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UK farmers cut back growing beet in pricing dispute with British Sugar



Tom Wright’s family grew sugar beet on their mixed farm near Moulton St Mary in Norfolk for more than a century, but this year they have planted none.

“We’ve considered the future of the crop very carefully over the last 10 years, and we know that at the current prices it’s not making money any more,” Wright said. “It’s sad. My family have grown it for five generations, since 1912, and there have been bad times before, but now it really is the end of the road.”

Wright is not alone. After extreme weather and disease ravaged the 2020 crop, some farmers have given up beet growing and others cut back, leading the National Farmers’ Union to predict a fall of 10 per cent to 15 per cent in the area planted in 2021 and warn of potential further cuts in future.

The British sugar beet sector, which produces more than half the sugar consumed in the UK, has also been hit by pricing pressures in part due to EU deregulation four years ago.

All of these factors have led to tensions between farmers and their sole buyer British Sugar, the only processor of UK-grown sugar beet.

Tom Wright
Tom Wright: ‘My family have grown it for five generations . . . and there have been bad times before, but now it really is the end of the road’

In an attempt to help growers hit by virus yellows, the disease that has blighted the crop, the company, a division of Associated British Foods, launched an assurance scheme for growers. But in a tense emergency videoconference in March, farmers told management that it needed to do more.

“We do grow it at our own risk, but growers are looking for some kind of recompense for the sheer difficulties that 2020 brought, and also in the future more of a risk-reward mechanism to support [their] loyalty,” said Michael Sly, chair of the NFU sugar board.

Like others, Lincolnshire grower Andrew Ward argued the future of UK sugar production was at stake: “If they don’t pay more, it will be the end of the UK sugar industry.”

Paul Kenward, managing director at British Sugar, told the Financial Times it was “sobering to hear the individual stories of a very difficult season” and said the company would take farmers’ feedback on board.

Sugar production from UK beets dates back to the 1912 opening of a factory at Cantley, Norfolk. Now, about 3,000 growers across East Anglia and the East Midlands produce about 8m tonnes of sugar annually for British Sugar under contracts negotiated by the NFU.

It is a system different from other UK crops, and has its own quirky language, with the annual winter harvest known as a “campaign” in which beets are “lifted” from the ground.

Kenward said the UK sector has become highly productive: “You get more sugar per acre in East Anglia than you do in Brazil. Our factories are incredibly efficient too.”

Sam Wright
Tom Wright’s great-great-grandfather Sam Wright. The Wright family has grown sugar beet for more than a century

But in recent years the crop has been hit by virus yellows, which is spread by aphids. Farmers said the problem was worsened by an EU ban in 2018 of seed treatments containing pesticides called neonicotinoids, citing a risk to bees.

Member states could still choose to authorise emergency use but pre-Brexit the UK opted not to do so. The government this year gave permission in principle for its use, in a move condemned by environmental groups, although the industry will not use it in 2021 as weather projections indicate the virus will hit less severely.

Meanwhile, prices paid to growers have gradually declined, especially following the EU deregulation.

David Hoyles, a grower in south-east Lincolnshire, said: “The last few years have been more difficult: the price has come down and . . . if you get a poor year, it hits you a lot harder.”

Hoyles added: “With global warming we’ve seen a change in weather patterns, with hot dry spells and wet spells, more extremes, and that has brought other pests and diseases to the crop.” 

British Sugar has increased prices paid to farmers by 70p a tonne this year as global sugar prices rallied and after it reported improved profitability in the financial year to September 2020 “from the unacceptable levels seen over the two years after the abolition of EU sugar quotas in October 2017”.

But the company said the late 2020 harvest was hit by “truly exceptional” weather, including the wettest February since 1914 and driest May since 1868.

Hoyles said the combination of weather and disease caused a 61 per cent drop in yields and the NFU’s Sly put growers’ losses at £45m. Some are replacing beet with oilseed rape or oats.

Close-up of a sugar beet pulled out of the ground
Prices paid to sugar beet growers have gradually declined © Nathaniel Noir/Alamy

James Peck of PX Farms in Cambridgeshire said he started growing sugar beet eight years ago and was the country’s third-largest grower, producing about 82,000 tonnes. But he stopped after losing £640,000 on the 2020 harvest, even though he valued sugar beet’s role in crop rotation, helping to control weeds.

British Sugar said plant breeders are working on varieties that would resist virus yellows. It also hopes the disease can be fought using gene editing, in which DNA sequences are deleted, modified or inserted.

The UK government is consulting on taking a more liberal approach to gene editing than the EU. This would be “the closest thing to a silver bullet” for virus yellows, said Kenward.

British Sugar has left the door open to improved deals with growers. “We are very optimistic for the growing season to come, and I look forward to putting this crop behind us and embracing the many opportunities the industry has to grow profitably together,” Kenward said.

Farmers such as Wright and Peck, however, are looking elsewhere. Wright said his family’s decision to stop growing beet has caused a stir locally because his farm is just four miles from the Cantley factory.

“We’re in an area of historic growing where every farm has grown sugar beet, and we’re one of the first in our immediate area to stop. It’s quite a big thing,” he said.

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A carbon registry leaves polluters with nowhere left to hide




The writer is the founder and executive chair of the Carbon Tracker Initiative, a think-tank

No one yet knows which countries will extract the last barrel of oil, therm of gas or seam of coal. But the jostling has started. Every nation has reasons to believe it has the “right” to continue fossil fuel extraction, leaving others to deal with the climate crisis.

In the Middle East, oil producers can argue that the cost of extraction is low. In Canada, they market their human rights record. Norwegians trumpet the low-carbon intensity of their operations. And in the US under Donald Trump, they touted the virtues of “freedom gas” and called exports of liquefied natural gas “molecules of freedom”.

