Fierce Competition Prevails on World Sugar Market

CANBERRA - Mar 6/02 - STAT -- Sugar producers who need to find export markets for their production will continue to face a tough trading environment on account of high trade protection and domestic support in most major consuming and producing countries.

This has left markets vulnerable to low cost Brazilian exports ABARE principal research officer, Rohan Nelson, told the Outlook 2002 conference here. "currently, world sugar prices are under severe pressure, with high world sugar stocks and a record Brazilian harvest expected.

"Despite favorable seasonal conditions and a forecast 15% increase in Australian sugar production in 2002-03, grower incomes and average returns per hectare planted are expected to fall as a result of lower returns in key export markets," Dr Nelson said.

Speakers at the conference predicted world sugar markets are only likely to rise eight cents US per pound by 2006, while producers in countries such as Australia see their production expenses rise, squeezing long term income prospects.

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