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The EU Sugar Policy Regime and Implications of Reform

Author

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  • Elbehri, Aziz
  • Umstaetter, Johannes
  • Kelch, David R.

Abstract

The European Union’s sugar policy, in place since 1968, underwent its first major reform in 2005 in response to mounting and unsustainable imbalances in supply and demand. The reform, however, targeted only a few policy instruments (intervention price cut, voluntary production quota buyout, and restrictions on nonquota sugar exports), while leaving other key policies unchanged (interstate quota trading, sugar-substitute competition, and import barriers). Consequently, the extent of the reform’s impact is limited, compared with more far-reaching alternatives, particularly when the oligopolistic nature of the industry and its noncompetitive pricing behavior are taken into account. A model-based analysis suggests that the reforms by themselves are unlikely to induce price adjustments sufficient to reduce overproduction unless quotas and/or high tariffs are reduced.

Suggested Citation

  • Elbehri, Aziz & Umstaetter, Johannes & Kelch, David R., 2008. "The EU Sugar Policy Regime and Implications of Reform," Economic Research Report 56457, United States Department of Agriculture, Economic Research Service.
    • Handle: RePEc:ags:uersrr:56457
    DOI: 10.22004/ag.econ.56457
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    References listed on IDEAS

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    1. Chaplin, Hannah & Matthews, Alan, 2006. "Coping with the Fallout for Preference-receiving Countries from EU Sugar Reform," Estey Centre Journal of International Law and Trade Policy, Estey Centre for Law and Economics in International Trade, vol. 7(1), pages 1-17.
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    5. Ellen Huan-Niemi & Jyrki Niemi, 2003. "The impact of preferential, regional and multilateral trade agreements: a case study of the EU sugar regime," ENARPRI Working Papers 001, ENARPRI (European Network of Agricultural and Rural Policy Research Institutes).
    6. Huan-Niemi, Ellen & Niemi, Jyrki S., 2003. "The Impact of Preferential, Regional and Multilateral Trade Agreements: A Case Study of the EU Sugar Regime," ENARPRI Working Papers 25134, European Network of Agricultural and Rural Policy Research Institutes (ENARPRI).
    7. Hertel, Thomas & Hummels, David & Ivanic, Maros & Keeney, Roman, 2007. "How confident can we be of CGE-based assessments of Free Trade Agreements?," Economic Modelling, Elsevier, vol. 24(4), pages 611-635, July.
    8. Elobeid, Amani & Beghin, John C., 2005. "Multilateral Trade and Agricultural Policy Reforms in Sugar Markets (Revised)," Staff General Research Papers Archive 12419, Iowa State University, Department of Economics.
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    Citations

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    Cited by:

    1. Nolte, Stephan & Grethe, Harald, 2012. "Der Markt für Zucker," German Journal of Agricultural Economics, Humboldt-Universitaet zu Berlin, Department for Agricultural Economics, vol. 61(Supplemen), pages 1-14, February.
    2. Tangermann, Stefan, 2012. "Preisanstieg am EU-Zuckermarkt: Bestimmungsgründe und Handlungsmöglichkeiten der Marktpolitik. Gutachten für den Milchindustrie-Verband e.V," DARE Discussion Papers 1203, Georg-August University of Göttingen, Department of Agricultural Economics and Rural Development (DARE).
    3. Taylor, Richard D., 2016. "2016 Outlook of the U.S. and World Sugar Markets, 2016-2025," Agribusiness & Applied Economics Report 242089, North Dakota State University, Department of Agribusiness and Applied Economics.
    4. Taylor, Richard D., 2017. "2017 Outlook of the U.S. and World Sugar Markets, 2016-2026," Agribusiness & Applied Economics Report 256036, North Dakota State University, Department of Agribusiness and Applied Economics.
    5. Koo, Won W. & Taylor, Richard D., 2011. "2011 Outlook of the U.S. and World Sugar Markets, 2010-2020," Agribusiness & Applied Economics Report 115555, North Dakota State University, Department of Agribusiness and Applied Economics.
    6. Koo, Won W. & Taylor, Richard D., 2013. "013 Outlook of the U.S. and World Sugar Markets, 2012-202," Agribusiness & Applied Economics Report 157708, North Dakota State University, Department of Agribusiness and Applied Economics.
    7. Renwick, Alan W. & Revoredo-Giha, Cesar & Philippidis, George & Bourne, Michael & Reader, Mark A. & Lang, Ben, 2012. "Sugar and Spice and all things nice? Assessing the Impact of the 2006 EU sugar regime reforms," 86th Annual Conference, April 16-18, 2012, Warwick University, Coventry, UK 134706, Agricultural Economics Society.
    8. Koo, Won W. & Taylor, Richard D., 2014. "2014 Outlook of the U.S. and World Sugar Markets, 2013-2023," Agribusiness & Applied Economics Report 187188, North Dakota State University, Department of Agribusiness and Applied Economics.
    9. Koo, Won W. & Taylor, Richard D., 2012. "2012 Outlook of the U.S. and World Sugar Markets, 2011-2021," Agribusiness & Applied Economics Report 128037, North Dakota State University, Department of Agribusiness and Applied Economics.
    10. Marlen Haß, 2022. "Liberalising the EU sugar market: what are the effects on third countries?," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 66(3), pages 638-667, July.
    11. Taylor, Richard D. & Koo, Won W., 2015. "2015 Outlook of the U.S. and World Sugar Markets, 2015-2024," Agribusiness & Applied Economics Report 201311, North Dakota State University, Department of Agribusiness and Applied Economics.
    12. Nihed Ben Khalifa & Abdessalem Abbassi & Ahlem Dakhlaoui, 2024. "Evaluating the Impacts of Subsidy Removal by Using a Linear-Quadratic Storage Model: the Case of Tunisian Sugar Industry," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 15(1), pages 4673-4690, March.

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