The dilemma for governments is that if one country stops producing fossil fuels domestically, others will step in to take market share. And so the obligation to contain emissions set out in the Paris Agreement risks being undermined by special pleading.

In the UK, the furore over plans for a new coal mine in Cumbria the year that the country is hosting the UN’s climate summit is indicative of the contrary positions many countries hold. Facing one way the government says it is addressing climate change. But looking the other, it consents not just to continued extraction, but to support and subsidise the expansion of production.

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Where climate change meets business, markets and politics. Explore the FT’s coverage here 

To keep warming under the Paris Agreement limit of 1.5C, countries need to decrease production of oil, gas and coal by 6 per cent a year for the next decade. Worryingly, they are instead planning increases of 2 per cent annually, the UN says. On this course, by 2030 production will be too high to keep temperature rises below 1.5C. The climate maths just doesn’t work.

One of the problems in attempting to track fossil-fuel production is the lack of transparency by both governments and corporations over how much CO2 is embedded in reserves likely to be developed. This makes it difficult to determine how to use the last of the world’s “carbon budget” before temperature thresholds such as 1.5C are exceeded.

Governments need a tool that establishes the extent to which business as usual overshoots their “allowance” of carbon. There needs to be a corrective because the cost competitiveness of renewable energy, and the risk of stranded energy assets, has not stopped governments heavily subsidising fossil fuels. During the pandemic, stimulus dollars have been dumped into the fossil-fuel sector regardless of its steady financial decline, staggering mounds of debt and falling job count. 

This is why my initiative and Global Energy Monitor, a non-profit group, are developing a global registry of fossil fuels, a publicly available database of all reserves in the ground and in production. This will allow governments, investors, researchers and civil society organisations, including the public, to assess the amount of embedded CO2 in coal, oil and gas projects globally. It will be a standalone tool and can provide a model for a potential UN-hosted registry.

With it, producer nations will have nowhere left to hide. It will help counter the absence of mechanisms in the UN’s climate change convention to restrain national beggar-thy-neighbour expansion of fossil-fuel production.

No country, community or company can go it alone. But governments can draw from the lessons of nuclear non-proliferation. First, they must stop adding to the problem; exploration and expansion into new reserves must end. This must be accompanied by “global disarmament” — using up stockpiles and ceasing production. Finally, access to renewable energy and low-carbon solutions must be developed in comprehensive and equitable transition plans.

The choice is between phasing out fossil fuels and fast-tracking low-carbon solutions, or locking-in economic, health and climate catastrophe. A fossil-fuel registry will help governments and international organisations plan for the low-carbon world ahead.

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Hasty, imperfect ESG is not the path for business




The writer is a global economist. Her book ‘How Boards Work’ will be published in May

Good environmental, social and governance practices take a company from financial shareholder maximisation to multiple stakeholder optimisation: society, community, employees. But if done poorly, not only does ESG miss its sustainability goals, it can make things worse and let down the very stakeholders it should help.

To be sure, the ESG agenda should be pursued with determination. But there are a number of reasons why it threatens to create bad outcomes. The agenda is putting companies on the defensive. From boardrooms, I have seen organisations worry about meeting the demands of environmental and social justice activists, leading to risk aversion in allocating capital. Yet innovation is the most important tool to address many of the challenges of climate change, inequality and social discord.

Pursued by $45tn of investments, using the broadest classification, ESG is weighed down by inconsistent, blurry metrics. Investors and lobbyists use different evaluation standards and goals, which focus on varied issues such as CO2 emissions and diversity. Metrics also depend on business models.

Without a clear, unified compass, companies that measure themselves against today’s standards risk seeming off base once a more consistent regulator-led direction emerges (for example, from worker audits, the COP26 summit and the Paris Club lender nations).

ESG is not without cost and the best hope for long-term success lies with business leaders’ ability to stay attuned to its impact and unintended consequences. For example, while the case for diversity is incontrovertible, efforts at inclusion should account for the possible casualties of positive discrimination.

Furthermore, despite ESG advocates setting a strong and singular direction for governance, organisations have to maintain their operations and value while managing assets and people in a world where cultural and ethical values are far from universal. While laudable, a heightened focus on ethics (such as human rights, environmental concerns, gender and racial parity, data privacy and worker advocacy) places additional stress on global companies.

It is often asked if advocates appreciate that ESG is largely viewed from the west’s narrow and wealthy economic perspective. To be truly sustainable, ESG demands global solutions to global problems. Proposals need to be scalable, exportable and palatable to emerging countries like India and China, or no effort will truly move the needle.

Much of the agenda is too rigid, requires aggressive timelines and lacks the spirit of innovation to achieve long-term societal progress. Stakeholders’ interests differ, so ESG solutions must be nuanced, balanced and trade off speed of implementation against the breadth and depth of change.

Business leaders are aware of the need for greater focus and prioritisation of ESG. We also understand that deadlines can provide important levers for senior managers to spur their organisations into action. After all, in the face of pressure for a solution to the global pandemic, vaccines were produced in months instead of the usual 10 years.

I live at the crossroads of these tensions every day. Raised in Africa, I have lived in energy poverty, and seen how it continues to impede living standards globally. As a board member of a global energy company, I have seen much investment in the energy transition. Yet from my role with a university endowment, I have also been under pressure to divest from energy corporations. 

Business leaders must solve ESG concerns in ways that do not set corporations on a path to failure in the long term. They must have the boldness to adopt a flexible, measured and experimental agenda for lasting change. In this sense, they must push back against the politically led narrative that wants imperfect ESG changes at any cost.

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