Südzucker Group contributes to sugar market reform

Mannheim, 03.03.2008

By fall of 2007, insufficient progress had been made on the 6-million-tonne reduction in European sugar production quotas called for by the sugar market reforms dated July 1, 2006. In October 2007, the commission therefore increased the incentives to renounce sugar quotas. This resulted in additional quota returns of about 2.6 million tonnes by January 31, 2008. The total amount reduced, including the quotas already renounced for the 2007/08 sugar year, is now 4.8 million tonnes, leaving a further 1.2 million tonnes to be surrendered to reach the targeted cut of 6 million tonnes.

Had the commission decided upon a preventive market withdrawal for the upcoming sugar year 2008/09 as it did the prior year, a further step would have been taken to achieve market equilibrium. Südzucker regrets that the commission did not take this step.

During a "first wave" of talks, the Südzucker Group reached agreement on returning a good 15 percent of its quota throughout the group, which is equivalent to about 650,000 tonnes. The percentage surrendered in Germany, Belgium, Poland and Austria was about 13.5 percent, in France about 20 percent, in Slovakia about 10 percent and in Hungary about 30 percent. No quotas were cut in the Czech Republic or Romania.

As a result of the commission's recent announcement on existing quota returns, which are voluntary at this time, the Südzucker Group is presently engaged in a "second wave" of intensive discussions with beet farmers and employee representatives regarding possible additional quota reductions.
This initiative would enable the Südzucker Group to make an additional contribution to the EU-wide quota reduction of 6 million tonnes of sugar called for by the commission.

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