New one-year sugar beet contract agreed for 2022

National Farmers’ Union (NFU) Sugar and British Sugar have today (Wednesday, September 22) announced a new one-year sugar beet contract for 2022, which includes the continuation of the Virus Yellows assurance scheme and the futures-linked contract.

The one-year contract will pay a fixed price of £27 per adjusted tonne, with current multi-year contracted growers having an option to upgrade to a fixed price of £25 per adjusted tonne by contracting for an additional contract year.

This is an increase of £6.70 from 2021, when the one-year amount per adjusted tonne paid was £20.30.

There will be no separate market-linked bonus. These prices are on a zero-crown tare basis, meaning growers are paid for the entire roots of beet they deliver.

A local premium has also been added for all growers up to 28 miles contracting distance from their nearest factory.

This will start at £2/t for growers up to nine miles, this will then reduce on a linear scale down to 10p/mile up to 28 miles.

The Virus Yellows (VY) crop assurance scheme introduced for 2021 will continue to compensate growers for a proportion of yield losses suffered where a grower has Virus Yellows present in their crop.

This is a three-year, £12 million fund, underwritten by British Sugar covering all new and existing contracts and there are no changes to the terms and conditions.

In addition, NFU Sugar and British Sugar have agreed to continue the innovative futures-linked variable priced contract, giving growers the ability to make their own pricing decisions for a portion of their contract.

Futures-linked contracts will be available for a maximum of 30 days from the contracting window opening. This will now be open to all growers, who will have the option to allocate up to 10% of their tonnage onto this contract.

In a statement commenting on the agreement, NFU Sugar board chairman Michael Sly said: “Following another difficult negotiation, we have finally managed to agree terms with British Sugar.

“The substantial increase in the one-year contract price reflects the increased costs and risk sugar beet growers now face, and recognises the fact that sugar beet must offer returns comparable with alternatives.

After a successful pilot this year, the futures-linked variable priced contract will now be available to all UK sugar beet growers. This contract offers both growers and the processor the potential to lock in attractive prices, meaning all parties can benefit from it.

“Other countries around the EU are starting to follow our lead on this and I am sure that this type of contract will become increasingly common as EU countries modernise their thinking and practices.”

Peter Watson, British Sugar agriculture director added: “We are pleased to be able to share the agreed contract prices with growers after a long negotiation. Our aim was always to agree a fair and sustainable price for all and we believe this is what we have achieved.

Together with our Virus Yellows assurance scheme, the new local premium and the futures-linked contract we believe the contracts offer a competitive package for growers.”

Beet growers who contract with British Sugar online can return their contract offer on the My British Sugar portal. Growers who do not contract online will receive their contract offer in the post.

Contracting will be open by mid-October.