Blog

6 November 2018

A year in review – how sugar fared in 2018

A blog from Dr Mark Carr, CEO of AB Sugar

This year, the European sugar industry has continued its transition from a regulated to an unregulated environment, resulting in significant changes in the way industry players operate. As expected, this has had an impact on the profitability of many leading sugar businesses, including ourselves, as publicised in today’s Associated British Foods plc (ABF) annual results.

However, through this turbulent transition we continue to focus on the long-term position of AB Sugar and believe it is important to recognise the many achievements during the past 12 months, some of which are included in ABF’s 2018 Annual Report. From AB Sugar China’s focus on transforming the sustainability of the northern beet sugar sector by strengthening grower relationships through to further developments in our route to market and consumer brand positioning across Africa through our Illovo businesses. Additionally, the operational improvements throughout the Azucarera and British Sugar supply chains continue to boost competitiveness, flexibility and quality of service in the face of very low EU prices. These steps will continue to underpin our resilience across the world.

Driving performance is more than just financial and operational results and extends into many other areas, not least, employee health and safety. We are working hard to achieve our ambition of aiming for zero incidents and I have been particularly disappointed that this year we have not achieved our target. It is simply unacceptable that anyone involved in our business is harmed whilst undertaking their duties and we know we must work harder to ensure we deliver our ambition.

Creating a positive impact on those around us

In building upon our work so far, our industry-leading commitments for 2030 launched earlier this year, align to the UN’s Sustainable Development Goals (SDGs), and the three pillars of our ‘Global Mind, Local Champions’ framework. These commitments frame our sustainability work for the next decade and will involve work across the entire value chain to improve both our direct and indirect impact.

This year, it is rewarding for our teams to have been recognised more for our accomplishments, in particular our circular economy approach which won the ‘Reduce, Reuse, Recycle’ category at the Global Good Awards for the extensive work undertaken particularly by Azucarera and British Sugar. The results from a multi-stakeholder project to support growers surrounding Illovo Sugar Africa’s Maragra plantation in Mozambique to secure their land rights, have demonstrated a viable and practical solution through the use of technology to help farmers formalise their land tenure and better understand their rights. More information on our recent successes can be found in ABF’s 2018 CR Update.

An eye on the future

Throughout this current period of transition and in the years to come we will remain resilient. Our focus is clear and we believe that as one of the world’s largest and most efficient sugar businesses[1], we will continue to succeed in this new era for sugar.

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[1] LMC 2018 Report: Sugar & HFS Production Costs Global Benchmarking