €200 and €300 million was initially assumed for this year. That has now been adjusted to a maximum loss of €260 million.

The prognosis is particularly good for the CropEnergies sector. A result of €70 to €90 million is expected, compared to €33 million last year. According to Südzucker, this is due to a robust demand for climate-friendly alternatives to fossil fuels in several European countries.

For the current third quarter, Südzucker now expects a slightly positive operating result, compared to -€23 million last year.

Jeanette Pennings

Jeannet has her roots in the flower bulb sector and she grew up on an agricultural company in the northern part of North Holland. As a generalist she reports for Boerenbusiness across all sectors. She is also exploring the possibilities of sponsored advertising.

j.pennings@boerenbusiness. Nl

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