This shift in policies concerning European Union sugar had a direct impact on the operations of Südzucker, who was forced to drastically reduce exports. The company, however, sees great potential in the 4.5 million tons that Europe began to import from global sources. So it was specifically this slice of the pie that Südzucker sought by setting up base in Brazil, a huge player in the worldwide sugar market. Sources within the sector estimate that nearly 69.2% of all sugar produced in the world during the 2010 harvest was consumed internally by sugar producing countries.
Despite the increase in overall worldwide sugar trade from almost 18 million tons in 1990 to nearly 50 million tons in 2010, the sugar sector remains rigidly controlled and protected in various countries by quotas, subsidies and restrictions on imports. These protectionist policies are a result of the strategic value of sugar as a key ingredient in many different foods, as well as being a relatively inexpensive source of energy. Markets in the United States and the European Union, which consumed 9.7 million tons and 18.6 million tons respectively during 2008/09, are heavily protected, sponsored by lobbyists for producers and refineries. Brazil and other sugar producing countries have limited access to these markets because of existing trade restrictions.
Regarding the future, Peter Loomans says that it is difficult to predict government policies. “Growers are not satisfied over all, obviously, because they have a greater potential for production than quotas allow for. Changes will happen, as seen by the quota changes due for 2016, but the current situation should drag on until then.”
Despite the increase in overall worldwide sugar trade from almost 18 million tons in 1990 to nearly 50 million tons in 2010, the sugar sector remains rigidly controlled and protected in various countries by quotas, subsidies and restrictions on imports. These protectionist policies are a result of the strategic value of sugar as a key ingredient in many different foods, as well as being a relatively inexpensive source of energy. Markets in the United States and the European Union, which consumed 9.7 million tons and 18.6 million tons respectively during 2008/09, are heavily protected, sponsored by lobbyists for producers and refineries. Brazil and other sugar producing countries have limited access to these markets because of existing trade restrictions.
Regarding the future, Peter Loomans says that it is difficult to predict government policies. “Growers are not satisfied over all, obviously, because they have a greater potential for production than quotas allow for. Changes will happen, as seen by the quota changes due for 2016, but the current situation should drag on until then.”
Fonte: ProCana Brasil
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