Sugar Market Reform: Talks leave bitter aftertaste

Brussels, 06 March 2013 - Discussions on the reform of the sugar market after 2015 are being monopolised by the debate around the extension or not of the quota system.

Cane sugar refining has been a successful European manufacturing industry which has coexisted with other sweetener producers for over 100 years. Cane refiners are competitive sugar producers that contribute to food security in Europe by producing an essential commodity from a different raw material and manufacturing model. Cane refiners also provide developing countries a stable and long-term market for their raw sugar.

Refiners’ raw material is raw cane sugar, which can only be imported from preferential origins (EPA, EBA and free trade agreements). In recent years, these countries have not been able to supply sufficient raw material and the EU has not provided a viable and sustainable alternative solution.

However, there is more than solely beet sugar and quotas to consider. Current policy proposals fail to recognise and consequently address the reasoning behind the shortcomings of the last sugar market reform in 2006. Cane refiners are crucial in bringing competition in a market otherwise dominated by beet sugar processors, yet the lack of supply guarantees in either the European Commission or the European Parliament proposals is jeopardising the future of the refining sector across Europe.

The reform of sugar market should aim at putting in place the necessary structural market management measures as to provide fair terms of competition between the different sweetener producers. Only by fostering a level playing field for all, we will truly achieve a sustainable and competitive sugar market in the EU.

Therefore, should the quota system be extended beyond 2015, a parallel raw cane sugar supply entitlement is needed also. Cane refiners should be allowed fair access to raw material in order to compete. The supply shortages the EU market has suffered in the past years highlight the need to ensure a defined volume of raw sugar is actually imported.

Moreover, an increase of quotas would be an incoherent policy U-turn, which would go against the efforts made in 2006 to reduce the quotas and be clearly detrimental to the full time cane refiners.

Without parallel treatment by legislation, Europe’s cane refiners will face an increasingly unfair situation with regards to access to raw material. This will leave no room for refiners to continue their activity and cane refining factories across Europe would be forced to close thousands of direct and indirect jobs could be lost.

As a consequence this will harm competition and therefore encourage even more concentration of the sugar industry in the EU. This will result in reduced choice and higher prices for the food and drink industry and ultimately European consumers.

ESRA calls upon the EU to shape a sugar market that gives equal opportunities to all. Refiners, users, and consumers deserve it.

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