All growers on the 2019/20 one year contract will receive a 2.6p/t market bonus, following publication of the average EU+UK white sugar price for September 2020.
This is the first time the market bonus mechanism, introduced in the 2017 beet contract, will have been paid out, albeit at a very modest level. Nonetheless, it amounts to c.£73k across the grower base
How much will I get?
The table below shows some illustrative figures at various tonnages. You will receive confirmation from British Sugar of the exact figure you will be paid based on the exact tonnage you delivered against the contract.
|Tonnes delivered on 2019/20 1 year contract||Total market bonus to be paid|
When will I be paid?
You can expect payment to be made by British Sugar in December. If you hold a beet contract for 2020, and are due a payment in early December, payment will be made at the same time as an existing payment run. If you currently hold a debt on your account that is due to be offset against beet income (such as payment for seed), the bonus will firstly be offset against this debt. Otherwise, you will receive this as a standalone payment in early December.
As the bonus is linked to the EU price, what is going to happen in January 2021?
NFU Sugar agreed in 2019 a new mechanism for the market bonus calculation to apply once the UK no longer feeds values into the EU average reported price. The UK is currently still doing so, with the price published for the EU+UK, but we anticipate that the price quoted from January 2021 onwards will not include the UK.
The new mechanism will apply from the point at which the EU price no longer includes the UK within the average. An independent auditor will be employed to compare the difference in British Sugar’s average price from the EU average price each month with the differential in the two prices between 2017 and 2019, to establish any change in value in the UK market relative to the EU market post-Brexit. The market bonus will be paid on this re-adjusted level.
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