News Sugar
French beet price rises, prospects are good
One of the two major French beet cooperatives, Cristal Union, has announced its 2021 beet price. This amounts to €29 per tonne of beets. The result is marginally higher than previously anticipated.
The price is almost €10 below the level of the Netherlands last year, which is not surprising. This roughly corresponds to the cooperative result with which Royal Cosun can increase the beet price annually. Cristal Union pays this amount for beets delivered with 16% sugar. It is precisely that sugar content that is a problem this year. Due to the growing season with dark weather in the summer and a wet late summer and autumn, the roots are less sweet.
Yield better, but not great
Together with competitor Tereos, the Cristal Union cooperative owns 85% of all sugar beet in France. A total of 410.000 hectares have been sown this year, which should yield a yield of 34 million tons this season, according to government figures. That is 30% more than in the dramatic 2020. Then the yellowing virus was all around. Despite this, the yield is still 8% below the multi-year average of 87 tons per hectare. This year, 83,4 tons are expected.
Cristal Union hopes to increase the payout price to €30 per tonne for next year. The cooperative already guarantees a price of €28 for next season. This includes a premium for the pulp and with a guarantee that the acreage will not be reduced. With a yield of 87 tons, this results in a gross balance of €2.610 per hectare. If you thresh 9 tons of wheat at $255, that's $2.295. Excluding any straw yields. An additional advantage is that beets require less nitrogen and the cultivation costs are lower. At the same time, it has also become an uncertain crop, although the French do have the opportunity to use neonicotinoids-coated seed thanks to the derogation granted this year.
No less beets
Despite the relatively high level of grain and rapeseed prices, the sugar beet acreage is unlikely to suffer as a result, if at all. The sugar producers are also aiming for a constant or larger area.
Compared to last season, Cristal Union pays €2 per tonne more. According to the cooperative, this is due to the better selling prices for sugar, ethanol and alcohol. The outlook for 2022 is positive. What is depressing profits is the increased cost of energy. The factories consume an enormous amount of natural gas and those costs have risen sharply. According to vice director Xavier Astolfi, the cooperative has hedged 90% of its gas needs (predetermined) so that the impact on the current processing season is limited.
Niels van der Boom
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