Sugar producer Suedzucker's profit drops 85% on weak prices

HAMBURG (Reuters) -Europe's largest sugar producer Suedzucker posted an 85% fall in quarterly operating profit on Thursday, hurt by low sugar prices in the European Union.

The German company reported an operating profit of 22 million euros ($25.82 million) for the first quarter to end-May, down from 155 million euros a year earlier.

It confirmed its previous forecast for full-year group operating profit of between 150 million and 300 million euros, down from 350 million euros in the previous year.

On Wednesday, Suedzucker also said it expected significantly lower second-quarter earnings.

The firm's sugar segment reported an operating loss of 56 million euros in the first quarter against a profit of 59 million euros a year ago.

“The significant decline in results was mainly caused by the downturn in sugar prices,” Suedzucker said, adding lower production costs could compensate for the drop in prices.

EU sugar prices fell to 540 euros a metric ton in May 2025 from 619 euros in October 2024, partly because of imports of cheap Ukrainian sugar to support the country following Russia's invasion. The EU plans to cut imports of Ukrainian sugar by up to 80%.

However, a spokesperson for Suedzucker said: “The EU has still made no final political decision about imports of Ukrainian sugar so we are unable to give an assessment of the impact of any EU restrictions Ukrainian imports,”

“But we expect higher EU sugar prices from the start of the new sugar season in October 2025 because of a significant reduction in EU sugar production due to a reduced beet cultivated area,"

The outcome of negotiations on a higher import quota for sugar from Ukraine are ongoing. This poses a risk, the spokesperson added.

(Reporting by Michael Hogan, editing by Miranda Murray and Sonia Cheema)