EU sugar plan could slash beet prices

By Charles Abel and Robert Harris

BEET prices could plummet if proposals to open the EU to world-market sugar go ahead, the NFU has revealed.

With time running out before foreign ministers meet in Brussels to discuss the issue, the union has released calculations that show growers could face an A/B beet price of just 10/t, as well as the well-documented 40% contract cuts.

That could knock 126/ha from the net farm income of sugar beet farms, pushing most of the 6000 significant beet growers into a loss.

Under the EUs “Everything But Arms” (EBA) vinitiative, 48 of the worlds least developed countries would be guaranteed tariff-free access to EU sugar markets.

And it is the removal of tariffs, which protect EU prices, that has caused renewed concern. EU beet prices could fall to world market levels of 10/t or less.

The NFUs sugarbeet committee chairman, Matt Twidale, urges growers to lobby MPs and MEPs.

Foreign ministers will not now be able to vote on the EBA initiative at the General Affairs council next week but ministers could rubber-stamp it early in the New Year.

But Mr Twidale says: “It smacks of a done deal designed to give the EU the moral ground in WTO negotiations.”

British Sugars Robin Limb agrees that prices could slump.

But he argues: “It is not an immediate threat because import tariffs and quotas to these countries are due to be cut over four years.

“However, it could happen five to seven years down the line.

Voting the EBA initiative through could actually cost consumers more.

“At the moment, the sugar regime is tax neutral – there is no net cost to the CAP.

“Growers and processors pay levies to cover the cost of selling surplus-to-consumption quota sugar on the world market.”

Even if sugar values do come down, consumer prices may not.

“In the UK, the sugar price has fallen 33% in the past four years. But the average price of sugar-based food products has gone up.”

Ironically, although the initiative aims to help underdeveloped countries, it would hit the African, Caribbean and Pacific nations which already have preferential access to the EU, says Mr Limb.