Reforms to EU sugar regime are on the way
Bio-ethanol offers beet growers brighter future
Could bio-ethanol production
be the saviour of the
British sugar beet industry?
Edward Long reports from
the Sugar Prospects
conference, organised by
Farmers Link in Suffolk
Different visions of the future… There are tough times ahead, so get used to it, says DEFRAs head of arable Andrew Kuyk (left); Norfolk grower Andy Peck (centre) predicts slashed incomes and lay-offs; while former Tate & Lyle technical director Mike Bennett (right) says bio-ethanol prospects are bright – if we move now.
BIO-ETHANOL produced for fuel from sugar beet and wheat could revolutionise British agriculture and benefit the global environment.
Such fuel cropping could amount to demand 500,000ha (1.25m acres) more wheat and 250,000ha (625,000 acres) more beet, potentially replacing much of the area put into set-aside each year.
Furthermore, for a beet factory producing sugar and ethanol in parallel, the cost of producing sugar is cut by 30-40%, making home-grown sugar more competitive on the world market.
But the UK is being left behind in the push for environmentally-friendly fuels from farm crops, former Tate & Lyle technical director Mike Bennett told the recent conference.
"Bio-ethanol has massive potential to revitalise agriculture and create local industries in the countryside to transform the rural economy. Within the next 30 years demand for mineral oil could exceed supply, so an alternative is desperately needed."
The EU has set a "bio-carburants" production target of 220m hectolitres/year (1 hectolitre = 100 litres) by 2010, with a target of 60m hl by 2003. Brazil already produces of 150m hl of such fuel.
Caught napping
"Bio-ethanol is being produced in many European countries, now is the time to take it seriously in the UK. If not there is the danger that in a few years we will be caught napping and be forced to import our requirement from France."
In the UK Budget last year, it was proposed, for the first time, that an incentive be given to boost bio-fuels. From this April, a 20p/litre reduction in tax levied on bio-diesel is proposed, plus support for research into bio-ethanol production.
As new car engines can take petrol blended with up to 85% ethanol, the EU is believed to want a mandatory inclusion rate of 10% in all liquid fuels.
The French bio-ethanol production target of 4m hl/year would require crop from over 100,000ha (250,000 acres) of farmland.
"Assuming an ethanol yield from beet of 6000 litres/ha and 4000 litres/ha from wheat grown in a two year rotation we would need to grow 500,000ha more wheat and 250,000ha more beet. For the past two years set-aside has exceeded 500,000ha," said Dr Bennett.
The environmental pay-off comes as carbon dioxide is recycled, resulting in less atmospheric pollution. When ethanol is burnt emissions include CO2 recently extracted from the air not in fossil fuel.
Each tonne of fossil fuel replaced by renewable ethanol represents a saving of 3t of CO2, said Dr Bennett. During the ethanol production process, a further 1t can be prevented from escaping into the atmosphere.
"When a beet factory produces sugar and ethanol in parallel, the cost of making sugar drops by 30-40%. That totally changes the economics of production to make home-grown sugar more competitive on the world market."
Reforms to EU sugar regime are on the way
THE UK government believes reforms to the EU sugar regime are inevitable. But growers at the conference were far from happy with that position.
DEFRAs head of arable crops, Andrew Kuyk, told delegates that beet growers in the UK needed to accept that radical changes are coming and to prepare to compete in a more open market.
"Last years changes were a modest step forward, but left the bulk of the regime intact.
"More radical change is needed because the current EU sugar price is between two and two-and-a-half times world levels and the regime is very protectionist."
But that upset farm manager Andy Peck, who grows 110ha (272 acres) of beet to meet a 5000t quota at Saham Toney, near Watton in Norfolk.
"Payments dropping to cereal-like levels with no further support would have a devastating effect on East Anglian beet growers and on rural economies.
"Labour would have to be shed and the impact on the local area would be enormous and far-reaching.
Yield potential
"We are not getting the support and backing needed from DEFRA and British Sugars 20:20 vision challenge is meaningless on unirrigated, light land like ours, where the yield potential depends on the seasonal weather."
However, Mr Kuyk insisted that the EU is committed to trade liberalisation in everything but military armaments. "We want British growers to anticipate significant reforms ahead, so their implementation – whenever it comes – will be less painful than a sudden switch to a new arrangement."
The sugar regime has been in place since 1968 and was last reformed in 2001. But its basic structure, with support arrangements, remains in place until possibly 2006.
EU sugar production is running ahead of consumption, so there is a surplus to export. Under the present system that costs a lot in subsidies.
"The 30-plus year old sugar regime is the least reformed of all the EU regimes, but change is coming. One possible scenario includes lower support prices, or the introduction of cereal-style area aid payments," said Mr Kuyk. *