The CEO of Suedzucker, Europe’s largest sugar factory, said on Thursday May 16th that trading conditions due to low sugar prices are expected to remain challenging in the first half of fiscal year 2019/20, but he said improvement could come from October.

Suedzucker is struggling with a fall in world sugar prices, which, under the pressure of a strong global excess, stopped at the lowest level in 10 years in 2018.

On Thursday, May 16, the company confirmed a drop in the group’s operating profit in 2018/2019 as of the end of February from 445 million euros the previous year to the current 27 million euros.

CEO Wolfgang Heer said on Thursday May 16 that the group did not see a significant positive momentum for sugar prices, despite forecasts by leading FO Licht analysts about a balanced global sugar market in 2018/19 and a slight deficit next year.

“Despite this, in the middle of the fiscal year, we expect a higher, but still unsatisfactory price for sugar,” Wolfgang Heer predicted.

According to him, due to reduced exports and reduced sugar inventories in the European Union, the company expects profit growth from October.

At the beginning of the year, the German sugar giant, due to the collapse in sugar prices, announced the closure of its sugar factories in Poland, France and Germany and the phasing out of production capacities of approximately 700 thousand tons.

The sugar giant predicts its operating profit in the marketing year 2019/2020 at a level of 0 to 100 million euros and a loss for the sugar sector in the range of 200 to 300 million euros.

In Germany, more than 56,000 farmers grow sugar beets on an area of ​​459.4 thousand hectares. The average sown area is 38 ha. The yield of sugar beet root crops in the country is 500-600 c / ha.