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French sugar maker Tereos expects this summer’s extreme heat and drought to reduce its growers’ sugar beet yields by more than 20% compared with last year, contributing to an anticipated 38-year low for EU sugar output.
Sugar beet is among summer crops, such as maize and potatoes, to have suffered badly from extreme weather in Europe.
Tereos said beet yields for its French growers were also expected to be about 15% below the average of the past five seasons.
In response to the weather-hit crop, Tereos plans to shorten its sugar production campaign at its eight French factories to 100 days on average compared with 130 days last year.
Tereos will also delay the start of the campaign to allow beet crops to potentially gain some yield.
Tereos said sugar prices were recovering after two years of decline, which had led to lower profits for the company and European rivals.
The expected tightening of supply and a decline in planting should help the market rebalance.
«Today, we are seeing the first signs of a rise in sales prices, which should enable the sector to return to a more balanced level of performance», — Pierre-Henri Dietz, Tereos’ commercial director, said in the statement.
In a joint statement on Tuesday, Tereos and other French producers warned that sugar beet production could be more than 20% below average, with the impact of heat and drought exacerbated by pest and disease pressure.