Overcast

Overcast

max temp: 15°C

min temp: 10°C

ESTD 1874 Search

Growers’ anger as beet price drops

14:00 26 July 2014

A sugar beet crop

A sugar beet crop

Archant

East Anglian sugar beet growers have expressed anger and resignation at a deal which will see crop prices fall significantly next year.

shares

British Sugar, which has plants throughout East Anglia including at Bury St Edmunds, and the National Farmers’ Union (NFU) have agreed a price of £24 a tonne for contract beet in 2015/16 - 24% below the current price of £31.67 a tonne - against a backdrop of falling commodity prices and high sugar stock levels.

Farmers are being told that commodity prices have fallen significantly from the peak levels of 12 months ago, including in the European Union. Following a larger-than-anticipated crop last campaign and very good prospects for the crop in the ground now, sugar stock levels have reached an unprecedented high which means the area of planting needs to be reduced for the 2015/2016 campaign.

But despite the current surplus, growers have warned that the company could see a shortfall if more farmers than expected decide to turn their backs on the deal.

The agreement between British Sugar and the NFU includes an enhanced transport allowance, which is worth around £1 a tonne, and the company is offering growers a contract holiday, so they can grow less than their quota while still retaining full entitlement for 2016/2017, but growers are still unhappy.

John Collen, who grows around 3,000 tonnes of beet at his farm at Gisleham, near Lowestoft, said he was unlikely to grow the crop next year and was currently looking at alternatives. He argued that the potential damage to the soil and to the yields in follow-on crops should be reflected in the price and added that farmers were feeling “very, very bruised”.

“It’s an appalling deal,” he said. “I have yet to find anybody who thinks this is anything but a kick in the teeth.”

He added: “I can’t profitably grow beet at £24 a tonne myself. Some of the best land that grows 80 plus tonnes per hectare of beet might be able to make it stack up.”

Bill Baker, who farms at Drinkstone, near Bury St Edmunds, who grows about 350 acres of the crop, said he was “disappointed” but would be “doing some sums”. He expected to continue to grow sugar beet next year, although possibly on a reduced scale. Overall, with the transport agreement, he believed it would represent a drop in price of 21% which was about in line with the fall in prices of other crops.

“All the trump cards are with the purchaser,” he said. “I’m unhappy about the price drop. I’m unhappy about the price drop in all commodities, but you have to be realistic.”

The NFU and British Sugar have agreed to work together on further improving the efficiency of the sugar beet delivery supply chain, and to explore whether a beet pricing option that is linked to the sugar market place could be available to growers in the future. This work should be completed by the end of the year.

“EU sugar sales prices have been falling as a consequence of the exceptional measures taken by the European Commission to increase the availability of quota sugar in the EU, combined with heightened competitor activity as the industry looks ahead to the reform of the sugar regime at the end of September 2017,” a letter to growers explains.

“In light of the extremely competitive market place it is essential we all work together to ensure a sustainable and competitive future for the industry.”

The price achieved is described as “providing a good gross margin for those achieving an average yield, in comparison with alternative crops

at current prices”.

The price for surplus beet will not be announced until nearer to sowing but the letter warns that due to the current levels of excess stock, the surplus beet price is expected to be “significantly below” the price levels in recent seasons.

NFU sugar board chair William Martin, who farms at Littleport, near Ely, and supplies British Sugar’s Wissington plant, described it as “a fair deal”.

He admitted it was a big drop, but pointed out it was in line with the falls seen in other crops.

“We try and be as forceful as we can, but we can’t push water uphill and if markets are against us there’s little we can do,” he said. “Over the last five years it has been below this price only once four years ago. This is the bottom end of the range, but it’s within the range.”

But he added that the crop ‘holiday’ option and transport deal were important concessions for growers. The deal for this year’s crop was reached at a time when commodity prices were much firmer and other cropping options more attractive, he pointed out. The fact that British Sugar was having to cut the national crop by 20% was also an important factor, he added.

He expected that overall growers would be disappointed but realistic about the price drop.

“What I would expect is overall realism. Disappointment that we have not managed to buck the trend more, but realism that this does represent where things are,” he said. “We live in a market economy and this is the market functioning, unfortunately.”

Colm McKay, agriculture director at British Sugar, said: “We are pleased that after months of detailed discussions with the NFU, we have reached agreement on the terms and conditions for the 2015/16 beet crop. The package of proposals demonstrates both British Sugar’s and the NFU’s continued commitment to work together to deal with the challenges the industry is facing, agree a beet price that enables sugar beet to compete in rotations on farm and British Sugar to compete in an increasingly competitive market place.”

shares

0 comments

Welcome , please leave your message below.

Optional - JPG files only
Optional - MP3 files only
Optional - 3GP, AVI, MOV, MPG or WMV files
Comments

Please log in to leave a comment and share your views with other East Anglian Daily Times visitors.

We enable people to post comments with the aim of encouraging open debate.

Only people who register and sign up to our terms and conditions can post comments. These terms and conditions explain our house rules and legal guidelines.

Comments are not edited by East Anglian Daily Times staff prior to publication but may be automatically filtered.

If you have a complaint about a comment please contact us by clicking on the Report This Comment button next to the comment.

Not a member yet?

Register to create your own unique East Anglian Daily Times account for free.

Signing up is free, quick and easy and offers you the chance to add comments, personalise the site with local information picked just for you, and more.

Sign up now

St Edmundsbury and Forest Heath councils have been urged to fine irresponsible dog owners for not picking up after their pets

St Edmundsbury and Forest Heath councils have been criticised after it was revealed neither has issued a fine for dog fouling over the last three years.

Gemma Edgar was diagnosed with a brain tumour last year. She has undergone treatment and is now raising awareness and money for brain tumour research. Gemma is pictured at home in Colchester with her husband, Rob, and sons Dylan (3) and Noah (9 months).

Gemma Edgar will begin drawing a pension aged just 29 after being forced into retirement from ill health.

Colourful houses on Aldeburgh seafront, Suffolk

One of Suffolk’s most famous resorts was the third best-performing coastal town for house prices in Britain last year, a survey has shown.

Abellio Greater Anglia train.

Abellio Greater Anglia has attracted more negative Tweets than any other rail service provider on routes to London, according to latest statistics.

Paul Nixon has organised the Bergholt Bomb Along bike ride in aid of the Alzheimer's Society.

Hundreds of fundraisers took part in a second-annual charity bike ride raising cash for the Alzheimer’s Society today.

The sign nailed to a bench in Hadleigh aimed at Brian Riley, who has moved to the US but is continuing as a Suffolk County Councillor

An attempt at making an amusing political statement has left a lasting mark – but not a welcome one.

Lloyd Thornton was jailed for 42 months for sex offences. Picture: Norfolk Constabulary

The former hotel manager from west Suffolk has been jailed for 42 months for groping four young women after making inappropriate sexual comments to them.

The man was in a four-man rowing boat on a round-the-UK trip when he fell ill around six miles off Brightlingsea in Essex at around 2.40am on Sunday.

A man suffering from seasickness was in hospital over the weekend after being rescued by coastguards.

Suffolk FA Grassroots Festival at Gainsborough Sports Centre in Ipswich.
Cornard Dynamos v Beccles.

Football fanatics from across Suffolk kitted-up for one of the biggest youth sporting events in the county, as they took part in the Suffolk FA Grassroots Festival.

An architects impression of the proposed new look for Ipswich Cornhill

Redevelopment hopes for Ipswich Cornhill have received a major shot in the arm after Suffolk County Council’s new spokesman for the town pledged to match the borough’s £800,000 investment.

Most read

Most commented

Topic pages