NFU Sugar and British Sugar reach agreement on 2027/28 sugar beet contract

Negotiations had been unable to reach a conclusion through the usual framework since the beginning of August, leaving growers waiting for clarity over prices and contract terms. The eventual settlement offers several pricing options, allowing farmers to choose how they allocate their beet tonnage according to their appetite for risk and exposure to the market.

However, although the outcome has been described as better than expected, some growers remain concerned about whether the terms provide sufficient confidence to continue growing sugar beet in the face of rising production costs and increasingly unpredictable weather.

What does the new sugar beet contract offer?

The agreement gives growers three contract options for the 2027/28 season:

• Fixed-price contract: A one-year contract paying £28.50 per tonne for up to 50% of a grower's contracted tonnage.
• Market-linked bonus contract: A one-year contract with a guaranteed base price of £25.50/t, available for up to 100% of contracted tonnage, with an additional bonus linked to sugar prices.
• Index-linked contract: Available for up to 50% of contracted tonnage, with its value linked to the No. 11 raw sugar futures contract and the relevant sterling-dollar exchange rate. The contract is calibrated to begin at £25.50/t.

Under the market-linked bonus option, growers will receive 25% of the value achieved above a trigger point when British Sugar's average ex-works white sugar selling price exceeds €560/t. Farmers can also split their contracted tonnage between any of the three options, giving them greater flexibility over how they balance guaranteed returns against the potential benefits of stronger market prices.

The agreement includes additional provisions designed to support growers. These include yield protection, with a £0.90/t reduction on the fixed and market-linked bonus contract prices, transport allowances covering up to 60 miles for all factories and up to 75 miles for growers supplying Cantley. An interest-free cash advance option, late delivery allowance and complimentary frost insurance are also included.

Growers welcome the outcome but question long-term confidence

For some growers, the agreed terms represent a more positive outcome than had been feared during the negotiations. However, the wider challenges facing sugar beet production continue to raise questions about its place in his farming business.

Rising costs of production, prolonged dry spells during the summer and increasingly wet conditions during lifting are all affecting the crop's appeal. These pressures make it more difficult for growers to assess potential returns and decide how much of their land to commit to sugar beet.

This highlights the importance of timely contract announcements and greater certainty for growers who must make cropping decisions well ahead of harvest. With input costs, weather patterns and market prices all influencing profitability, farmers need to understand the likely returns from sugar beet when comparing it with alternative cropping options.

Making informed cropping decisions

The agreement marks an important step towards resolving uncertainty for sugar beet growers, but the wider questions around profitability and long-term viability remain.

For arable businesses, decisions about cropping increasingly require a careful assessment of input costs, market opportunities, weather risks and the security offered by different contracts. The ability to compare guaranteed prices with market-linked returns may help growers tailor their approach, but the value of those options will ultimately depend on individual farm circumstances.

As growers consider their plans for 2027/28 and beyond, access to reliable market information, technical advice and opportunities to share experiences with other farmers will remain important.

CropTec brings together the arable industry to explore the challenges and opportunities shaping farm businesses. From crop choice and input efficiency to market trends, technology and profitability, the show provides a platform for growers to access knowledge and ideas that can support more informed decisions for the seasons ahead.

CropTec 2027 takes place alongside LAMMA at the NEC Birmingham on 20–21 January 2027.

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