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EU may import sugar at world prices for chemicals, biofuels

The European Union's farm chief will press the bloc's governments tomorrow to approve extra sugar imports, arguing that producers of chemicals, drugs and biofuel can't obtain enough of the sweetener at world market prices.

Chemicals companies ferment sugar to derive products such as ethanol and biobutanol. The sweetener also has a range of uses in drug production, including making enzymes. ”The chemicals industry has told us it has been unable to get sufficient supplies of sugar at world market prices,” Michael Mann, spokesman for Agriculture Commissioner Mariann Fischer Boel, said by telephone from Brussels. „That is why we are proposing expanding the quota for sugar imports.” While the EU guarantees a minimum price to sugar beet farmers and manufacturers such as Tate & Lyle Plc and Suedzucker AG, the bloc's production exceeds the quantity it subsidizes. The EU has reduced the amount of unsubsidized sugar for export to comply with a 2005 WTO ruling. The glut of cheap sugar was promised to chemical, drug and biofuels makers, who now say they can't find enough of it. The extra quota will be roughly 200,000 tons and will last until September, Fischer Boel told agriculture ministers on Tuesday. Her proposal will be discussed at today's sugar management committee and formally proposed at its first meeting next year. The panel can only block a proposal by mustering more than two-thirds of the votes, which are weighted by country according to size. Such defeats are „very rare,” Mann said. (Bloomberg)