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COM (84) 238 
 
 
 
Vol. 1984/0 115 
  
 
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concernant l'ouverture au public des archives historiques de la Communauté économique 
européenne et de la Communauté européenne de l'énergie atomique (JO L 43 du 15.2.1983, 
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In accordance with Council Regulation (EEC, Euratom) No 354/83 of 1 February 1983 
concerning the opening to the public of the historical archives of the European Econom ic 
Communit y and the European Atom ic Energy Communit y (OJ L 43, 15.2.1983, p. 1), as 
amended by Regulation (EC, Euratom) No 1700/2003 of 22 September 2003 (OJ L 243, 
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file have been declassified in conformity with Article 5 of the aforementioned regulation.  
In Übereinstimmung mit der Verordnung (EWG, Euratom) Nr. 354/83 des Rates vom  1. 
Februa r 1983 über die Freigabe der historischen Archive der Europäischen  
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COMMISSION OF THE EUROPEAN COMMUNITIES
COM(84) 238 final
Brussels, 25 April 1984
REPORT FROM THE COMMISSION TO THE COUNCIL
pursuant to Article 24(7) of Regulation (EEC) N° 1785/81 
on the common organization of the markets in the sugar sector
COM(84) 238 final

Report from the Commission to the Council 
pursuant to Article 24(7) of Regulation (EEC) No 1785/81 
on the common organisation of the markets In the sugar sector
Regulation (EEC) No 1785/81, the basic Regulation on sugar, provides for the 
production quota system to be maintained from 1981/82 to 1985/86 and lays down 
that the Council shall examine, on the basis of a Commission report on the 
world supply situation, whether a revision of the production quotas for 
1984/85 and 1985/86 is necessary.
I. Trend of the world sugar market (1)
Sudden_increase inworld sugar production in_1981/82_
1. In 1981/82 - the first year in which the new basic Regulation was
applicable - world production of sugar showed a steep year-on increase 
of 12,5 million tonnes (+ 14%) to reach 100,6 million tonnes. The 
contribution of cane sugar to this increase was easily as large as that 
of beet sugar. The main causes were the very good weather enjoyed by 
most of the major sugar-producing areas, which led to high yields, and 
the expansion of beet and cane-growing acreages. The latter factor 
must be interpreted as a reaction to the prices on the world market in 
the previous two years, 1979/80 and 1980/81, when the world production 
had lagged behind the world demand.
(1) All quantities are expressed as raw sugar.

-  2 -
Unwarranted fears of a shortage had, within the space of a year, led to 
a 350% increase in prices on the free world sugar market, hence the 
increase in acreages in 1981/82.
2. The record production figure in 1981/82 rapidly led to a sharp drop in 
prices, which had a dampening effect - especially in Western Europe - 
on beet growing. For 1982/83 it was assumed initially that production 
would drop more sharply, but this did not happen. It will not be 
until 1983/84 that a drop in production - by about 5% - can be 
anticipated, partly as a result of a further contraction in beet 
acreages and partly owing to drought damage and bad weather in the 
southern hemisphere.
Substantial increase_in world sugar consumption after several years, of
stability_
3. In the fifties and sixties the average increase in world sugar 
consumption was between 3% and 3,5% a year. In the early seventies 
the annual growth rate dropped to about 2,5% and was almost zero by the 
end of the decade. It is only since 1981/82 that consumtion has 
revived. It is evaluated at 95,6 million tonnes for 1983/84. An 
increase of between 1,5% and 2% per year 1 b expected for the near 
future.
4.  The trend of consumption is uneven. It is determined initially by 
population growth, of which only a minimal proportion is accounted for 
by the western industrialized countries and an increasing proportion by 
the developing countries. Another obviously important factor is the 
level of consumption in absolute terms.

