Confectionery companies in both the European Union (EU) and the United States (US) are increasingly concerned about the high sugar tariffs and restrictive sugar programs that they are facing. These policies have led to soaring sugar prices, with no relief in sight for the upcoming sugar marketing year beginning on September 1st. Small and medium-sized confectionery manufacturers are particularly feeling the pressure.
The EU market, protected by tariffs, is facing a significant price increase, reaching an all-time high. In fact, the price of sugar rose by over 80% compared to the previous year. Despite the European Commission’s expectations of a slight increase in production volume, the Sugar Industry Association (BDSI) argues that it is still not enough to meet the demand of consumers and the food industry within Europe.
Notably, Germany’s confectionery industry, which heavily relies on exports, is especially weakened by the surge in sugar prices and rising energy costs. The BDSI has criticized the structure of the European sugar market and emphasized the need for reforms that prioritize market orientation, consider climate change in sugar beet cultivation, and suspend the high protective tariffs to allow imports from other regions.
Immediate action is necessary to address the shortage and price inflation of sugar. The BDSI urges the EU Commission to open the European market for white sugar imports, temporarily suspending the protectionist tariffs. It is clear that increased sugar prices have not resulted in sufficient domestic production, making import quotas essential for the industry’s stability and preventing a supply crisis.
Furthermore, the BDSI emphasizes the need for long-term realignment of the EU sugar market. Meanwhile, CIUS, representing the European sugar-using food and beverage industries, has also called for urgent political measures to address the current market situation, including the suspension of import tariffs on white sugar.
The problem of high sugar import tariffs extends beyond Europe. The US sugar program, requiring a majority of domestic sugar purchases to come from domestic processors, is causing similar shortages and high prices for confectionery companies. This issue is particularly critical ahead of the Halloween holiday season. The National Confectioners Association (NCA) asserts that the current agriculture policy puts American businesses at a competitive disadvantage, paying twice as much for sugar compared to foreign competitors. Therefore, the NCA advocates for changes to the sugar program to increase supply during periods of high demand.
In conclusion, the high sugar tariffs in the EU and the US sugar program have raised concerns for confectionery companies. The industry is grappling with soaring sugar prices, which are putting significant pressure on small and medium-sized manufacturers. Urgent action is needed to address the shortage and price inflation, including the suspension of import tariffs and long-term reforms to ensure market stability.