South German sugar beet growers’ association VSZ said on Thursday it will not support plans by French farmers to make a purchase offer for two sugar factories that Germany’s Suedzucker is planning to close in France.
A crisis in the sugar market after the European Union abolished production quotas in 2017 prompted Suedzucker, the EU’s largest sugar refiner, to announce a plan to cut capacity by 700,000 tonnes and close five sugar production units.
Under the plan, it would stop production at two sites of its French branch Saint Louis Sucre next year.
This prompted French sugar beet growers group CGB to devise an offer through which farmers would take over both of Saint Louis Sucre’s sites for 30 million euros ($33.6 million), its chairman Franck Sander said.
But VSZ, which represents the interests of majority shareholders in Suedzucker, rejected the proposal after meeting CGB representatives on Wednesday.
“The VSZ continues to support the plan by Suedzucker management to close the two French factories,” said VSZ chief executive Fred Zeller.
“The sugar industry is in a painful restructuring process. Some capacity must be removed to support the European sugar market and to achieve realistic prices and remove over-capacity.”
French beet growers said they would not give up their fight after Suedzucker asked them to submit a formal proposal.
“They did not close the door,” Sander told Reuters. “We will continue our work like we had planned to.” ($1 = 0.8918 euros)
By Michael Hogan and Sybille de La Hamaide
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