British sugar beet producers will soon be able to lock in prices for two seasons ahead under a new futures index-linked contract aimed at increasing price certainty and managing market volatility.
The pilot scheme will allow growers to contract for a portion of the 2027/28 crop ahead of annual price negotiations, providing greater flexibility in how beets are sold and allowing companies to plan for margins further down the line.
The move was co-developed by NFU Sugar, British Sugar and agricultural produce specialist Czarnikow.
NFU Sugar Committee Chair Kit Papworth said the pilot would bring sugar beets on par with other key agricultural products.
“Farmers are used to being able to sell other products in advance, and this pilot will allow them to do the same with sugar beet,” he said.
He acknowledged that global sugar prices were now subdued, but warned that the market remained unpredictable.
“Currently, global prices are low, but the market is very volatile. This system allows producers to fix prices when market conditions become attractive.”
Current one-year index-linked contracts allow producers to price their beets against global markets, but to secure a price they must commit tonnage well in advance and pricing is limited to one season ahead.
The new futures index-linked option is designed to give producers visibility into futures market prices and the freedom to commit to beat pricing only if they choose.
There is no obligation to sell if the price is not attractive.
Dan Green, Director of Agriculture at British Sugar, said: “We are delighted to be launching this pilot contract option, which will give greater choice and flexibility to producers who wish to price some of their tonnage further down the road.”
Pricing will be linked to the global sugar futures market and the pound exchange rate, giving producers transparent visibility into futures values, similar to wheat and other traded crops.
Andrew Charlton, Head of Europe at Charnikov, said: “This continued innovation will give UK sugar beet growers more choice and improved future price prospects. We are delighted to be working with the NFU and British Sugar to expand our offer to farmers through the Cz app.”
Producers will be able to monitor futures prices via the Cz app from March 2, 2026, when the pilot officially begins.
The first tranche will allow up to 50,000 tonnes of beet drilled in spring 2027 to be sold at prices based on the October 2027 No. 11 sugar futures contract and the December 2027 dollar-pound exchange market.
Further tranches are expected to become available if uptake proves strong.
With input costs remaining high and global sugar markets prone to rapid volatility, the ability to push prices further forward could provide producers with new tools to manage risk ahead of the 2027 season.
