Since acquiring African sugar processor Illovo in September last year, the business has made a strong contribution to overall profits. The deal extended ABF's reach worldwide and joined a portfolio which includes beet sugar operations in the UK and Poland as well as cane sugar processing in China. ABF's first foray into the African continent, the acquisition will contribute to ensuring full year profits are in line with previous forecasts and, along with the remainder of the company's sugar sector, will go some way towards offsetting a poor performance last year from ABF's grocery business. ABF, who own the UK's largest sugar processor, British Sugar, said in a trading update released yesterday profits from its sugar businesses were well ahead of last year and the company is on line to hit its UK sugar quota and biofuel production with a crop of 1.15 million tonnes. ABF said: "UK sugar prices have stabilised but profit was lower as a result of the temporary quota cut and the cost of the restructuring levy being in excess of reduced beet costs. These were mitigated in part by the additional quota acquired, a very efficient campaign and lower energy costs." A large crop in China, a strong campaign in Poland and higher world sugar prices also contributed to the company's overall performance. Sugar producers have welcomed the EC's recent decision to introduce a temporary quota reduction of approximately 2 million tonnes of sugar for the 2007/08 campaign. The reduction is designed to bring down the massive sugar surplus in Europe, which is a result of the voluntary quota renunciation under the EU restructuring fund being far from the expected level.