6 February 2008

British Sugar welcomes Rural Payments Agency decision

Responding to the news that the Rural Payments Agency (RPA) has accepted British Sugar’s application to renounce quota sugar production on behalf of the UK industry, British Sugar Group CEO, Mark Carr said, “We are pleased that the Government has accepted our recent application. These steps have unfortunately proved necessary following recent modifications to the EU sugar reform regulations, which now require all European industries to renounce quota regardless of their efficiency. Although this will result in the permanent removal of 13.5% of UK beet sugar production, and is contrary to the EU’s original objective to retain the most efficient industries, we believe this to be a necessary step.”

British Sugar, like all other EU sugar producers, has paid substantial levies to the EU to fund the restructuring programme for the European industry. The overall cost of these levies to the company is expected to be in excess of €450 million (£330 million). The restructuring aid received by the industry will offset a proportion of these levy costs and will also contribute towards the restructuring costs associated with the permanent loss of 165,000 tonnes of UK quota production.

British Sugar expects that this latest initiative will be successful in putting the European sugar reform programme back on track, so enabling it to plan and invest more effectively in the industry for the future.

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