Investing.com -- Tereos, a French company and one of the largest sugar manufacturers globally, anticipates a 9% decrease in the cultivation area for sugar beets in Europe for the upcoming season. The decline is a result of falling sugar prices within the European bloc.
David Souriau, Tereos’ commercial director, shared this projection during the S&P Global (NYSE:SPGI) sugar conference in Geneva. He described the decline as "major" for the sugar industry. Souriau also expressed his concern about the recent closure of mills in France, the Czech Republic, and Austria.
The mill closures could potentially cause a tightening in the market, which might allow sugar prices to recover. However, they could also result in price volatility, which poses a challenge for the industry to manage effectively.
Souriau stated that once a facility is closed, its capacity cannot be instantly restored. He emphasized that these events raise questions about the risk of price volatility, which he considers a crucial aspect of the market for the current year and the years ahead.
