News Sugar
Beet price lower due to pressure on sugar market
The sugar market is clearly experiencing a surplus, which results in a fall in prices. Cosun also expects a lower sugar beet price compared to last year. Minister Carola Schouten (Agriculture, Nature and Food Quality) wants the sector itself to realize that overproduction results in low prices.
The Brussels sugar consultations show that sugar prices are low, partly as a result of the good harvest and increased production. The average price is currently around €362 per tonne, while last year the price was €500 per tonne at the same time.
The International Sugar Organization (ISO) expects a production of more than 2017 million tons for the 2018/185 season. Consumption is 175 million tons, increasing the closing stock by 10,5 million tons (to 92 million tons). A higher sugar production is again expected for the coming season. In the Netherlands, the sugar beet acreage does not change appreciably. It CBS estimates the area on 85.320 hectares.
Schouten reacts
Minister Schouten stated in a letter to parliament that it is up to the market to regulate the increased sugar production. According to Schouten, it is still too early to take measures. "The European Union (EU) has not chosen for nothing to abolish the sugar quota and for more market orientation in the Common Agricultural Policy (CAP)", says Schouten.
Schouten continues: "It is up to the sector to realize that increased production often also has a downside." Dirk de Lugt, chairman of Cosun, previously reported that he expects the sugar beet price for the coming harvest to be lower than the €45,62 per tonne paid for the 2017 harvest. So it could well be that the price under €40 per tonne will be achieved.
Dumping
EU customs figures also show that sugar production is increasing. More than 2,5 million tons of sugar has been exported from the EU this season. That is more than 1,6 million tons more than last season, when the quota was still there. As a solution for the large harvest, extra ethanol is being produced in various countries.
The fact that more is being produced in Europe has consequences for Spain and Italy, among others. MEPs from those countries complain that sugar is sold at prices that are considerably lower than those of the country itself. This despite the considerably higher transport costs.
Anne-Jan Doorn
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