British Sugar revenues rise as global demand outstrips supply
- Credit: Eastern Daily Press © 2015
British Sugar owner Associated British Foods (ABF) said revenues across its sugar business are running 38% ahead of last year, or 22% when adjusted for currency variations.
In a trading update for the 16 weeks to January 7, ABF said that higher sugar prices, increased production in Africa and efficiency improvements had delivered a substantial increase in profit.
World sugar prices are currently well above the levels of a year ago, with 2016-17 forecast to be a second consecutive year of global production below demand.
ABF said a tightening of EU stock levels had strengthened domestic prices across Europe while in Africa higher world prices and the strength of the US dollar had resulted in higher domestic and regional prices.
In the UK, production is projected to be just under 900,000 tonnes due to a smaller beet crop and yields marginally lower than last year.
However, with higher prices and a weaker sterling/euro exchange rate, British Sugar's full year operating result 'will improve substantially', ABF added.
British Sugar has factories at Bury St Edmunds, Cantley near Norwich, Wissington near King's Lynn and Newark in Nottinghamshire.