In 2006, the EU introduced a restructuring mechanism intended to reduce overall production of sugar, acknowledging the then global over supply and resultant low prices being achieved. Ireland secured €353 million as part of the reform package with some €220 million being distributed to beet growers and a further €6 million to machinery contractors in the sector.
As part of the reform of the CAP, agreement was secured on the abolition of sugar quotas from 30th September 2017. From that date, investors in the European Union, including Ireland, are free to invest in sugar producing capacity if they wish.
Since 2006, a number of groups have expressed an interest in the redevelopment of the sugar sector, two of whom prepared desktop feasibility studies between 2010 and 2011. In their findings, both proposals sought to develop a new sugar and bioethanol production facility with capital costs, estimated at the time, of between €250 and €400 million.
In 2018, Beet Ireland sought to engage with interested growers in an equity partnership proposal to develop a sugar processing facility in the southeast. However the group announced in June 2019 that it was postponing its plans.
The Department continues to monitor market trends in the sector but it must be noted that the landscape has completely changed since Ireland exited sugar production and EU sugar quotas were abolished. Sugar prices remain depressed due to an oversupply in the world market.
The Deputy will appreciate that any proposals to re-establish sugar production must be industry-led and would need to be supported by a robust business case, having regard to low price being achieved globally for sugar and associated market issues, to attract the substantial level of funding required to support and underpin a new start-up of the scale required to re-establish the sector in Ireland.