Caobisco backs calls for urgent EU measures tackling major sugar price rises
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Caobisco European confectionery trade body has joined urgent calls for EU action on high inflation of sugar prices that are impacting heavily on SME enterprises, with the sector fearing factory closures and widespread job losses, reports Neill Barston.
The industry organisation, which will once again play a key role at our World Confectionery Conference this October in the UK, has echoed a plea from CIUS – which represents more than 15,000 sugar using companies, for import tariffs to be suspended in light of major cost increases.
According to recent analysis, sugar prices within Europe have increased by a staggering total of more than 80% in the past year alone – with such financial pressures being among contributing factors to the delayed timing of the 2023 edition of ISM taking place this week in Cologne, Germany.
As CIUS noted, EU sugar supplies are tightening consistently, and the high-risk unfavourable scenario keeps on repeating itself: sugar supplies between agricultural years (Oct-Sep) are so low that the most vulnerable sugar users (SMEs) face critical shortage situations leading to dramatic economic consequences, such as factory closures and job losses.
Underlining the severity of the problem, stock forecast for 2022/23 shows sugar levels available for users at 552 Tonnes, which represents less than 2 weeks of EU sugar users’ overall consumption.
Furthermore, as CIUS observed, with prices for white sugar in the European Union have reached record highs rallying more than 80% in the last 12 months according to EU Commission published data and continue to rise, supplies remain scarce.
Consequently, sugar users have difficulties to pass on the important price inflation to their customers in the food retail sector, but prices are also acting as a major driver of food inflation, putting a strain on consumers’ budgets wherever this price inflation occurs.
CIUS added: “Our high value-added sugar containing products are losing exports markets as they are unable to compete with operators on the world market.
“As the market currently relies on imports, manufacturers of sugar-containing products have great difficulties complying with weight-based preferential origin rules when exporting to certain third market and thus lose out on any concessions granted in Free Trade Agreements.”
The organisation added that solutions to the situation did exist, but they are dependent on political willingness to act. In its view the suspension of import tariffs would avoid ‘dramatic and irreversible’ economic consequences for the food and drink sector.