EC failing to see urgency of sugar shortage in bloc, CIUS

By Jane Byrne

- Last updated on GMT

Related tags: European union

The Commission is failing to recognise the urgency of the sugar supply deficit in the EU in its deferral of a decision regarding the hike in the sugar export quota until January, claims the CIUS, which represents sugar using food and drink industries in the bloc.

Secretary-General of CIUS, Muriel Korter, told ConfectioneryNews.com that the delay in regulatory intervention in regard to out-of-quota sugar leaves the industry in limbo. She maintains that confectionery and other food and drink makers continuing to face production challenges due to the fact there is not enough sugar to cover contracts.

Out-of-quota sugar is production exceeding the quantity of the sweetener that EU regulations stipulate can be supplied for food use in the 27-nation bloc’s domestic market. The Commission announced plans on 11 November to raise the quota by 350,000 metric tons to 1 million tonnes.

The CIUS subsequently called for the application of a negative withdrawal, allowing this volume of sugar to be sold in the internal market, and the body contested the data the EC’s Sugar Management Committee was using in terms of its proposal to increase the export levels of the sweetener.

In a development last Friday, Lars Hoelgaard, deputy director-general of agriculture and rural development, confirmed that the EC has deferred a decision on whether to raise the quota to next year, conceding a “continuous tightness” in supplies.

“I can confirm we have pushed back the decision into next year,”​ Hoelgaard told Bloomberg. “The supply situation on the internal market has to be assured.”

According to the CIUS, even the negative withdrawal intervention would not be enough to resolve the deficit situation on the EU market and it is also seeking the Commission to “consider further steps that may be necessary to ensure that market balances are maintained, such as a temporary tariff rate quota on world market imports.”

Korter said she expects renewed discussions with the EU regulators in early January whereby the CIUS, she stressed, will once again press home the need for swifter action to address the shortfall in the critical food and drink processing ingredient.

In November, Tate & Lyle announced it would be putting up its prices by €176 per tonne from 3 January 2011, as it concluded that, to secure supply, it had no choice but to pay higher prices.

The supplier said white sugar prices across the globe were trading at 50-100 per cent higher than those reported in the EU, so importers and their customers outside the EU were all paying higher prices and attracting sugar to their markets ahead of the EU.

Related topics: Regulation & Safety, Cocoa & Sugar

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