British sweeteners and starches maker Tate & Lyle Plc called for fairer regulation of sugar refining in the European Union, arguing that the current regime leads to windfall profits in the beet sector and big losses in refining.
Gerald Mason, vice president, EU affairs and strategy at Tate & Lyle Sugars, said EU authorities had charged refiners high taxes in auctions to source cane from preferential suppliers. Eight refiners in the EU are affected, including Tate & Lyle.
"They (EU Commission) have created very different terms of competition - very different access to raw material - for two industries (cane and beet) that produce exactly the same end-product in the same markets," Mason told Reuters in an interview on Tuesday.
Sugar supplied to EU markets is either refined from cane imports from preferential suppliers, or from beet grown in the bloc under a system of production quotas due to be phased out. Some beet processors have moved into cane refining in recent years. Tate & Lyle has urged the EU Commission to allow imports free of duty when shortages arise during the period until quotas are proposed to be abolished in 2015. However, the Commission has insisted on taxing cane imports and giving the beet industry a fair share of any shortfalls.
Mason said it was not sustainable for the cane industry to be regulated in a different way from the beet industry. Tate & Lyle's Thames refinery in London, which has operated for more than 130 years, recorded a 37 million euros ($48 million) loss in the last financial year, due to its high costs of production. The F.O. Licht Sugar Trade Outlook conference took place on the sidelines of London Sugar Week, which gathers several hundred traders from around the world, culminating in the London sugar trade dinner on Thursday.