EU Sugar Market​

In 2006 a major reform achieved simplification and greater market orientation of the EU’s sugar policy, which is now part of the Single Common Market Organisation (CMO). Income support for sugar beet farmers has been integrated into the direct payment system. EU sugar policy today concerns three main areas: quota management, a reference price and a minimum guaranteed price to growers, and trade measures. The quota management will end as of 30 September 2017.

The total EU production quota of 13.5 million tonnes of sugar is divided between nineteen Member States. Production in excess of the quota is known as “out-of-quota” sugar and strict rules govern its use. It can be exported up to the EU’s annual World Trade Organisation (WTO) limit of 1.374 million tonnes, sold for biofuel or other industrial non-food uses, or counted against the following year’s “quota” sugar. There is also a small quota of 0.72 million tonnes for the competing sweetener isoglucose (also known as Glucose Fructose Syrup). If there are signs that there will be an excess of sugar on the EU market in the next marketing year – which runs from 1 October to 30 September – a decision can be taken to withdraw some quantities. A first “preventive” withdrawal must be decided by 16 March, well before the start of the new marketing year, to allow producers to reduce their beet sowings. If necessary, a further adjustment can be made in October. If, on the other hand, there is a shortage, measures can be taken to increase supplies. Inter-professional agreements between beet growers and sugar manufacturers lay down quality standards and fix purchase terms for beet.

On 12 October 2011 the Commission presented a set of legal proposals designed to make the Common Agriculture Policy (CAP) a more effective policy for a more competitive and sustainable agriculture and vibrant rural areas. The legal proposals included the abolition of sugar production quotas in October 2015. After almost two years of negotiations between the Commission, the European Parliament and the Council, a political agreement on the reform of the Common Agricultural policy (CAP) has been reached on 26 June 2013. Whilst CIUS supported the Commission proposal to eliminate market distorting production quotas in 2015, the European Parliament and the Council favoured an extension of sugar production quotas until 2020. A compromise was found: the end date was set at 1 October 2017. On 16 December 2013 the Council of EU Agriculture Ministers formally adopted the four Basic Regulations for the reformed CAP as well as the Transition Rules for 2014. This follows on the approval of these Regulations by the European Parliament in November. On 20 December 2013 the four Basic Regulations and the Transition Rules were published in the Official Journal.