- 3 -
Whereas average annual consumption per head of population in all 
countries is currently around 20 kg, in the industrial countries it is 
35-50 kg which must be close to saturation. In per capita terms, 
significant consumption potential is offered by the developing 
countries, with their average figure of 13 kg, and in particular Asia 
and Africa. In the short time span between 1974 to 1982, sugar 
consumption in the developing countries rose from 30,1 million tonnes 
to 45,3 million tonnes, i.e. by 50%; during the same time span it 
hardly changed in the developed countries. The share of the developed 
countries in world consumption fell from 60% to 50% within the space of 
only eight years.
5. However, the trend of sugar consumption in the developed countries
would have been more favourable if it had not been for the fact that in 
the western industrialized countries increasing use was made of other 
sweeteners, mainly isoglucose, as substitutes for sugar.
Production and consumption of isoglucose rose from marginal values in 
the first half of the seventies to more than 4 million tonnes (dry 
matter) in 1983. This trend was triggered by the extremely high 
prices on the world sugar market during the period of shortage in 
1973-75. The trend is particularly marked in the United States, Japan 
and Canada, traditionally the main importing countries; in the 
Community the trend was limited by the fact that isoglucose is included 
in the sugar sector production quota system. In the coming years, 
this trend will probably continue especially in the countries 
mentioned. The level and trend of sugar consumption in the other 
countries, particularly the developing countries should not be 
decisively affected by the development of isoglucose production; the 
same goes for low-calorie sweeteners substitutes for sugar, viz. 
saccharin and aspartame.

- 4 -
Sugar 8tock8_at. maximum level on 1 September 1983
6. Since production in the last two marketing years has far exceeded 
consumption, stocks at 1 September 1983 had increased to 38,0 million 
tonnes, equivalent to 40,4% of annual consumption. Working on the 
principle that at 1 September the "normal stock level" may be regarded 
as 25% of consumption, the effective total stocks represented a surplus 
of 14,1 million tonnes; this corresponds to the increase in stocks 
between 1 September 1981 and 1 September 1983.
7. Only about one quarter of thiB increase in stockB was accounted for by 
the importing countries, among which China and the East European 
COMECON increased their stocks significantly, whereas sugar stocks in 
North America remained stable.
Among the exporting countries, India and the Community showed by far 
the highest increases in stocks, the Community accounting for 
6,1 million tonnes. Whereas India refrained from using up its ISA 
export quotas because of the low world market prices, the Community, on 
realizing that production was exceptionally above average, embarked on 
an active storage policy at the beginning of 1981/82 and 1982/83.
This decision increased its stocks by more than 2 million tonnes.
8. According to present estimates of world production and consumption, it 
is not expected that stocks will diminish significantly in 1983/84.
It is only if world production in 1984/85 is planned so as to take 
account of this fact that any stabilization in the supply situation and 
lasting improvement in world market prices can be counted on in the 
medium term.

- 5
Persistence of_low_pric.es. 2.n_the_free world market_
S. The sugar prices on the international exchanges (Kew York, London,
Parir) have shown spectacular fluctuations. In Movember 1981, the 
New York spot price for raw sugar was at its highest level since 1974 
(A 3 , 1 3 cts/lb),  from which it than entered an almost unwavering 
downward slide to an all-time low of S ,37 cts/lb in October 1 ,932.
These exceptional price fluctuations can b© mainly explainad by the 
following factors:
- producers are unable to adjust c ■>>,' .  t of a .  ls»d-dsper;danv -md 
weather-depend«n; crop to short-terr.-. -.r.rket trend*,
- producers' incomes depend not only tut prices on the free world 
mai'toc but abo’  e all on the almost universally controlled i:;tsmal 
market prices and admission to markets where preferences are applied
- low world market prices are reflected o n internal markets only In 
respect of about 20% of world consumption•
- r.et imports demand correspond to only one-fifth of world 
consumption, and all fluctuations In production and consumption have 
an impact only on the free market.
10. These factors clearly show that world sugar prices are constantly 
subject to cyclical fluctuations. During the period in which 
production lags behind consumption and stocks are regarded as 
inadequate, the desaand, very.little influenced by high prices, favours
never the lesu a sharp c>r.i c*r 4  ncres.se as ir. 1973-75 and in the second
/ e
half of 1979 and I9rt,  followed by several years of extremely low
pri co*-

