Suedzucker, the largest sugar producer in Europe, confirmed that its quarterly profit jumped 90% during the third quarter, supported by the recovery of sugar markets, as operating profit rose during the three months to November 30 to 127 million euros ($145.30 million), while sales jumped 17.4 percent to 2.04 billion euros.
The company reiterated its full-year forecast, published in December, that operating profit will range between 320-380 million euros, up from 236 million euros last year.
Suedzucker, whose businesses range from pizza and processed foods to batch food and bioethanol, says its sugar business has started to generate operating profit of €10 million after losing €28 million during the same period last year.
Sugar futures recorded their highest levels in 4 and a half years in October, as rising energy prices led to more demand for sugar-based ethanol fuel amid weak global sugar supplies, but prices have retreated from their peak during January.
It is worth noting that cotton prices also reached record levels last October. Read more [Cotton Prices Are At Their Highest Level In 10 Years].
The company expects to produce 4.2 million tons of sugar this season, compared to 3.5 million tons last year. Since October 2021, Suedzucker’s sugar business has benefited from higher sales revenue and cost savings from the company’s recent restructuring program, which included the closure of several plants, but this will be offset by increased energy prices and material mobilization costs, and the fourth wave of corona may lead to additional expenses.