How will the UK's upcoming trade deals affect British sugar growers?

Published 17 August 2021

NFU Sugar International trade
Sugar beet - Michael Sly

As the UK takes advantage of its newly independent trade policy to seek trade deals with countries around the world, NFU Sugar is representing UK beet growers’ interests and ensuring the voice of the homegrown beet industry is heard.

We want trade outcomes that support UK beet growers to grow their businesses and to provide food for Britain and beyond.

Sugar beet - Michael Sly

Michael Sly, NFU Sugar board chair, pictured above, said:

“The UK homegrown sugar industry is a true British success story and is one of the most efficient sugar producers in the world. But British growers cannot compete against growers who follow a different rulebook.
“The British industry should also be given the opportunity to export to those markets where a premium can be achieved and where barriers currently exist to access.”

Below you can read the NFU Sugar position on the trade deals currently being negotiated or in the process of ratification. In each case, we outline what NFU Sugar is calling for and the opportunities for UK growers.

Click on the links below to jump straight to the relevant section.

Australia

NFU Sugar position: We are incredibly concerned by the potential introduction of tariff-free, quota-free access to the UK market for Australian sugar. The UK is one of the most efficient sugar producers in the world, so by all accounts should be well placed to compete with growers anywhere if we had access to the same tools and technologies. But British growers cannot compete against growers who follow a different rulebook.

For example, Australian sugar cane growers have access to an armoury of plant protection products containing over 30 active ingredients which are illegal for any outdoor use in the UK.

What we are calling for: If there is to be a duty-free quota introduced, access to this quota should be on the basis of demonstrating the cane has been produced in ways that align with UK regulations. For example, it should be certified to show that none of the 13 pesticides approved for Australian sugar cane, and which have been actively banned in the UK, have been used on that crop (including Paraquat and Atrazine for example). Access should be via monthly or quarterly import licences rather than first-come, first-served, which increases transparency and reduces market disruption.

Opportunities for the UK: The opportunity here is to establish a principle that duty free access must come alongside a genuine and enforceable commitment to upholding consistent rules and regulations on imported products in line with those UK growers follow.

Read more from NFUonline: UK-Australia trade deal: The view from NFU Sugar board chair Michael Sly


Canada

NFU Sugar position: Canada provides opportunities for the British sugar sector with potential to access the Canadian market premium. While in theory Canada has liberalised access for sugar into its market, significant anti-dumping and countervailing measures in practice make access prohibitive and maintain a premium in the Canadian market. Canada applies both anti-dumping and countervailing duties to white sugar imports from the UK which prevent any significant quantities of refined white sugar imports from the UK. These policies were introduced in 1995 in relation to subsidies which no longer exist, and it must be noted there are likely to be further drops in agricultural support for British sugar growers with the phasing out of BPS.

What we are calling for: A priority must be removing these anti-dumping and countervailing measures to secure greater access to the premium Canadian market for UK sugar producers.

Opportunities for the UK: This would offer an opportunity for the UK sector to access a premium market which is currently protected by anti-dumping measures with questionable justification. This approach would allow the UK government to show that it is serious about tackling unjustified barriers other countries place on UK exports.

Read more from NFUonline: Government launches call for input ahead of negotiations with Canada and Mexico


Mexico

NFU Sugar position: Mexico is a major sugar cane producer and exporter. Mexican growers have far greater access to plant protection products such as Paraquat, which is not authorised for use in the UK. Coupled with the extensive access already afforded to the UK’s domestic sugar sector under other agreements, we have serious concerns about the impact on the domestic sector should Mexico be given further access to the UK sugar market. The EU-Mexico Modernised Agreement contains a quota of 30,000t with a tariff of €49/t, phased in over three years.

What we are calling for: The NFU would support an approach consistent with the EU-Mexico Agreement in a new UK-Mexico FTA. We are clear that the UK should uphold consistent environmental production standards for agri-food goods in its trade agreements, both in terms of domestic production and for the products which we import.

Opportunities for the UK: Maintaining a level of consistency with EU agreements avoids further introduction of tariff-free access for sugar produced in ways that would be illegal in the UK. There is also an opportunity to establish a principle that concessions must come alongside a genuine and enforceable commitment to upholding consistent rules and regulations on imported products in line with those UK growers follow.

Read more from NFUonline: Government launches call for input ahead of negotiations with Canada and Mexico


India

NFU Sugar position: As many other globally trading nations have done, the UK government must recognise the substantial and potentially non-WTO compliant subsidies offered to the Indian sugar sector. India is currently the second largest sugar exporter in the world but has been providing its industry with a very high direct export subsidy to support the domestic sector and maintain high internal prices. Brazil, Australia and Guatemala took India to the WTO in 2019 to challenge this programme, and a conclusion is expected soon.

What we are calling for: The UK government must not consider any sugar tariff concessions for India while the WTO challenge is ongoing and until the necessary action to resolve the findings is taken.

Opportunities for the UK: If the UK government aspires to be a responsible free trading nation in the mould of Australia, this course of action presents an opportunity to show support for the case made by Australia, Brazil and Guatemala. It also allows the UK government to demonstrate it recognises the responsibilities we would expect our trading partners to meet in order to benefit from a free trade deal with the UK.

Read more from NFUonline: Government opens consultation on UK trade deal with India


Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP)

The UK government has also started its bid to join the CPTPP, a partnership that includes three of the countries in the list above.

Read more from NFUonline: Government starts bid to join the CPTPP

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