EU Quota Sugar Market Concentration – the Main Drivers of EU Sugar Market

H. ŘezbováM. MaitahO. I. Sergienko


No 4/2015, December
pp. 131-142

Řezbová, H. Maitah, M. and Sergienko, O. I. (2015) “EU Quota Sugar Market Concentration – the Main Drivers of EU Sugar Market”, AGRIS on-line Papers in Economics and Informatics, Vol. 7, No. 4, pp. 131 - 142, ISSN 1804-1930.

Abstract

The European sugar market is changing its character. During the last two decades its concentration changed and individual countries and companies have been preparing themselves for the end of sugar production quotas system. The level of competition within the EU sugar market is accelerating. Many companies already left the EU market or significantly reduced their production capacities. The main task of this material is to analyse the EU sugar market and especially sugar quotas character and to specify the current EU sugar production structures existing under the sugar quotas system. The paper is also identifying individual drivers/actors operating under the sugar quota system. The idea is to identify the level of EU sugar market concentration through the Herfindahl-Hirschman Index (HHI). The results coming from the analyses provides the overview of very specific character of the European sugar production quota system. However the market is operated by many companies and alliances, its production capacity are extremely concentrated. The majority of sugar plants are located in Germany, France, Poland and the majority of sugar quotas are controlled by companies headquartered in Germany, France, the Netherlands and the United Kingdom. In nowadays - the sugar quota system in the European Union is operated/controlled by only a few very powerful operators: Südzucker, Nordzucker, Tereos, ABF, Pfeifer & Langen, Royal Cosun and Cristal Union. This paper was supported by the Grant Agency at the Faculty of Economics and Management, Czech University of Life Sciences Prague: The selected aspects of economy sanctions and their impact on mutual trade between EU and Russia [nr. 20151031].

Keywords

Sugar production, sugar quota system, quota distribution, sugar market, EU market.

