France's largest sugar group, Tereos, said it currently expects yields from this year's French beet harvest to exceed the five-year average despite the lack of rainfall.France, the European Union's largest agricultural producer, faced drought and high temperatures this summer, with part of the country experiencing a third heat wave.

"In France, crop development progressed without problems during the 2022 season, despite the reduction in rainfall, and as things are currently, the average season yield is expected to exceed the average for the past five years," Tereos said in first-quarter results, according to Reuters.

Final yields in the fall harvest, however, will depend on the weather in the coming weeks, according to the company. The severe summer weather in France has raised fears of crop losses, although concerns have focused on other crops, such as corn (corn), particularly in the southwest.

Sugar beet production should be reduced by a fall in the planted area, with Tereos noting that planting is expected to decrease for the fifth consecutive year.  The trend towards less sugar beet planting has led Tereos to see a possible reduction in sugar processing capacity in France. Meanwhile, rival Cristal Union plans to increase prices paid to producers to secure sufficient supplies.

Tereos reported a doubling of principal profit in the first quarter through June 30, as high market prices offset rising raw material and energy costs. In Europe, sugar prices continued to rise in the second quarter, while the region's ethanol market remained underpinned by a structural supply deficit, the company said.

Source: RPA news