-  6 -
The main reasons why prices fall are that producere over-react In 
thelr expansion of output and that stocks on hand tend to be run down 
in response to falling prices.
11. The current world market prices, representatlve of a low-price phase 
(6—10 cts/lb),  are eguivalent to less than half of a price at thè 
mid-point of thè price range (13 and 23 cts/lb) agreed under thè 
International Sugar Agreement. The same applies in thè case of thè 
Community price, whìch is only slightly above mid-point of thè ISA 
price range.
Raw-suxar prices
ECU/100 ka in X US cts/lb
1. ESC intervention
price for raw sugar  
1983/84, including  
thè Storage levy 48,25 100 18,46
2. Mid-point of thè 
price range agreed 
under thè ISA 47,05 98 18,00
3. ISA daily price 
0 Nov. 1983 21,74 45 8,39
4. Target market price 
USA 1983/84 55,33 115 21,17
USD 1 = 1,18562 ECU

- 7 -
Apart from this, thè production costa publìcly known on thè main sugar 
exporting countrìes Ile in thè ragion of 13-17 cts/lb. For thè 
markets of th© two main importlng countries - USSR and USA - there are 
special condìtions involving prices which are significantly or even 
vory Bignificantly above thè mid-point of thè ISA price range.
Diminis.hi.ng. ìmpprt_requirements o f _industrialized countri.es. and increasing
.imports. by developing countri^a^
12. Grosa importa of sugar showed a temporary increase in recent yeacs, 
rising from 28 to 31,9 mìllion tonnes in 1981/82, but now seem to be 
reverting to theìr earlier level. Net importa from thè free world 
market followed a aimllar pattern, rising initially from 17,7 mlllion 
tonnes in 1979 to 20,8 million tonnes in 1982 and now reverting to 
18,3 million tonnes.
13. What is more important than this overall movement of thè volume of 
world trade is thè fact that net imports from thè free world market by 
thè developed countries dropped between 1976 and 1982 from 9,3 to
9,1 million tonnes, while net imports by thè developing countries in 
thè same period climbed from 5 to almost 12 million tonnes. Thus,  
thè shift of emphasis towards thè developing countries is even 
becoming greater in thè case of trade than in thè case of consumption.
1A .  Closely related to this is thè fact that thè markets for raw sugar and 
white sugar follow different trends.  Whereas thè decline in thè 
import requ1rememnts of thè United States, Japan and Canada, on 
account of sugar replacement by isoglucose, concerned only raw sugar, 
most of thè increase in thè demand from thè developing countries 
concerned white sugar. The raw sugar market has remained virtually 
unchanged in thè last eight years, turnover on thè white sugar market 
has doubled in thè same period with over nine million tonnes. It is

-  8 -
now approaching a volume equìvalent to half of thè net import 
requirement on thè free world market. This market trend was a 
decisive factor in thè attainment of thè volume of Community exports,  
of which more than 90% consist of white sugar. Even if, on account 
of thè difficult generai world economie situatìon, thè demand for 
white sugar in thè near future ceases to clìmb as strongly as it has 
done until now, thè conditions for Community exports of white sugar 
should remain relatively favourable.
II. Trend on thè Community sugar markets (2)
Producjt ion_follows_worldjnarkeJt trend
15. Following thè rise in prices on thè world market in 1980/81, thè area 
under sugar beet in thè Community increased in 1981/82 by 12% to reach 
2,03 million ha. Thanks to excellent yields, sugar production 
increased by 23% to over 15 million tonnes.
The fall in prices oh thè world market in 1981/82 prompted producers 
to reduce thè area under sugar beet in 1982/83 by 9,3% but, thanks to 
even higher yields than thè previous year, production reached almost 
14 million tonnes.
The fact that world market prices remained at extremely low levels in 
1982/‘ '3 caused proàv.cere to reduce thè area under sugar beet by a 
further 9,2% in 1983/84. At thè same time thè yield per hectare fell 
back to an average ievel. As a consequence production sank to 
11 ir'llion tonnes.
This igure is to bj compared with an average of 12,3 million tonnes 
for ine chree marketing years preceding thè application of thè current 
basic Rogulation.
ties are exprer>sed in terms of white sugar. (2) All quftnl

