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Sugar beets to be reduced |
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Wednesday, 16 April 2008 |
Surplus inventories and booming alternate crop prices have combined to drastically reduce sugar beet production in southern Alberta this year.
By Ric Swihart
ALTA Newspaper Group, LP
Andrew Llewelyn-Jones, agricultural superintendent for Rogers Sugar, said Monday between 19,000 and 20,000 acres of beets will be planted. The contracting process is not finished.
Last year, growers grew about 34,000 acres of beets, and the company indicated in winter it could cut production to as much as 25,000 acres.
Llewelyn-Jones said record sugar production in 2006 and 2007 left the company with surplus sugar stocks, and reducing beet production this year would help it reduce inventory. Such a large inventory is not good for the company or growers, he said.
Those same conditions resulted in a one-year production contract between Alberta Sugar Beet Growers Marketing Board directors and the company. Normally, a three-year contract is negotiated.
Bruce Webster of Taber, general manager of the marketing board, said the new one-year contract provided a small increase in the sugar price for growers.
When the company announced its need for reduced acreage this year, the board implemented its leave of production clause, said Webster.
"Fifty-five per cent of beet growers will grow beets this year and 45 per cent are hoping to make more money doing something else," he said.
He said the prolonged talks actually forced the 2007 production contracted acreage lower than anticipated because more growers decided on alternative production rather than waiting longer for the new sugar beet contract to be signed. An earlier sugar beet contract likely would have put beet production at about 25,000 acres this year, he said.
"The talks went on a month longer than expected," said Webster. "Cereal prices continued to increase and more growers decided not to grow beets this year. This was a good opportunity for growers to play the market a bit. But we will be back to normal for 2009."
Normal will also reflect the increasing cost of production of those alternate crops and Rogers' increasing processing costs, said Llewelyn-Jones. "We will need a new contract that is a win-win for both (company and growers)."
Flexible Solutions is renovating an old potato processing plant to begin making aspartic acid with sugar beet juice - the standard is made with petroleum products - and there is a strong confidence in this new domestic market for sugar, said Webster.
Llewelyn-Jones said Rogers has heard the company may require 3,000 to 5,000 tonnes of sugar equivalent thin juice, made early in the process that ends in granulated sugar production, when the 2008 processing campaign begins in the fall. That would be juice from 25,000 to 30,000 tonnes of sugar beets. Last year, growers produced 853,669 tonnes of beets.
Thick juice, a product that can be made into granulated sugar or stored for later processing, had been an important product for export to the United States. But with larger sugar crops in the U.S. the last couple of years, no thick juice was sold there.
"Thick juice is not a factor in our marketing plans," said Llewelyn-Jones. |
