UK farmers’ union accuses sugar producer of short-changing growers

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Britain’s farming union has accused the country’s only sugar processor of trying to short change sugar beet growers, weeks after global prices for the commodity surged to a 12-year high.

Talks between the National Farmers’ Union and British Sugar to set the price paid to sugar beet growers had reached a stalemate before descending into acrimony last week, when the processor went directly to growers with an offer that had not been agreed by the union.

The NFU said it was “outraged” by British Sugar’s “aggressive” act, and accused the processor, a subsidiary of Primark-owner Associated British Foods, of attempting to deny farmers their fair share of profits. 

In a letter to members, the union said British Sugar hoped “that individual growers will accept a contract that gives them significantly less value than we believe you should receive”.

As the sole buyer and processor of UK sugar beet, British Sugar is compelled by retained EU regulation to agree the terms governing beet pricing every year with the NFU, the statutory representative of all growers.

Sugar prices have hit their highest level since 2011 in recent months after extreme weather and a warming climate threatened yields, leaving growers with hopes that they would pocket a share of the higher profits.

“When the global market was low, everyone grew the crop and shared the pain,” said Michael Sly, chair of the NFU’s sugar board, which is representing the union in the talks. “Now that we are in the territory of the higher market, there should be fairness in how we share that gain.”

The industry’s 2,300 growers are based primarily in the east of England, the East Midlands and Yorkshire. The sugar produced from their beets — in a process that involves extracting sucrose before purifying and crystallising it — makes up about half of the UK’s total sugar consumption. A large share of the sugar is sold under ABF’s Silver Spoon brand.

British Sugar said that “despite [its] best endeavours” it had not been able to agree a price with the NFU, so it had made an offer to growers who were anxious to establish their crops plans for spring 2024. 

“We will continue to work through the negotiation and dispute resolution process with them,” said Dan Green, British Sugar’s agriculture director. “However, we know that as we are now at the start of November, growers need the financial security of a contract . . . as soon as possible.”

In its offer, British Sugar assured growers that even if they signed a contract now, it would allow them to move to terms set by the NFU once a deal had been struck.

But the NFU said it would return to talks only once British Sugar had withdrawn the offer made to growers “outside of the established process”.

The government this week told both sides to return to talks after the NFU called on farming minister Mark Spencer to intervene. 

In a statement, the Department for Environment, Food and Rural Affairs said there was “a well-established process in place to agree the sugar beet price . . . with government only acting as final arbitrator at the end of the process should no agreement be reached”.

It added: “It is very important that all parties involved now continue to follow that process and reach a mutually acceptable outcome.”