- 9 -
Xhis averag© comprises llt2 million tonnos of A and B quota sugar and
I, 1 million tonnes of C sugar. As thè total of th© A and B quotas 
was reduced by thè Council with effsct from thè 1981/82 marketing year 
by barely 2%, production of A and B sugar also remained very stable.
Xt fluctuated between 11,5 million tonnes in 1981/82 and 10,9 million 
tonnes in 1983/84 (thè sum of thè quotas allocated amounted to
II, 76 million tonnes).  The increase in production mainly concerned C 
sugar, output of which rose to 3,5 million tonnes.
The net return_of sugar beet determi_nes_trend_in sugar beet_cultivation
16. An analysis of thè situation (see following table) in thè three 
marketing years preceding thè entry into force of thè new basic 
Hegulation and thè three marketing years which followed shows that for 
thè six years as a whole there was a very definite relation between 
thè price obtained in one marketing year for C sugarbeet, and to a 
lesser extent for B sugar beet, and thè areas sown for thè following 
year.
Price obtained for
sugar beet compared Area under sugar beet
with thè basic price = 100 Community of Nine (2)
Sugar beet Variation compared
A B C (1) 1000 ha with previous
marketing years
1978/79 100,0 70,0 39,6 1.750 - 0,8 %
1979/80 100,0 70,7 76,5 1.756 + 0,3 %
1980/81 100,0 92,1 107,6 1.777 + 1,2 %
1981/82 98,0 68,0 63,6 1.984 + 11,6 %
1982/83 98,0 60,5 48,5 1.799 - 9,3 %
1983/84 98,0 60,5 1.628 - 9,5 %
(1) Estimated on thè basis of thè world market trend in thè prices of 
white sugar.
(2) Since thè statistics below cover thè medium term, thè figures for 
Greece - which joined thè Community in 1981 - have not been 
included.

- 10 -
When one conslders thè size of thè B levy and thè fact that thè price 
of C sugar beet fluctuated between 40% and 108% of thè basic price for 
thè marketing year in question, it is not surprising that sugar beet 
producers should react so fast and so decisively as regards their 
sowings.
Storage policy_facilitate8_staggerin& of_Bur£lu 8_di_s£ 08als_
With production standing at thè levels quoted in paragraph 15, 
preferential imports amounting to 1,3 million tonnes and consumption 
stable at around 9,6 million tonnes, thè quantities available for export 
(not counting those in Storage) fell from 6,7 million tonnes in 1981/82 to 
5,6 million tonnes in 1982/83 and to 2,8 million tonnes in 1983/84.
The situation in 1981/82 of large quantities available for export combined 
with a depression on thè world market prompted thè Community (producers 
and Commissioni to stagger exports thè availabilities over several 
marketing years.  This was achieved by means of voluntary carry-overs by 
producers (1,0 million tonnes of C sugar) and a Commission-imposed ceiling 
on quota sugar export commitments. It is only now, after thè smaller
harvest of 1983/84, that thè quantities held back during thè two pravious 
marketing years can be taken into consideration.  Thus,  provided exports 
this year are limited, thè-stabilization of actual exports at 5,2 million 
tonnes in 1981/82 and 1982/83 will permit stocks to return to normal levai 
at thè end of thè 1983/84 marketing year. In considering these figures, 
it should be borne in mind that 40% of these quantities were made up of C 
sugar which is exported directly by producers without any financial 
intervention by thè Community.

-  11  -
ExEenditure covered by_producers_levi.es.
In 1982 total expenditure on sugar amounted to 1.242 millìon ECU and in 
1983 to 1.316 million ECU. According to thè budget, it wìll be 
1.417 million ECU in 1984.
Roughly one—third of this sum is needed to finance thè re—exportation of 
sugar imported duty-free, more particularly from thè ACP countries. 
Expenditure on sugar produced in thè Community in thè three vears referred 
to above has been almost entirelv covered bv producer levies (c.f.
thè table below).

