French company Tereos, one of the largest sugar producers globally, announced on Wednesday that it expects a 9% decrease in the area used for sugar beet cultivation in Europe next season, citing falling prices across the region as a key factor, reported Reuters.
Driven by increased sugar exports from Ukraine, high production levels, and reduced consumption, sugar prices in the European Union dropped to 541 euros per metric ton in February. This marks a 35% decline compared to the same period last year and the lowest level since September 2022, according to data from the European Commission.
During a presentation at S&P Global’s sugar conference in Geneva, Tereos’ commercial director David Souriau described the decline as a significant development for the sugar industry. He also expressed growing concern over recent sugar mill shutdowns in France, the Czech Republic, and Austria.
While these closures could tighten supply and support a rebound in sugar prices, Souriau warned they may also contribute to increased market volatility, which presents a challenge for the industry.
“Once capacity is shut down, it can’t be restored quickly. These developments raise concerns about price instability, which I see as a critical issue not just this year, but for the foreseeable future,” he stated.
