Beet sugar

Press, Volume CXIV, Issue 33454, 8 February 1974, Page 8

Beet sugar

The proposal that part of New Zealand’s sugar requirements be produced from sugar beet in Mid-Canterbury is beginning to look more attractive than it did 18 months ago when a deputation of farmers approached the Government. The London price for raw sugar then was about £67 a ton and some developing countries which depend on the crop for most of their foreign exchange — not least of them. New Zealand’s neighbour Fiji — were having trouble finding markets. Since then world agreements on sugar have collapsed; demand has increased much faster than was expected: the price of raw sugar in London reached £l9O a ton last month: and demand is expected to increase even faster in the next few years. The present shortage of sugar from the Chelsea refinery in Auckland, caused by labour problems and a high summer demand, indicates that there is little surplus production capacity in New Zealand. There appears to be little doubt among farmers in the area and their advisers from Lincoln College that sugar beet can be grown, or that it would be an economic way of using cropping land. But someone else, probablv the Government, would have to meet the cost of setting up a beet milling plant — perhaps 85 million. The proposal at present is to grow no more than would meet the South Island's demand; the North Island would continue to use cane sugar and Fiji's market here would be reduced by only a small amount. The new sugar industry in Papua New Guinea — a country which desperately needs foreign exchange and which has been promised help from New Zealand — would probably be kept out of the New Zealand market. As the price of many imports to New Zealand increases rapidly this country needs to conserve its foreign exchange while ensuring that it is producing the most valuable exports possible. This raises much wider issues than the enthusiasm of some Canterbury farmers for what looks like a profitable new crop. Many imponderables are involved in the equation of whether New Zealand would do better to grow some of its own sugar or use the land for more export crops. Government assistance in the form of cheap finance for a South Island sugar mill would be not unreasonable; heavy protection in the form of import licensing and duties would be contrary to the Government’s professions of concern for under-developed countries.