2017 was a year in which the initial yield’s predictions turned out to be significantly inaccurate.
Towards the end of 2016, the European Commission, in fact, had estimated that the total sugar stocks would have been below 1 million tonnes, the lowest level in the last 10 years.
But, what initially seemed to be a situation of supply shortage, turned out to be the exact opposite. Brussels, in actual fact, corrected what was previously stated during the first quarter of 2017, declaring that the market was substantially under control and without any shortages. As a result, the stocks at the end of the campaign well exceeded 2 million tonnes, bringing the market price below the $350/ton threshold.
In light of this, and with the starting date of the quota-free production approaching, during 2017 prices began a rapid decline. This was also influenced by the drastic drop on the international markets, causing the market price to be incapable to cover the production and refining costs. Furthermore, sugar consumption in Europe decreased by almost four percent due to anti-sugar policies promoted by central governments.