GLOBAL – The Federal Association of the German Confectionery Industry (BDSI) has urgently called for reforms in the EU’s sugar policies to maintain the competitiveness of medium-sized companies, while confectioners in the US grapple with a restrictive sugar program.

According to the EU Commission’s data, sugar prices have surged, reaching an all-time high, with an astonishing 80% increase compared to the previous year recorded in June 2023.

Despite a projected 6% increase in sugar production to 15.5 million tonnes, BDSI argued that this figure falls significantly short of covering the demand of European consumers and the food industry, which requires 17.5 million tonnes.

Germany’s export-oriented confectionery industry is facing a dual challenge, with not only rising sugar prices but also increased energy costs, making international competition a daunting prospect.

The heart of the issue lies in the heavily sheltered sugar market with its protective tariffs. Import quotas, a few of which are allowed by the EU, favor European sugar suppliers and do not address the broader market dynamics.

Critics contended that the European sugar industry primarily focuses on additional refining to extend the sugar campaign rather than alleviating market pressures.

The BDSI emphatically advocated for a more market-oriented approach, considering climate change’s impact on European sugar beet cultivation, and suspending high protective tariffs to facilitate sugar imports from other global regions.

“In this extremely tense situation for the confectionery industry in Germany and the European Union, the EU Commission must finally act and open the European market for white sugar imports in the short term,” Bastian Fassin, Chairman of the BDSI emphasized

“Despite the high sugar prices, the EU’s sugar production is still far too low, and the supply situation is at risk. This clearly shows that this is not possible without further import quotas or the suspension of the protectionist EU protective tariff.”

Alongside these immediate measures, BDSI highlighted the necessity for a long-term realignment of the EU sugar market.

In April of this year, the Confederation of the Food and Drink Industries of the European Union (CIUS) echoed these concerns, citing a loss of competitiveness for sugar users and emphasizing the impact of rising sugar prices on consumers.

The issue of high sugar import tariffs is not unique to Europe. In the United States, the sugar program is causing shortages that could disrupt confectionery and candy production, especially as the Halloween holiday season approaches.

US candy producers attributed the problem to agricultural policies demanding 85% of domestic sugar purchases to originate from domestic processors, resulting in constrained supplies and elevated prices during periods of high demand.

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