Sugar price drops

Press, 21 December 1981, Page 1

Sugar price drops

PA Auckland The retail price of I.skg pack of white sugar sold in the main centres, will drop 6c to $1.30, just below the level it was at the end of last year. The reduction follows up a drop of about 4 per cent in the price of sugar produced by the New Zealand Sugar Company, Ltd. The new price will apply to all deliveries that the company makes from today. The company’s managing director, Mr W. P. Ralph, said yesterday that in spite of the continuing increase in local costs, the world raw sugar market had weakened to such an extent that the reduction was now possible. New Zealand bought the bulk of its raw sugar under long-term contracts which were only partly affected by the world price movements, he said. The balance of new Zealand’s raw sugar requirements was purchased at world prices. The company was now in a position to take advantage of present market conditions.

The sugar price stabilisation agreement between the company and the Government was designed to protect the domestic price from the more extreme fluctuations in the price of raw sugar. Recent lower costs for raw sugar meant that the balance of the stabilisation account was now moving into credit, said Mr Ralph. Mr Ralph said that he did not expect prices would need to be reviewed again until well into next year. The managing director of Sport Drinks, Ltd, Mr C. L. Innes, said that his company would probably have a look at its over-all pricing structure.

However, he doubted that there would be any change in the price of soft drinks as a result of the sugar price reduction, because so many other costs had risen since soft drink prices were increased two or three months ago.

The sugar price cut might affect the total of any price increase for soft drinks next year, he said.