British Sugar and Beet Farmers Set Talks for 2014-15 Crop Price

The U.K.’s National Farmers Union and British Sugar Plc, a processor owned by Associated British Foods Plc, will meet next week to negotiate the 2014-15 sugar beet price, which may affect the size of the crop.

NFU Sugar, which represents 3,500 farmers, rejected on June 14 an offer of 30.67 pounds ($47.54) a metric ton from the country’s only beet sugar processor for next year’s crop. That compares with 26.51 pounds a ton a year earlier. Talks were held after the offer and no agreement was reached, according to the NFU. More negotiations will be held next week, British Sugar said by e-mail.

“Discussions will take as long as they take,” William Martin, chairman of NFU Sugar, said by phone. The original offer was too low as harsher winters and longer processing campaigns have made the crop more risky for farmers. They may shun beet for other crops if they don’t get a fair price, he said yesterday.

British Sugar’s objective is “to pay a fair and competitive beet price” to growers without undermining competitiveness, Colm McKay, agriculture director, said in an e-mailed response to questions from Bloomberg on Aug. 6.

“These prices will deliver a significantly positive margin in favor of beet versus the alternatives,” McKay said. “With alternative crop prices falling, that margin is increasing further.”

The NFU’s Martin said he was “confident” an agreement would be reached.

The U.K. is forecast to produce 1.18 million tons of sugar in the 2012-13 season, estimates the European Commission, the European Union’s regulatory arm. That places the country as the fourth biggest producer in the EU after France, Germany and Poland. The 27 member countries included in the forecast are expected to produce 17.6 million tons.

The International Sugar Organization in London estimates there will be a record global sugar surplus of 10 million tons in 2012-13.

The NFU declined to give a specific date for the negotiations and British Sugar was not immediately available to comment on the date.

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