Nordzucker Post 3/2024 - 25 July 2024

EU sugar market normalises

‘Looking at the price trend, it is clear that the 2023/24 financial year really is a very exceptional year. We were able to benefit very significantly from the high sugar prices and more than compensate for increased costs,’ explains Alexander Godow, COO at Nordzucker.

The normalisation in the sugar market is initially being driven by declining consumption due to generally high prices. The inflation of recent years has caused food prices to rise sharply; people are buying more carefully, substituting and avoiding leftover food. At the same time, the pressure on sugar stocks is growing due to good yields and increased acreage in the EU. Around 500,000 tonnes more sugar were produced in 2024 than in the previous year and sugar production in the EU is expected to increase again in 2025. Imports from Ukraine are also having an impact on the price trend, but the main reason for the falling prices is volume growth within the EU.

‘In this situation, it is important to act in a market-orientated manner and not produce sugar in excess of demand. Many of our growers have subscribed to free volumes for the 2025 cultivation year. We are pleased with the high level of willingness to grow beet. However, the total quantity subscribed significantly exceeds our requirements. In line with the planned capacity utilisation of the factories and optimised freight costs, we have therefore unfortunately had to turn down volumes even at very short distances from some of our factories,’ explains Lars Gorissen, CEO.