Farmers in southern Alberta, home to Canada’s main sugar beet growing and refining industry, welcome booming world sugar prices because it could mean greater profits for processor Lantic Sugar and higher returns for growers.
Andy Koster of Picture Butte, Alta., owner of Koster’s Bakery, who recently bought 7,000 pounds of granular sugar to brace for expected higher retail prices, said the sugar price is increasing for the right reason. Southern Alberta’s sugar beet growers could directly benefit from the rising prices.
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Alberta Sugar Beet Growers Marketing Board directors and Lantic Sugar signed a three-year master agreement before the 2009 crop was planted. It includes a clause that could trigger a premium sugar beet price for growers depending on world prices and sales.
Rob Boras of Picture Butte, board president, said it is too early to say how much benefit southern Alberta beet growers will receive because all the sugar from the weather-ravaged 2009 crop has yet to go to market. Because of the uncertainty, Boras can’t specify final payments per tonne, but said growers need some indication when they begin talking operating money and loans with bankers.
Andrew Llewelyn-Jones of Taber, agricultural superintendent for Lantic, said the new three-year contract signed with the marketing board will produce better returns for growers.
Growers harvested about 35 percent of the 2009 crop in excellent condition. Then Oct. 4, the weather turned nasty, leaving about 6,500 acres in the fields.
Some Montreal bakers indicate a tripling of the sugar prices and a hike in bakery goods prices last year will likely be followed by a 20 percent hike this year.
Edward Makin of Lantic urges calm, claiming most customers will avoid raising prices unless sugar prices remain in the range of 28 cents a pound US for months to come. A year ago, the wholesale price was about 11 cents per lb.
