British Sugar has written to its 2,300 sugar beet growers to supply them a value of £38/t for the 2024-25 rising season – though value negotiations are nonetheless not concluded with the NFU.
The 2 sides have been at loggerheads over an appropriate value for subsequent 12 months’s crop for months. They not too long ago appointed an unbiased arbiter from the Centre for Efficient Dispute Decision to assist in the method.
See additionally: NFU Sugar and British Sugar appoint arbiter in value dispute
However, with the clock ticking, British Sugar agriculture director Daniel Inexperienced has now made a proper contract supply to growers, suggesting this may supply “the monetary safety of a contract and the knowledge of a assured value as quickly as doable”.
“Following important strain from growers, we now have determined to give you the selection to contract with us now and lock in your seed for subsequent 12 months, while we proceed the negotiation and dispute decision course of with NFU Sugar,” he wrote.
The deal, ought to growers determine to simply accept it, features a market-linked bonus, which might robotically take the core value to £40/t, ought to as we speak’s sugar costs be maintained subsequent 12 months.
Different parts of the supply embrace:
- A yield safety product to mitigate towards threat (for £1/t)
- A 20% money advance to ease cashflow in the midst of the 12 months
- A late supply allowance to growers who select to ship after Christmas
- Free frost insurance coverage cowl
The letter provides that, ought to the business phrases in the end reached with the NFU be higher than these British Sugar is now providing, growers could have the appropriate to maneuver to these new phrases.
But when the ultimate phrases are value much less, then British Sugar will nonetheless follow the £38/t it’s providing now.
‘Outrage’
Despite this, NFU Sugar says it’s “outraged” that BS ought to make any such contract supply at such a fragile stage of negotiations.
“NFU Sugar has not agreed this supply, leaving the validity of any contracts made in relation to this supply unsure,” mentioned chairman Michael Sly.
At £38/t, the provided beet value is lower than growers are receiving for the crop being lifted now.
British Sugar says that is justified and grower manufacturing prices have come down since final 12 months.
However the NFU has pointed to the agency value of sugar proper now and the great margins the processor is having fun with.
