SUNBIZ

Uncertainty Increases European Premium Price For Sugar

Sugar sales now to these markets in Europe will earn FSC around USD$20 per tonne more than the Asian markets and USD$30 more than the premium price of sugar in Europe when the season started.
27 Jul 2019 11:31
Uncertainty Increases European Premium Price For Sugar
Fiji Sugar Corporation chief executive officer Graham Clark at the sugar terminal at Lautoka Wharf on July 26. Photo: Charles Chambers

The premium for sugar in Europe and the Northern Hemisphere has suddenly increased, prompting the Fiji Sugar Corporation to change strategies on the sale of its sugar.

This uncertainty in sugar supplies is expected to carry on until next year which will put FSC and Fiji on a good footing with expected premium increase for sugar.

Sugar sales now to these markets in Europe will earn FSC around USD$20 per tonne more than the Asian markets and USD$30 more than the premium price of sugar in Europe when the season started.

Initially with the premium price in the European markets at USD$50 per tonne, FSC had looked to the Asian continent to sell a good part of its sugar at a good price.

The change in the price of sugar in the European markets was because of the uncertainty of sugar supplies.

“What’s brought about this change was that supply constraints which were being caused by a low season of production in Europe. So buyers in Europe are trying to get as much sugar in stock as possible.”

Mr Clark said because of this the premium, which is the European delivery price, has been pushed higher.

“What we usually do is price all the sugar of the same terminal on the world market and negotiate a premium.

“So the premium in Europe now is around USD$80 per tonne while the price in the Far East is around USD$60 per tonne.

“So that extra USD$20 will come back to Fiji along with a good rate for fright which we have negotiated with this brand new vessel.

Meanwhile Mr Clark said the shipping season has started and will carry on until the end of the year.

Mr Clark said a total of six vessels would be used to transport Fiji’s sugar, this year estimated to be 190,000 tonnes to markets around the world.

First shipment

The first shipment, which began loading at Malau in Vanua Levu last week would be headed to Southern Europe or the UK.

The six shipments would include markets in Spain and the United States.

The first shipment will be 34,000 tonnes in sugar with 9000 tonnes already loaded from Malau.

“We are also prepared for the loading of the second vessel.”

Feedback: charles.chamber@fijisun.com.fj

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