-  12 -
BUDGETARY EXPENDITURE AMD REVENUE POR SUGAR
(in million ECU)
1982
(1)1983
<1>1984
(2)TOTAL
1982-84
XGlobal situation
1. Total expenditure 
of which:1241,8 1316,2 1417,0 3975 ,0
2. For re-exporting preferentìal 
sugar 330,0 455,0 455,0 1240,0
3. For sugar produced in thè 
EEC (1. - 2 .  > 911,8 861,2 962,0 2735,0
4. Revenue from sugar levies (3) 705,8 948,0 1003,3 2657,1
5. Difference (3. - 4.) - 206,0 + 86,8 + 41,3 - 77,9
IISpecific situation
1.a) Export refunda of which :
b) For re-exporting preferentìal 
sugar
c) For sugar produced in thè 
EEC <  a) - b) )742.5 
330,0
412.5758,1
455.0
303.1974.0
455.0
519.02474.6 
1240,0
1234.6
2.Production levies (3) 276,9 469,4 521,6 1267,9
3 .Difference < 2. — le) ) - 135,6 + 166,3 + 2,6
4 .Storage coste reimbursements 489,9 550,5 424,0 1464,4
5 .Storage levies (3) 428,9 478,6 481,7 1389,2
6.Difference (5. - 4.) - 61,0 - 71,9 + 57,7 - 75,2
7 .Other expenditure (OSD, food 
aid, Chemical industry) 9.5 7,6 19,0 36,1
(1) Actual expendi ture and revonue.
(2) Expenditure and revenue under 1984 budget included a credit of 
30,1 million ECU in section 100.
<3) According to thè Council decision on 21.4.1970 (Decìsìon about own 
ressourcea) thè Community repays to thè member States 10 % on levies 
collected as collectlng costa.

- 13 -
The absence of absolute correspondence in thè budget is to be 
explained chiefly by thè exìstence of dìfferent rulee regarding 
deadlines for thè payment of export refunds and thè repayments of 
Storage costa on thè one hand and for thè payment of levies on thè 
other. It should be borne in mind that in determinìng thè slze 
of levies any balance, whether positive or negative, for thè 
previous marketing years is carried forward to thè following year 
in accordance with thè rules laid down by thè Council.
Ili.  CONCLUSIOMS
1. The present production System was established by thè Council in
order to reach essentially two main objectives: on thè one hand
to gear production to available market outlets and on thè other to 
cover thè whole of thè cost of marketing Community surpluses with 
financial contributions from producers themselves.  With these 
objectives in mind, thè Council laid down basic quantities A and B 
for thè period 1981/82 to 1985/86 and various related measures, 
while keeping open thè option of reviewìng thè position at thè 
half—way mark and possibly revising thè basic quantities on thè 
basis of a proposai from thè Commisslon and an opinion from 
Parliament.
2. Experience since 1981/82 has shown, first of all, that thè present 
arrangements have secured a tangible adjustment of production, in 
particular to outlets on thè world market. This is made apparent 
by thè drop in thè area in beet in 1982 and 1983 to reach thè 
lowest figure since 1975. Secondly, thè machinery to implement 
thè present system, partlcularly caryovers,  and Btorage resulting 
from thè day- to-day management of thè quantities exported under 
Community guarantee have made it possible to spread thè disposai 
of some exceptional surpluses over several marketing years.

- 14 -
3. On thè financlal side, thè budget figures for 1982-84 show that 
over severel budget years thè objective of having thè aector 
finance itself has in a large extent been attained, if one leaves 
out of account thè expenditure for which producers do not bear 
financlal responeibility such as spending on exports to offset 
imports of preferential sugar. The resulta will be even batter 
over thè whole flve-year perlod because it is likely to include a 
phase of high prìces on thè world market, which has seen cyclical 
price movements over several decades.
4. From thè foregolng ìt appears that there ìs no need for a change 
in quotas at this stage either in terme of disposai on thè market 
or in terme of financing. This analysis and thè conclusione now 
drawn from it by thè Commlssion confirm those drawn by thè 
Commission at thè end of July 1983 in ite communication to thè 
Council on thè common agricultural policy as regards thè sugar 
sector, namely that no adjustments vere necessary for thè time 
being after thè market organization had been reviewed by thè 
Council in 1981 and renewed for a period of five years (cf.
COM(83) 500 final of 28 July 1983, point 4.6).
The Commission implicitly reafflrmed this posìtlon in January 1984 
by not including any related measures in its price proposals for 
thè sugar sector in 1984/85, proposals which it stressed were 
entirely in tune with COM<83) 500 final.
5. With regard to possible accession to an International Agreement on 
sugar, neither thè negotiating directives given to thè Commission by 
thè Council nor thè state of thè negotiations at present 
presuppose an a priori modification in thè Community arrangements 
for thè Bugar sector.

