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Sugar segment

Sugar market

EU Sugar Policy

New market framework 1 October 2017
  • Elimination of sugar and isoglucose quota
  • No minimum beet price
  • Contractual duty between industry and farmer
  • Temporary EU market options:
  • Security net: Private storage, special measures in the event of crises possible
  • No export restrictions

Access to EU markets for non-EU countries remains unchanged
  • Import duty 419 €/t (white sugar) resp. 339 €/t (raw sugar) from non-preferential countries
  • Existing duty-free preferential agreements with LDCs and ACP countries: without limitations on volumes
  • Existing duty-free and duty reduced preferential imports: with limitations on volumes

Opportunities
  • Südzucker is in good starting position as largest producer of beet sugar with focus on best growing regions
  • Only limited effort needed to increase and extend current production level
  • Utilization of current European logistic network to optimize sugar distribution and development of new markets outside the EU
  • Strengthening and extension of cooperations (e.g. ED&F Man, LDC/ACP producer)
  • Investment program to exploit future market potential (e.g. starch)

Challenges
  • Volatility in world market price and volume with stronger influence on EU market
  • Stronger competition for beet sugar, isoglucose and import possible
  • Sugar production will concentrate at the most efficient beet sites
  • Raw material security in increasingly more volatile market environment
  • Further EU free trade agreements with third party countries

Südzucker is well prepared and accepts the challenge