‘One off’ sugar beet quota cut

Sugar beet growers in the UK are facing a quota cut of 11.7%, in addition to the 6.8% reduction already agreed for this season, as the EU seeks to contain production.

The cut has been made necessary because the EU has to greatly reduce the amount of subsidised sugar it exports to the world market, following a WTO ruling.

It aims to achieve this through the voluntary restructuring scheme agreed as part of last year’s sugar reform.

But this will not deliver the required reduction for a least a couple of years, hence the compulsory, though temporary, quota cut now.

“This one-off reduction is necessary to ensure that the newly-reformed sugar regime gets underway without heavy surpluses undermining market balance,” said a commission statement.

Overall the EU is looking to reduce total production in 21 sugar-producing countries by 2.5m tonnes to 15.5m tonnes this season.

That is equivalent to a cut of 13.6%.

But a lower figure (11.7%) was agreed for the UK, and many other countries, to allow for the fact that it has a smaller B quota and therefore contributes less to export surpluses.

Denmark, France and Germany, in contrast, are looking at cuts of over 16% due to their above average levels of B sugar, while Lithuania will only suffer an 8.6% reduction.

UK growers may also delay their cut in contracted tonnage until the 2007/08 season (News, 17 February).