Sugar bosses optimistic amid a raft of farming challenges
PUBLISHED: 07:00 24 November 2018 | UPDATED: 08:43 24 November 2018
With East Anglia's sugar campaign in full swing, a senior industry figure is optimistic for this year's beet crop - and confident the sector can ride out its future challenges of market pressures and the loss of protective chemicals.
Colm McKay, agriculture director at British Sugar, said almost 40pc of this season’s beet has now been harvested, and early results had allayed some of the concerns from earlier in the season, when a wet spring delayed drilling, and a summer drought hampered growth.
While yields won’t top last year’s records, he expects they will be better than initially feared, with good sugar content – currently averaging around 18pc at Cantley, one of the firm’s four factories in the East of England.
But aside from the immediate challenges of the weather, there are longer-term factors at work.
Mr McKay said his industry was anxiously waiting to see if Brexit trade negotiations will bring a “level playing field” to allow East Anglia’s growers and processors to compete with more highly-subsidised sugar producers from other parts of the world.
Meanwhile, a combination of lower prices and the extension of an EU ban on neonicotinoid pesticides have caused some growers to re-think their cropping, including Essex farmer and NFU deputy president Guy Smith, who said last week he would not be growing sugar beet next year, adding: “I’m probably not the only farmer who’s going to walk away next year”.
But Mr McKay said: “I think there is still a high level of commitment to the crop in this part of the world. It is a cornerstone crop of rotations within the area because not only does it deliver good returns, but all the rotational benefits too.
“I am confident about the future of the industry. The industry has been here for more than 100 years and I see no reason at all why that is not going to continue for the next 100 years and beyond.
“We are in challenging waters right now, but with our growers we will work our way through that, as we always have.”
On the subject of beet contracts, Mr McKay said there had been “some confusion” over the lower 2019/20 price of £19.07 per tonne, which was negotiated on the basis of nil reduction for crown tare, so it actually equates to £20.42 per tonne when compared like-for-like with previous years.
“If growers want to compare their sugar beet price with previous seasons, they have to look at £20.42 – but I would also say to remember that is a minimum guaranteed price,” he said. “There is also market linkage to that price so when the sugar market rises above 375 euros per tonne, the growers will share in the benefit of 15pc of the revenue above that figure.”
Another challenge facing the sugar industry is the EU’s decision earlier this year to extend the ban on neonicotinoid pesticides to all outdoor crops.
“Clearly this is a significant threat to the crop,” said Mr McKay. “However, we and our growers jointly invest £2m a year in the BBRO (the Norwich-based British Beet Research Organisation) which is leading on the mitigation strategies to help our growers deal with the issue.
“Currently we will have access to one spray of a plant protection product which will help, but what is critical is the timing of that spray, which the BBRO team will be advising our growers on at the appropriate time of year.
“Longer term, we will also be working with the BBRO on alternative methods of control, which will include working closely with seed breeders to see how quickly we can move towards a world where we have seed varieties that are resistant to virus yellows.
“Yields of sugar beet have increased by 25pc in the last ten years, and 50pc in the last 30 years. There is no reason why the yield advancement seen in sugar beet cannot continue for many years to come. Clearly the lack of neonicotinoids is something that could start to challenge some of that, but we are working closely with BBRO to come up with strategies to deal with that.”
Mr McKay said British Sugar had invested £250m in the efficiency and reliability of its four factories in the last five years, including automating part of the packing plant at Wissington, near King’s Lynn, due to be completed early next year, and a £7m investment in presses at Cantley, near Acle, to improve the quality of Limex – a by-product of the sugar-making process which is supplied back to farmers as an agent to correct soil acidity.
“So, growers will see the direct benefit of that investment, and it will also help the throughput and the general operation of the factory,” he said. “That should be up and running in December.”