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Cautious Approach Needed Before Any Decision on EU Out-of-Quota Sugar Exports Is Taken
Date:1/27/2010

SAO PAULO, Jan. 27 /PRNewswire/ -- Following the announcement by the European Commission to propose additional out-of-quota sugar exports for an amount of 500,000 tonnes, the Brazilian Sugarcane Industry Association (UNICA) reiterates its call on the Commission for a cautious approach, taking into consideration all interests at stake and potential dramatic consequences.

According to UNICA, the European Commission is sending wrong signals to EU farmers, who are being incentivised to more sowings ahead of the next campaign, although current higher sugar prices on the global market are merely conjectural. "This short-sighted policy is potentially damaging for the EU sugar market as EU farmers will be left with additional surpluses to be exported; this when global prices return below the EU price," warned Marcos Jank, President and CEO.

While it acknowledges the exceptional character of the circumstances leading to the Commission's announcement, UNICA calls on the European Commission to strictly limit the additional out-of-quota sugar exports to the 2009/2010 marketing year and to explicitly rule out any precedent the decision would set for the following marketing years. Finally, UNICA reiterates its call for engaging the parties to the EC-Export subsidies on the sugar WTO panel, Australia, Brazil and Thailand. "We understand that the conformity of the Commission's decision with its international obligations is open to interpretation. The draft Regulation should therefore be submitted to the WTO for a conformity assessment prior to its adoption," concluded Marcos Jank.

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SOURCE The Brazilian Sugarcane Industry Association (UNICA)
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