- 15 -
In this context, thè Council itself stated as early as 1981 that thè 
Community would joìn an International Agreement which was compatìble 
with existing Community rules in thè sector. The lateet discussione 
on this on thè basic of guìdelìnes set out by thè conference chairman 
show clearly that there is no need for such a revision. The way of 
calculating reference export availability (REA) for which thè 
Community is arguing involves taking ite actual exports in thè three 
marketing years from 1980/31 to 1982/83, which come to 5,4 million 
tonnes expressed as raw sugar. If this is offset against thè maximum 
surplus produced under A and B quotas of 2,1 million tonnes raw sugar, 
plus preferential importa of 1,4 million tonnes raw sugar, a total of 
3,5 million tonnes, there remains a balance of 1,9 million tonnes raw 
sugar for export entirely within whatever C sugar is produced.
The Commission therefore Comes agaìn to thè conclusion that presently, 
even under thè terms of any commitments flowing from Community 
accession to a new International Sugar Agreement, no revision of 
quotas will be required during thè lifetime of thè present System, 
which expires on 30 June 1986.

- 16 -
ITALIAN MEMORANDUM ON THE SUGAR 3BCTOR
1. At thè Council meeting of 18 and 19 October 1982, Xtaly presented a paper 
entitled "Memorandum on thè sugar sector" <Council doc.  No 10224/82 
restricted AGRIORG 521). The Council held a first debate on thè metter 
on 18/19 October and a second on 13/14 Decomber 1982, when it was 
suggested that thè issues raised in thè memorandum could usefully be 
discussed when thè Council carne to consìder thè roport which thè 
Commission must present to it under Artide 24(7) of Regulation (EEC)
No 1785/81.
The memorandum starts by pointing out that thè situation on thè world 
sugar market has progressìvely deteriorated since thè compromise arrived 
at in June 1981, one of thè resulta of which was thè quota System 
establis'ned by Regulation (EEC) No 1785/81 for thè perìod 1 July 1981 to 
30 June 1986, and that this situation was not likely to improve in thè 
short term. Secondly, Italy notes that when thè Regulation was drawn up, 
introducing new production norme, neither thè Commission nor thè Member 
States foresaw that thè world market trend would be so negative. In this 
situation, Xtaly Btates, thè Community faces an increasing financial 
burden if production under quotas were to continue as at present over thè 
next few marketing years and if,  as Italy thought likely, thè 
international market saw no tangible improvement. It must be expected, 
Italy goes on,  that thè negative financial carryover would go on 
increasing uneontrollably deBpite an application of thè B production levy 
at ita maximum level of 39,5% of thè intervention price, with thè 
prospect of an enormous deficit in 1986 to be met by producers or thè 
EAGGF.  Xtaly considera that thè Council should Immediately adjust thè 
current rules with regard not only to thè scale of surplus production but 
also to thè System for financing thè disposai of surpluses. Italy 
stresses that, in spite of its low A quota, it carried over from 1981/82 
ite highest percentage of C sugar (52%) and reduced thè area planted to 
thè level of five years earlier (255.000 hectares) while thè Member 
States tradltionally in surplus had had very low carryovers or none at 
all, at thè same time as keeping a much greater area in beet than in thè 
years preceding thè new production régime. Not only was thè balance 
between sugar-growing areas and less-favoured areas compromised: thè
declared aim of containing surplus production had also been thwarted.

