UK sugar beet growers are set to receive a market-linked bonus later this year after EU average sugar prices hit the trigger point for the first time.
In April, the reported market price for white sugar reached €379 per tonne, which is above the reference point of €375 per tonne.
Consequently, this triggers a bonus for UK sugar beet growers who had tonnage on a one-year contract with British Sugar for the 2019/20 crop.
The final total amount payable will be determined in the autumn, once the EU Commission has reported average prices for September.
It is expected that the bonus will be paid towards the end of 2020.
British Sugar’s agriculture director, Peter Watson said: “Although the 2019/20 market-linked bonus will be a relatively small premium this year, we’re pleased to see the mechanism triggered for the first time since it was introduced three years ago.
“We know that last year’s campaign was difficult, with unprecedented weather conditions, so it is welcome to be able to share the upside of the market with our growers.”
It is expected that around two thirds of UK sugar beet growers will receive the bonus.
British Sugar’s contracts with growers offer a market-linked bonus mechanism, triggered if the reported market price for white sugar reaches a certain price.
For 2019/20 one-year contracts, if the reference price reaches €375 per tonne, growers will receive a 15% share of the value above that point.