Cut sugar supplies and push up prices to incentivise reformulation, report urges

By Katy Askew

- Last updated on GMT

Report urges reduction in sugar availability to spur reformulation ©iStock/lzf
Report urges reduction in sugar availability to spur reformulation ©iStock/lzf
Agriculture and trade policy should be used to limit supplies and push up sugar prices in order to incentivise reformulation, a new report suggests.

The briefing, from the Food Research Collaboration at the Centre for Food Policy, is a call to action for the UK government that argues the UK needs “less and dearer”​ sugar.

According to its authors, Dr Ben Richardson from Warwick University and Jack Winkler, Emeritus Professor at London Metropolitan University, the country needs to cut its sugar consumption by “at least two-thirds”​. To reduce sugar consumption to the recommended level – 5% of daily calories, or about 7 teaspoons – required action on production as well as consumption, they argue.

Brexit: An opportunity to act

Brexit - wildpixel

The UK should reduce how much sugar it grows and imports. This can be achieved through trade and agriculture policy, Professor Winkler and Dr Richardson suggest.

Specific actions that should be implemented include re-establishing the UK’s long standing quotas on UK sugar beet production and the price paid for it. Year-on-year, these quotas should be tightened and the wholesale price of sugar sold to large industrial buyers should be raised incrementally.

Brexit represents an “opportunity to act”​ because Whitehall will replace the European Union’s Common Agriculture Policy (CAP) with an independent strategy.

Indeed, the Department of Environment, Food and Rural Affairs (Defra) stressed the importance of improving public health in its current white paper, ‘Health and Harmony’. “Reducing sugar production is the perfect test of its good intentions,”​ Professor Winkler and Dr Richardson argue.

'People don't like taxes'

In April last year, the Government introduced a tax on soft drinks. This move was widely been credited with increasing the pace at which beverage manufacturers in the UK have reformulated their products. Six months into the new regime, the Treasury revealed it collected £150m in revenue from the tax - less than half the amount it expected - because sugar had been removed from drinks to bring them below the levy threshold. 

However, Professor Winkler suggested that market mechanisms such as supply constrains could prove more politically palatable than further taxes.

“People don’t like taxes and people are voters,”​ he told this publication. “If you start putting taxes on chocolate and other sweet products, this may lead to some political opposition.

“The soft drinks industry levy was very intelligently structured because the government imposed it as a levy on manufacturers not consumers… If you try and extend the idea of putting a visible charge on other sweet products then people may begin to say ‘I don’t like this’.”

In contrast, he continued, agricultural policy is “almost invisible”.

“Nobody understands agricultural policy.”

Target manufacturers, not consumers or farmers

candy sugar confectionery color -karandaev

Professor Winkler stressed that the aim of these proposals is to target large food manufacturers – not farmers or consumers.

Our goal is to give big food manufacturers, the majors who buy 10,000 tonnes of sugar or more [per annum], an economic incentive to reformulate. That is what we are really about," ​he told FoodNavigator. 

Existing support payments that beet growers currently receive could be used to help them shift to healthier crops or develop local rural industries, the briefing suggests.

Meanwhile, if food makers were to push increased prices along to consumers the overall price impact would be “negligible”​, the researchers found.

“Consumers need not suffer. One of the reasons for that is the cost of sugar in the total cost of various sweet products is tiny…. The increase that our proposals would bring would not even register in the weekly shopping bill,​” Professor Winkler elaborated.

However, food manufacturers managing tight margins are “much more price sensitive”​, he believes. “They regularly have cost control or minimisation programmes to keep their margins up. If the price of sugar is incrementally raised and the supply goes down... then we think they will either use less in their products – reformulation – or they will bid up the price. It is really reformulation that we are after.”

Towards a cohesive policy for health and agriculture 

The academics stressed the need to develop a ‘joined-up’ approach to health and agriculture policy.

The report flags “contradictions​” in current UK sugar policy. At present, Defra is trying to raise the production of sugar, while Public Health England is trying to reduce its consumption.

The need for consistency – and “blatant discord”​ between the approach taken by different government departments - is “one of the more startling findings”​ of the study, according to Graham MacGregor, Professor of cardiovascular medicine at Queen Mary University of London and chairman of Action on Sugar.

“It’s imperative that a joined up sugar policy with consistent strategies for the UK is in place.

“Sugar not only lacks any nutritional value, but it contributes to excess calorie intake which leads to weight gain, raising the risk of type 2 diabetes, heart disease, tooth decay and some cancers.”

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