British Sugar reaches deal with NFU over 2019 beet contract

A new sugar beet contract has been agreed Picture: GREGG BROWN

A new sugar beet contract has been agreed Picture: GREGG BROWN - Credit: Archant

British Sugar has reached agreement with the National Farmers’ Union over the 2019 sugar beet contract following protracted talks.

Colm McKay of British Sugar Picture: SU ANDERSON

Colm McKay of British Sugar Picture: SU ANDERSON - Credit: Su Anderson

The NFU said the industry faced “difficult market conditions” as 2019/20 contract terms, were agreed. Both parties said they would help deliver “transparency and certainty” in a highly competitive market as factories and farmers prepared for the new campaign, or harvest, to begin.

The contract price of £19.07/t with no crown tare deduction was equivalent to £20.42/t under the terms and conditions of previous contracts, they said.

The contract, for one year rather than three, includes a 15% - rising from 10% in 2018 - revenue share for growers, above a European Union average white sugar price of 375 euros per tonne, down from 475 euros per tonne in 2018.

British Sugar agriculture director Colm McKay said: “We’re pleased to have reached this agreement with NFU Sugar and believe it will stand us in good stead for the future. Our industry is one of the most efficient in the world and we look forward to continuing to work with over 3,000 growers to produce a quality product.”

NFU Sugar chairman, Michael Sly said: “After a protracted negotiation in the face of difficult market conditions NFU Sugar has reached agreement with British Sugar on improving the simplicity and transparency of contracting which we believe will put the sugar growing industry on a firm footing for the future.”

Late Delivery Allowance payments in each campaign is to be calculated based on the highest guaranteed minimum beet contract price paid during a campaign.

Most Read

Performance rules will be based on either delivering sufficient tonnage or planting a sufficient area of sugar beet.

British Sugar and NFU Sugar also agreed to work together to develop a greater risk/reward contract model which could be piloted in 2020/21. “This is an important step forward in growers having the option to share more of the reward and risk that exists in the sugar market today,” they said.

Both parties said they remained committed to working together to maximise opportunities for “a highly successful homegrown industry”.

The campaign start dates are: Bury St Edmunds and Wissington - September 26, Newark - October 2 and Cantley - October 10.