- 17 -
Italy also felt that thè fInaneing arrangiente,  being bassd solely on 
quotas which took no account of consumption, vare no longer relevant since 
thè principio of placing full re?poneibilìty on producere had been 
introduced. Once thè EAGGF etopped hearing thè coet of disposine of 
surpluses, Italy argues in suhetance, thè Community could no longer 
legitimately ask some producers to pay for thè surpluses produced by others.
Finally, Italy stressed thè fact that Italian producere were no longer able 
to bear thè burden of production levìes aa they were already in 
conaiderable difficulty as a reault of high production costa in both 
agriculture and industry aa well as thè amali yìelds typical of production 
in thè Mediterranean regione.
To deal with theae imbalanceB, Italy proposed in ita memorandum that thè 
System introduced by Regulation (EEC) No 1785/81 should be revised so that 
all Member States were allotted A quotas corresponding to natlonal 
consumption, i.e. thè Member States in surplus would reduce thè area in 
beet by thè necessary aroount.
2. In generai tenne,  thè Commìssion considera that Italy*s proposals amount to 
a complete abandonment of thè commitments undertaken by thè Council in 1981 
for thè five following marketing years and hence constitute much more than 
a s 1 inpie revision of thè A and B quotas under Artide 24(7) of Regulation 
(EEC) No 1785/81.
Turning more speciflcally to Italy itself, it should be noted that thè 
trends in both production and consumption since 1980/81, thè marketing year 
on which A quotas were based, do not argue for an increase in ita basic 
quantity A. First of all, only Italy*s basic quantity A was increased in 
1981 (by 90.000 tonnes) while these quantities were frozen for thè other 
Member States. Secondly, Italy*a present overall production quota (A + B) 
of 1,57 million tonnes is comparable to total consumption, which was 
1,63 million tonnes in 1980/81, 1,50 million tonnes in 1981/82 and 
1,52 million tonnes in 1982/63. Italy*s production went from 1,78 million 
tonnes in 1980/81 to 2,05 million tonnes in 1981/82 and 1,18 million tonnes 
in 1982/83. Production in 1983/84 is forecast at about 1,25 million tonnes.

- 18 -
Setting quotas in relation to national consumption would in any case run 
counter to thè idea of a common market.
Finally, thè actual pattern of production since 1982 almost completely 
negates thè argumeut that quotas should be related to consumption because 
of thè financial burden on Xtalian undertakings as a result of rising 
production levies. On thè one hand, production of B sugar has become 
marginai and, on thè other, thè so-called mixed pricing System (allowed by 
thè basic Regulation) has been operated at national level which offsets 
much of this burden. It should also be remembered that Italian producers 
receive consideratale national aid and that production levies taken as a 
whole correspond to only a email fraction of thè total volume of such aid.
3. The Coitimission nevertheless recognises that a great part of thè sugar
industry in Italy is in a very criticai position. Actually 44 X of sugar 
production are affected by financial difficulties.  A concrete 
manifestation of tl ;  s is thè fact that there vere long delays before beet 
growers were paìd fo‘‘  produce froxn thè 1982/83 crop. As for thè 1983/84 
crop, many of them may not be paid at all because of thè lack of financial 
resourceB (some undertakings being bankrupt or on thè verge of 
bankruptcy).  This Berious situatlon in which thè Italian sugar industry 
finds tcolf is bound to have serious repercussione on thè agricultural 
sector and will heavily influence thè decisione of beet growers as to 
whethe. they should continue with this enterprise.
The Ctinmi3sion seen no way at present of solving these problema in thè 
conte:: c  o r thè common organization of thè market.

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The Commission is aware,  however,  that thè Italian Government has decided 
to tackle thè ss difficulties by submitting a f rasnework law to thè Italìan 
Parliament providing, in eseence, for thè creation of a financlng company 
based exclusively on State funds whose job it would.be to take shares in 
varioue private-sector undertakings stili to be set up under a pian to 
regtructure thè sugar industry with thè aim of maintaining sugar production 
and beet cultivation.
This restructuring pian has been approved by thè italian Government after 
broad-based consultations with all thè parties involved. This pian 
provides for thè closure of seven sugar factories by 1985 and five further 
factories by 1988 as well &s modernization of thè remaining plant.
This restructuring operation appears justlfied considering that its 
purpose is to maintain beet growing in Italy while keeping beet production 
within present quotas as far as industriai processing capacity is 
concerned. The Commissìon would like ìt understood that any opinion in 
favour it might give under Artide 92 and followìng of thè Treaty to this 
framework law would leave thè Italian Government and thè other parties 
concerned full responsibility for carrying it out. It also considera that 
such opinion in favour would not be capable of being construed as 
recognition of any production targete set by thè Italian Government or of 
justifying clairas for backing in achieving suchstergete.  On these terms,  
thè Commission believes that thè pian would not conflict with Regulation 
(EEC) No 1785/81, which expressly provides in Artide 25 for restructuring 
plans.

