It is reported by Successful Farming.

Global sugar prices are hovering near four-year highs , buoyed by prospects of a large global sugar deficit this season after a poor harvest in top producer Brazil. Prices for ethanol, which can be made from beet sugar, have also surged in the wake of crude oil.

The sugar beet harvest is in full swing in the European Union's biggest producer and is due to last until December.

Sugar beet output is expected to rebound 30% in the country after an extremely poor beet crop last year due to pest attacks that caused yellow disease to ravage crops, the farm ministry said last week.

But a lack of both sun and warm weather led to a lower sugar content than expected and heavy rain just before the harvest soaked beets, which will require more transport and more drying at a time of soaring natural gas prices. Sugar factories are heavy gas consumers.

«Market prices are going up but we really need it and part of this rise will, or at least can, be erased by the sugar content effect and by the gas effect», — Olivier Leducq, European sugar director at France's top producer Tereos, said.

At Cristal Union, France's second largest producer, more than 90% of the gas needed was hedged, the company's deputy director general, Xavier Astolfi, said.

«Higher gas prices will rather have an impact next season», — he said.

Cooperative members of Tereos and Cristal Union together planted about 85% of France's total area of 410,000 hectares (101,310 acres). The agriculture ministry's estimate last week put the French harvest at 34 million tonnes, 30% above last year but 8% below the five-year average.

This was based on yield of 83.4 tonnes per hectare (t/ha), up from 62.2 t/ha a year earlier. Tereos' Leducq and Cristal Union's Astolfi each see the average yield closer to 87 t/h, still below average.

Timothe Masson, an analyst with French sugar beet growers group CGB, raised his estimate for France's sugar output this year by 200,000 tonnes from early last month to 4.4 million tonnes due to warm and sunny weather in mid-September that slightly improved sugar content.

Cristal Union, expects a yield of 13.5 tonnes of sugar per hectare, close to the five-year average. Tereos, the largest producer, said it was too early to give a precise estimate but qualified it as "low".

Before suffering due to heavy rain, beet crops in France had already been hit by severe spring frosts which had forced many farmers to resow their land.

More than 10,000 hectares (24,710 acres) were also destroyed after the use of chemical weeding products that were later declared non-compliant, Tereos and Cristal Union said.

The delay in European sugar prices' rise compared to world prices meant that the two cooperative groups did not fully benefit from high global sugar prices in the first half. But they were confident that would change in price negotiations with clients later this year.

A surge in ethanol prices as energy prices increased should also benefit the two groups, which can switch some of their sugar output between sugar and ethanol to benefit from the best market conditions.