USDA semi-annual review of EU sugar regime

According to the USDA FAS semi-annual review of the EU sugar regime, released on October 15th 2003, in 2003/04 EU 'A' and 'B' quota sugar production was reduced by 215,000 metric tonnes to 13.44 million metric tonnes, in order to meet WTO export-subsidy constraints. In comparison, the quota was reduced by 862,475 metric tonnes in 2002/2003. The difficulties this could otherwise have created were eased by the hot and dry summer which reduced estimated sugar production to 16.86 million metric tonnes, an 8% reduction from the 18.4 million tonnes produced in 2002/2003, mostly as a result of the 7% drop in area planted to sugar beet. According to the USDA in 'Spain, Italy and France output fell 22%, 27% and 10% respectively, due to a combination of reduced area planted to sugar beet as well as poor yields'. EU export forecasts for 2003/2004 were reduced by 0.5 million tonnes to 4.9 million tonnes. EU export subsidies as of September 12th 2003 were approximately € 431/tonne for raw sugar and € 476/tonne for white sugar. According to the USDA 'in 2001/2002, just under € 1.5 billion ( € 1.493bn) were used to subsidise the export of 3.488 million tonnes of sugar at an average rate of € 428/tonne (averaged across all types of sugar export refunds). For 2002/2003, provisional figures show 3.133 million tonnes of sugar exported with the benefit of export subsidies at an average subsidy of € 467/tonne, giving a total expenditure on sugar export subsidies of € 1,463 million. In terms of imports for 2003/04, the maximum supply needs of EU refineries were reduced by 2,392 tonnes to 1,774,074 tonnes white sugar equivalent. Formal proposals for sugar-sector reform are expected during the first half of 2004. The USDA analysis maintains that it is unlikely that any reform package can be finalised and approved before the end of 2004. This suggests that 'the new sugar regime, should agreement be reached, is likely to enter into force in 2006'. Comment: With difficult weather conditions reducing EU sugar production and a gradual reduction of 'A' and 'B' quotas underway, decisions on sugar-sector reform could become slightly easier.

Bibliographic Details

Main Author:	Technical Centre for Agricultural and Rural Cooperation
Format:	News Item biblioteca
Language:	English
Published:	Technical Centre for Agricultural and Rural Cooperation 2003
Online Access:	https://hdl.handle.net/10568/52834 http://agritrade.cta.int/Back-issues/Agriculture-monthly-news-update/2003/December-2003
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