References

  1. CEFS, CEFS SUGAR STATISTICS 2014 [Online]. Available: http://www.comitesucre.org/site/statistics/ [Accessed 20 March 2015].
  2. DG Comp, London economics in association with global energy decisions: Structure and Performance of Six European Wholesale Electricity Markets in 2003, 2004 and 2005, presented to DG Comp 26th February 2007, p. 52 and p. 8, [Online] Available: http://ec.europa.eu/competition/sectors/energy/inquiry/electricity_final_part4.pdf [Accessed: 25 Aug 2014].
  3. Licht, F. O. International-sugar-and-sweetener-report, 2014. [Online]. Available: https://www.agranet.net/agra/international-sugar-and-sweetener-report/login/ [Accessed: 22 May 2015].
  4. European Commission, DG Agriculture and Rural Development. TENDER N° AGRI-2011-EVAL-03 , Study on price transmission in the sugar sector, Final report, October 2012.
  5. Chapter: 7.2. Effects of the reform on concentration and competition in the sugar sector. 118 s. [Online] Available: http://ec.europa.eu/agriculture/external-studies/2012/sugar-price-transmission/fulltext_en.pdf [Accessed: 2 July 2015].
  6. European Commission. Sugar and isoglucose balance sheets, 2014, Committee for the Common Organisation of Agricultural Markets. [Online] Available at: http://ec.europa.eu/agriculture/sugar/balance-sheets/balance-sheet_en.pdf. [Accessed: 27 May 2015].
  7. European Commission. EU Sugar Balance [Online] Available: http://ec.europa.eu/agriculture/sugar/balance-sheets/presentation_en.pdf. [Accessed: 5 May 2015].
  8. European Commission. Germany: The Bundeskartellamt imposes Fines on Sugar Manufacturers for Cartel Agreements [Online] Available: http://ec.europa.eu/competition/ecn/brief/02_2014/de_sugar.pdf. [Accessed 12 March 2015].
  9. European commission. Key commodities for ACP countries [Online] Available: http://ec.europa.eu/agriculture/developing-countries/commodities/index_en.htm. [Accessed 7 March 2015].
  10. Gohin, A., Bureau, J. C. Sugar market liberalization: Modelling the EU supply of “C” sugar. In Paper prepared for presentation at the XIth European association of agricultural economists conference Copenhagen, Denmark, August 24, 2005.
  11. Gotor, E. The reform of the EU sugar trade preferences toward developing countries in light of the economic partnership agreements, The Estey Centre for Law and Economics in International Trade, The Estey Centre Journal of International Law and Trade Policy. 2009, Vol. 10, No. 2, p.15–29. ISSN 1496-5208.
  12. Hirschman, A. O. The Paternity of an Index, The American Economic Review (American Economic Association), 1964, Vol. 54, No. 5, p. 761. ISSN 0002-8282.
  13. Chochola, J., Pulkrábek. Sugar Beet Research in the World, Listy cukrovarnické a řepařské, 2012, Vol. 128, No. 5-6, p.177–179, ISSN 1210-3306.
  14. Neundoerfer, M., European sugar policy. Unde venit - Quo vadit. 2011. Zuckerindustrie /Sugar Industry 136, (5), p. 317-324, ISSN: 0344-8657.
  15. Nolte, S., Grethe, H., Development of the EU and world sugar markets in 2011. Zuckerindustrie/Sugar Industry, 2012, Vol. 137, No. 1, p. 40-48. ISSN 0344-8657.
  16. Nolte, S., Grethe, H., EU and world sugar markets in 2010. Zuckerindustrie /Sugar Industry. 2011, Vol. 136, No. 2, p. 90-100. ISSN 0344-8657.
  17. Nolte, S., Buysse, J., Van der Straeten, B. , Claeys, D., Lauwers, L. Preferential sugar imports of the EU. International sugar journal, 2011, Vol. 113, No. 1346, p. 93-101. ISSN: 0020-8841.
  18. Nolte, S., Buysse, J., Van Huylenbroeck, G. Abolition of the EU sugar quotas - what's at stake? International sugar journal. 2014, Vol. 114, No. 1359, p. 146-150. ISSN 0020-8841.
  19. Machek, O., Špička, J. Measuring Performance Growth of Agricultural Sector: A Total Factor Productivity Approach. International Journal of Economics and Statistics. 2013, Vol. 1, No. 4, p. 200-208. ISSN 2309-0685.
  20. Severová, L., Bendl, S. Cartels and its behaviour on food markets. Agricultural Economics (Zemědělská ekonomika). 2013, Vol. 59, No. 2, p. 81-89. ISSN 0139-570X. DOI https://doi.org/10.17221/52/2012-AGRICECON.
  21. Smutka, L., Benešová, I., Pulkrábek, J. The World Trade of White Sugar, Listy cukrovarnické a řepařské, 2012, Vol. 128, No. 3, p. 86-89. ISSN 1210-3306.
  22. Smutka, L., Benešová, I., Pulkrábek, J. Analýza konkurenceschopnosti vzájemného obchodu se surovým a bílým cukrem mezi jednotlivými regiony světa (Analysis of competitiveness of mutual trade with raw and white sugar among particular world regions, in Czech). Listy cukrovarnické a řepařské. 2012, Vol. 128, No. 4, p. 141-145. ISSN 1210-3306.
  23. Smutka, L., Rumánková, L., Pulkrábek, J., Benešová, I. Main Determinants of Supply and Demand on World Sugar Market, Listy cukrovarnické a řepařské. 2013, Vol. 129, No. 4, p. 142-145. ISSN 1210-3306.
  24. Smutka, L., Rumánková, L., Pulkrábek, J., Benešová, I. The Relationship between Brazilian and World Sugar Markets. Listy cukrovarnické a řepařské, 2015, Vol. 131, No. 5-6, p. 194 -198. ISSN 1210-3306.
  25. Smrčka, L., Hoenig, V., Hromádko, J. Where is the Future of Sugar Industry in the Czech Republic, Listy cukrovarnické a řepařské, 2012, Vol. 128, No. 5-6, p. 193-198 ISSN 1210-3306.
  26. Strnadová, H., Actual progress and perspective of sugar-beet and sugar market, Listy cukrovarnické a řepařské 2009, Vol. 125, p. 334 -340. ISSN 1210-3306.
  27. Spettmann, T. European sugar in a competitive World. Zuckerindustrie / Sugar Industry, 2008, Vol. 133, No. 9, p. 589-595. ISSN 0344-8657.
  28. Špička, J., Janotová, B. Cost of sugar beet growing in the Czech Republic and international comparison, Listy cukrovarnické a řepařské, 2013, Vol. 129, No. 7-8, p. 210-214. ISSN 1210-3306.

Full paper

  Full paper (.pdf, 339.75 KB).