British Sugar edged its forecast for last season’s beet crop to a new record of 1.45m tonnes of sugar as its parent group reported a financial loss for sugar due to low EU prices.
The beet processor said it benefited from a large UK crop with good extraction rates as it pushed its forecast up from 1.44m tonnes given in late February, and to 10% above the previous season’s 1.32m tonnes.
However, British Sugar’s parent group Associated British Foods (ABF) reported an operating loss of £3m for its worldwide sugar business, which includes Europe, Africa and China.
This small loss was contained in ABF’s half-year results for the 24 weeks to February 28 and compared with a previous comparable operating profit of £64m.
The group warned that low EU sugar prices and the weakness in world sugar prices will mean only a small profit from its sugar operations for its full year to mid-September.
The group’s four beet UK factories at Newark in Nottinghamshire, Wissington and Cantley in Norfolk and Bury St Edmunds in Suffolk, finished their processing campaign in early March, taking delivery of about 7.5m tonnes of beet from some 3,600 growers.
A glut of European sugar means growers must contend with a 24% cut in their beet price for this coming 2015-16 season to £24/t from £31.67/t for the crop just harvested.
At the same time, British Sugar has reduced the amount of beet it wants from growers this coming season by 20%.
Some 11% has come from growers voluntarily taking a contract “holiday” for the 2015-16 season, while British Sugar has implemented a further 9% cut across the board.