Broad support for sugar reform, claims Defra

By Anthony Fletcher

- Last updated on GMT

Related tags: European union, Eu

The UK department for environment, food and rural affairs (Defra)
claims that there is strong support for EU sugar reform, though
opinion across Europe remains divided.

The government department, which issued a summary of responses on its consultation into the reform last week, argues that a voluntary restructuring scheme is the best means of achieving change.

Most respondents, which include grower and processor interests, food manufacturing and consumer representatives, would appear to support this belief that a voluntary restructuring scheme is preferable to compulsory quota cuts.

Current reform proposals include a 39 per cent cut to EU sugar prices over two years; something generally expected to hit sugar and sweetener suppliers but bring cost-savings for food and drink producers.

But the controversial plans have spawned an opposition camp, including Poland, Italy Spain, Portugal, Finland, Ireland and Greece, which would be enough to block reform plans in the Council of Ministers and prevent the Commission from making progress before the next WTO meeting.

However, the Defra consultation showed strong support for grower compensation to be fully decoupled, though there was a wider range of views on the way payments should be calculated and the basis for integration into the UK's Single Payment Scheme.

There was a greater polarisation of views on the level of price cut than on any other issue, with a clear distinction between grower/processor interests and those of the food industry and consumers of sugar.

In addition, a clear difference of views emerged between beet processing and existing cane refining interests over future access to supplies of raw cane sugar and the terms of competition for this.

"The existing EU sugar regime is nearly forty years old and is now unsustainable, particularly in the light of other CAP reforms and the EU's international trade obligations,"​ said agriculture minister Lord Bach.

"The government is already on record as supporting a liberalising, market-based approach to reform. The consultation has shown that there is widespread interest in how these necessary reforms are managed.

"The ideas and issues raised during the consultation period will complement the views already put to us by stakeholders in the extensive contacts which have taken place since the Commission outlined options for reform in late 2003."

The proposals for reform of the EU Sugar Regime were published by the European Commission on 22 June 2005. These were designed to bring it into line with other already reformed CAP sectors, as well as helping to meet the EU's existing WTO obligations and providing a platform for further progress on the Doha Round at the Hong Kong WTO Ministerial in December.

The proposals would involve a substantial narrowing of the gap between EU and world prices and a voluntary restructuring scheme to reduce EU production and improve competitiveness.

Separate proposals have been published in order to provide African, Caribbean and Pacific (ACP) suppliers affected by these reforms with adjustment aid under an Action Plan, the details of which remain to be determined on a country-specific basis.

Related topics: Markets

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