EU sugar proposals ‘threaten industry’

THE recently published European Union sugar reform proposals are more severe than anyone involved in the Irish industry had expected, Irish Sugar managing director Dr Sean Brady admitted yesterday.

“Indeed, it is fair to say that our worst fears have been realised,” he said, during a visit to Mallow, where the local sugar factory is being upgraded at a cost of €25m, following closure of the Carlow plant in March.

Dr Brady said the severity of the intended cuts and the timeline for their implementation go well beyond what could be considered incremental reform measures. Growers would get compensation equal to 60% of the proposed price cut.

If adopted in their current form they will spell the end of sugar beet processing in many European countries.

Dr Brady warned if these proposals are implemented without any changes they would also undermine the viability of beet growing in Ireland. “This is an unacceptable situation for Greencore Sugar as the possibility of growers exiting the business raises serious questions about the long-term availability of a competitive sugar-beet supply. Without a guaranteed supply, no sugar manufacturing business can survive.”

Dr Brady said Greencore Sugar supports Agriculture and Food Minister Mary Coughlan in her opposition to the current proposals.

“However, we have to accept that radical change to our industry is on the way and this means that we must prepare for that change in the best way we can.

“Preparation in the case of Greencore Sugar means restructuring the business into the leanest most efficient manufacturer possible.

“Like all modern businesses, Greencore Sugar will have to structure itself to be in a position to face competition from EU producers as well as from beyond Europe. At present, these producers enjoy distinct competitive advantages in terms of the cost of beet supply. But we can compete if we work together to achieve maximum efficiency in every area of our operation.

“We must also be a totally customer focused organisation. In the new regime customers are going to deal with the lowest cost, highest quality producers that can deliver on time, every time, to their requirements. We must be among those leading edge producers.

“Only if the Irish sugar industry can demonstrate itself to be world-class will it have a future. To create world-class efficiency in operation will require growers and processors to work together. It is clear that future survival will require further and ongoing cost reductions and efficiency gains. Our future lies in continuous improvement, cost reduction, efficiency improvement and teamwork in order to achieve the necessary improvements,” he said.