w -JLLii JJ Sugar supply chain SECTOR SPECIAL SUGAR Beet Cane 2. Crop Education 18 ISSUE 22 J. 1Production processing clients about what's happening on the Brazilian sugar market, for example. But we can also provide clients with information on the Asian sugar market or what producers are doing in, say, Russia and Ukraine. We simply have the best intelligence on all the subsectors in the F&A industry. And the developments in these various markets trigger behaviour among players right across the market, whether they're producers or end-users." The truth, Duff says, is that there is not one answer for customers in the commodities business, and certainly not for those in the sugar business. Sugar producers in different parts of the world are all facing different challenges. In Brazil, the credit crunch has left quite a few players in dire need of an equity injection to stabilise their capital structure, after making highly leveraged investments in new mill projects. Which is why the country is seeing a wave of M&A activity. "Meanwhile, in the EU the industry is coming to the end of a lengthy reform period that has seen the prices of sugar and sugar beet decline substantially. While at the same time a number of developing countries have been granted greater access to the EU market. This has changed the market in terms of price structure and price volatility, and EU players face both new challenges and new opportunities in dealing with these new market realities," Duff says. 3. Trading marketing This is where Rabobank comes into its own, Bottenbruch says. If a company wants to change its strategy in response to the outlook on the sugar market, Rabobank can help them make that change. Some producers are moving to Brazil because that is where they see future growth. For instance, French company Tereos invested in Brazil in 2000, effectively diversifying its risks. One of Rabobank's German clients has diversified away from sugar to salty snacks. Another, Nordzucker, has decided to take over as much sugar production as they can and recently acquired the sugar operations of Danish rival Danesco. Some are exiting the sugar sector altogether, selling off to bigger players with the scale to deal with fluctuations in the market. "We have THE WORD

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