In view of the better figures, the French sugar cooperative Cristal Unión has decided to increase the sugar beet price for next season. She also expects a big plus for the season after that. That while competitor Tereos recently announced that it might reduce production capacity.
Cristal Unión, France's second largest sugar producer, promises sugar beet growers a higher price per tonne after it was announced that the 2021/2022 net profit will be €97 million, helped by higher sugar and ethanol prices. That is 40% higher than the year before, when net profit came in at €69 million. Because of these higher results, the cooperative decided to increase sugar beet prices for the coming season. In December, the price for newly sown sugar beet was estimated at €30 per tonne, which has been adjusted upwards to €35 per tonne of sugar beet.
Harvest 2023 even higher
In addition to increasing the sugar beet price for this growing season, the target was also set to reach €40 per tonne with the 2023 harvest, the director of Cristal Unión said during the press conference where the figures were discussed. With the increase, the company wants to give farmers more confidence after the sharply rising costs of the crop. Previously, there was uncertainty about where the profit would come from, as the production costs of the factory also increased. However, the director says that they have been able to quickly pass on the rising costs to their customers.
According to Cristal Unión, the campaign yielded 13 million tons of sugar beet last season and the company's acreage was 152.000 hectares. On average, about 80 tons of one hectare were harvested. After a 10% decrease in the sugar beet acreage, the cooperative expects the acreage to stabilize.
Tereos reduces production capacity
The major competitor Tereos, and also France's largest sugar producer, thinks very differently about this. According to Reuters, the sugar giant announced last week that it may close two factories as part of its long-term outlook. With this they want to anticipate further declines in sugar beet production. The company, also the second largest sugar producer in the world due to its activities in Brazil, had said in 2020 that it would not close any factories, unlike its competitors. It's coming back now. Tereos expects the acreage to shrink by another 2024% by 10. Unlike Cristal Unión, Tereos does not provide a price forecast for the current season.