-  20  -
TABLEAU 1 :  BILAN HONDIAL DU SUCRE
(en millionsde tonnes en sucre brut)
1978/79 1979/80 1980/81 1981/82 1982/83 1983/84
(estimation)
1 -Production 90,7 84,9 88,1 100,6 100,5 95,9
2.Consommation 89,5 89,9 89,6 92,3 94,1 95,6
3-ProductionfconSoramatior + 1,7 - 5,0 ~ 1,5 + 8,3 + 6,4 + 0,3
C 1. - 2.)
4-Importations 26,4 28,3 28,7 31,6 29,0 28,0
5 -Exportations 26,8 29,2 28,3 31,9 29,6 28,4
6.Stocks finaux 31,2 25,3 24,2 32,2 38,0 37,9
7-Stocks finaux en X 34,8 28,1 27,0 34,9 40,4 39,6
de La consommation
Source :  F.O. Licht (estimation au 14.2.1984)

-  21  -
TABLEAU 2: Evolution de la production de sucre dans la CEE
EUR-10, en 1000 t de sucre blanc
1978/79 1979/80 -1980/81 1981/82 1982/83 1983/84 (p)
I. production réelle
1. surface betteravière 
(1000 ha) 1.796 1.800 1.805 2.026 1.838 1.668
2. rendement
(t.sucre blanc/ha) 6,51 6,78 6,63 7,26 7,42 6,44
3. production totale 12.100 12.582 12.262 15.028 13.942 11.004
II. production aux termes du 
règime des quotas
1. somme des quotas A attribués 9.426 9.426 9.426 9.516 9.516 9.516
2. production de sucre A 9.293 9.295 9.084 9.382 9.366 9.271
3. somme des quotas B attribués 2.555 2.442 2.592 2.242,2 2.242,2 2.242,2
4. production de sucre B 1.949 1.795 2.111 2.125 2.053 1.661
5. production de sucrs C 882 1.570 1.190 3.520 3.508 1.154
dont reportée à la campagne 
suivante 78 124 990 1.083 206
à exporter 804 1.446 1.190 2.531 2.425 948
6. Production de sucre A + B par 
rapport à la consommation (en %) 114,4 114,0 117,3 119,9 120,5 115,4

-  22 -
TABLEAU 3:. Bilans d^approvisionnement en sucre de la CEE
EUR-10, en 1000 t de sucre blarc—  == = = = =- = _===- = =--:ìi = = -- = = = -== = -- = == = ==============[ ============== =============- =============== ===============^
Campagne:1er octobre/30 septembre 1978/79 1979/80 1980/81 1981/82 1982/83 1983/84
<P>
1. Stock initial1.453 1.545 1.818 1.145 2.616 3.019
2. Production réelle 12.100 12.582 12.262 15.028 13.942 11.004
3. Importations des pays tiers :
à) en l'état (ACP + autres) 1.266 1.330 1.162 1.372 1,333 1.345b) sous forme de prodults transformés 148 173 ■  158 ' v 160 ■ "  160 160
4. DISPONIBILITES 14.967 15.630 15.400 17.705 18.051 15.528'
5. Consommation 9.824 9.724 9.544 9.597 9.474 9.474
6. Exportations sous forme de
'  298 produits transformés 306 2Q0 290 309 309
7. Solde (4*. - (5.+6.)4.845 5.600 5.576 7.818 8.268 5.745
Idontl :
a)Stock final1.573 1.833 1.131 2.635 3.061 1.486 - 2.144
b)Exportations sucre A+B en l'état 2.468 2.321 3.254 2.653 2.782 3.311 - 2.653
C) " " Q m ii804 1.446 1.190 2.531 2.425 948 - 948
d> " totales £b) + c)"7 3.272 3.767 4.444 5.184 5.227 4.259 - 3.601
7® Exportations CEE par rapport aux
13,3% 14,0% exportations mondiales (3) 17,1% 17,7% 19,2% 16,3% - 13,8%
; = = = = = = = = = ---= -= = = = -- _____________________sssssrsrsssss; ============== — — — — — — — — _ _ _ _ _ _ _ _ _ _ _ _ _ J
(1) Pour Italie et Grèce; 1er aout/31 juillet
(2) Stock final y comprH le solde des èchanges INTRA/CEE
(3) Par référence aux données de F.O.LICHT

~  d.5 -
«ORLO SUGAR: PROOUCTION, CONSUMPTI ON, STOCKS ANO PRICE

- 24 -
PR1X DU SUCRE BLANC SUR LE MARCHE MONDIAL ET DANS LA CEE