British Sugar launches new £40/t contract for 2023-24

Sugar beet growers are being offered a substantial price rise for next season, which both the NFU and British Sugar hope will encourage more farmers to stick with the crop and reverse the recent declines in the area grown.

A statement from the two bodies has confirmed a beet price of £40/t for the 2023-24 contract year, up 48% on last year, with a number of new options for growers to consider as part of the contract.

See also: Three ways to maximise sugar beet yields

“With growers facing significant cost increases, and the prices of alternative crops having risen to unprecedented levels, I am glad we agreed on a contract offer that should keep sugar beet as a valued part of growers’ rotations,” said NFU Sugar board chairman Michael Sly.

“After a couple of challenging seasons that highlighted the increased risks growers are facing, I am pleased we have found a pioneering way of allowing growers to mitigate their yield risk.

“There is no doubt that we have been concerned about the decline in growing area over the past two years and the subsequent effect this had on the supplier base. It was important this deal addressed that and I hope now we will see that decline reverse and the industry rebound.”

As well as the basic price increase, the new contract offers:

  • A “yield-guarantee” product (in return for a small payment) that protects income against yield losses
  • A “futures-linked” variable price contract for up to 20% of the 2023-24 crop
  • A local premium of up to £2/t for those within 20 miles of any British Sugar factory
  • An “upgrade” from £25/t to £32/t for all growers with an existing 2023 commitment (which can be further upgraded to £40/t if they commit to grow sugar beet in 2024)
  • A cash advance option.

Paul Kenward, managing director of British Sugar, said £40/t offered growers a “healthy margin, even at today’s high costs”, and compared very favourably with alternative crops.

“We are confident that this straightforward, attractive offer provides choice, security and profitability during an extremely challenging time for all growers,” he said.

“On top of a compelling price, we have listened to calls for flexibility, and growers now have an option to opt in to the new risk-mitigation option we are offering for yield protection, as well as a cash advance option for the 2023 crop.

“We are really well placed to partner with growers for the long term, and I am certain this contract will encourage further investment going forward.”

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