Agreement on EU sugar reform

Margaret Beckett announced agreement to the EU sugar reforms after lengthy negotiations in which ministers agreed to price cuts of 36% over four years.

Matthew Ward Farm Business Consultant of Strutt & Parker, says “The level of price cut spread over four and not two years as first threatened is obviously welcome, however, for UK growers the devil will be in the detail of the compensation package.

“Although the headline figure given in Margaret Beckett’s announcement is for compensation of 60% there is a real fear among growers that this will be diluted among all recipients of the Single Payment not just those growing beet.

“This may be a real opportunity for the industry as a whole to allow for further, much needed, rationalisation allowing those who want to expand to do so. But unless direct compensation is paid a beet price that will equate to approximately £22 per tonne will not give growers the confidence to stay in the industry and will no longer make sugar beet the most profitable of their break crops. I'm sure if this happens it will result in more growers turning to oilseed rape.”

Mr Ward concludes, “There was no doubt that change was needed within the sugar regime but it remains to be seen whether these reforms allow UK growers to be fairly compensated.”