Whilst some major sugar industries continue to benefit from heavy government intervention in their sugar markets to protect rural incomes- consider India, China and the United States for instance - other sugar industries are having to press the reset button for sugar policy, but this is not straightforward. Luckily there are some key lessons for policymakers and other industry stakeholders to heed in any quest to boost industry competitiveness and adapt to changing market environments.
7 Lessons
WKS believes there are 7 key lessons. These are:
1. Beware the pitfalls of continued high levels of support over the long term;
2. Tariffs are the most common method of providing price support;
3. Revenue sharing is the norm, not the exception in cane sugar industries;
4. Direct price support to growers locks in high production costs….;
5. Non-tariff measures and barriers boost protection levels;
6. Outgrowers and smallholders need incentives to boost cane quality;
7. Diversification is a must and requires supportive government regulation and policy.