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Slovenia Rues EU Sugar Reform as Prices Soar

Ljubljana/Ormoz, 10 April (STA) - Slovenia is lamenting its decision to close down its only sugar plant during the EU's sugar reform four years ago as prices of raw sugar hover at the highest levels in 30 years.

Representatives of the government and agricultural sector all agree that Slovenia has lost out by giving up the quota for the Tovarna sladkorja Ormoza, a move that effectively ceased all sugar production in the country.

While the bulk of the EUR 38m in aid it received from the EU for this purpose went to the Dutch owners of the plant, Slovenia is now fully reliant on increasingly unreliable imports for the sweetener.

The EU sugar reform "undoubtedly has not brought benefits" to Slovenia, Minister of Agriculture and Food Dejan Zidan recently said.

By closing the Ormoz plant, Slovenia stopped producing sugar beet, which is now one of the most profitable crops.

The opinion is shared by the Agricultural and Forestry Chamber, which said there was interest among Slovenia farmers for renewing sugar beet production, which had been a well-organised and profitable business.

But Slovenian farmers are unable to restart production before 2015, when the current quota system under which Slovenia agreed to forego all production expires.

This is angering local officials in Ormoz. The mayor in the town, Alojz Sok, labelled the closure of the plant there "a mistake, which caused by a previous mistake to sell the plant to foreigners".

While "smart Western Europe" has stepped up sugar production, "we idiots from the east" have reduced it, he said. "We have all failed the test and I, for one, feel cheated."

Commenting on the recent increase in global sugar prices, the Agriculture Ministry told the STA that the EU's reform cannot be solely blamed for increasing global prices.

The recent 60% increase in the price on global markets has been brought about by the use of sugar for energy production and "various speculation on commodity markets".

The ministry said that supply problems are being experienced foremost by smaller operators lacking long-term contracts.

In 2010, Slovenia imported most of its sugar from neighbouring Croatia as well as Slovakia, Austria and Hungary.

Slovenia used 90,500 tonnes of white sugar in 2010, which is around 45 kg per person, according to the Statistics Office.

In 2006, when the Tovarna sladkorja Ormoza plant was still operational, Slovenia produced 43,400 tonnes of white sugar.

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