All recent news from British Sugar
6 December 2023
Dan Green, Agriculture Director, British Sugar said:
“Despite intense negotiations over the past couple of weeks, and despite reaching alignment on the vast majority of commercial terms, we have not been able to reach final agreement with NFU Sugar on next year’s beet contract.
“The only outstanding contract term which is now disputed is around the Futures contract. It is particularly disappointing that an issue which affects so few people – currently just 1% of our grower base - will delay us agreeing an offer which will benefit the vast majority.
“We have improved our offer to include a fixed price option at £40/t, matching the price for the current crop, despite the recent declines in the sugar price and in farmers’ input costs. The following terms in respective parties’ final offers are also aligned:
“The Futures contract is a high-risk product which has only been attractive to a small minority of growers. We have offered to launch it for next year on the same basis as the 2023/24 price. However, the NFU’s insistence on locking in a fixed discount today presents significant risk to both grower and British Sugar.
“As we have said before, we sell almost all of our sugar through fixed price annual contracts and therefore we cannot cover the risks inherent in the futures contract. If we agree a discount factor on the model, both ourselves and the growers who choose it will face greater risk. A small movement in the US dollar exchange rate, or world sugar futures price would present magnified price swings to growers, and potential losses to British Sugar of millions of Pounds.
“Arbitration is time consuming for all and could take between two and three months to finally conclude. So, British Sugar will reopen both the contract and seed order screens on Monday, 18th December so growers can confirm their intentions. More information will follow on this process.”
Growers can also take both price options with or without yield protection, at £1 per tonne. Full options are outlines below:
Options without yield protection:
Options with yield protection: