2021/22 contracts - a reminder of your rights and obligations

Sugar beet harvester at work

Given the very poor yields we are seeing this campaign, NFU Sugar has received a number of enquiries from growers asking about their contracts for 2021/22. We hope growers will find the following information helpful. NB, the options each grower has is clearly dependent on the contract(s) you hold.

Please note that the information below is not in relation to performance rules. Performance rules for the 2020 crop remain as described in the IPA (available to view on the NFU Sugar website). As is always the case, British Sugar retains the right to enact the provisions of performance rules at the point of contracting.

Any tonnage on a 2020-2022 three year deal:

These are legally binding contracts signed last year covering the 2020, 2021 and 2022 crops. British Sugar therefore has the legal right to enforce these contracts. If you are in difficulty we urge you to speak to your British Sugar contract manager. Historically British Sugar has not sought financial compensation for under-delivery of tonnage (given that it is a variable crop without any means for a grower to buy-in beet to make up a shortfall, as they could with wheat), but British Sugar retains the right to seek compensation for any shortfall in delivered tonnage under the contract.

Any tonnage on a 2020-2022 three year deal held by a Newark grower contracted at 50 miles or above:

This is the one exception to the above situation. We have agreed with British Sugar as part of the 2021 contract agreement that all growers at 50 miles or above from Newark would have the option to exit multi-year contracts without penalty.

Any tonnage contracted from 2021 (on either the 2021 one-year or three-year contracts):

If you have tonnage available for recontracting in 2021/22, it is your decision whether to offer that tonnage or not. If you have not yet contracted, it remains your choice whether to contract some or all of that tonnage with British Sugar, although please note that since the contracting deadline has passed, British Sugar is not obliged to accept your offer to grow at this point. If you have already submitted a contract offer to commence in 2021/22, you have the right to withdraw that offer by sending written notice to British Sugar within 15 days of receipt of your notice of acceptance. If you do not send written notice of withdrawal within 15 days of the date of receipt of your notice of acceptance, then the contract is binding and you are obliged to grow the tonnage set out in your offer to grow. Please note we are anticipating. British Sugar will issue notices of acceptance in the week commencing 9 November 2020.

Growers with a combination of tonnage already contracted from 2020 and newly contracted in 2021:

Your rights and obligations with regards to each of these contracts are in line with the categories above. For example, if your tonnage is split between a 2020 three year contract and 2021 one year contract, you retain the right to withdraw your offer only for the part of your tonnage being contracted from 2021.

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