| Sugar producer Tate & Lyle today issued its fourth
profit warning in a year, blaming dissolving US margins and big rises in
energy prices since November.
It said energy costs for the year to March would be 10 million more
than the 30 million it predicted in November. Margins had fallen further
than expected at two US sugar businesses, Western and Domino, which it is
trying to offload.
The group claimed that US authorities had artificially propped up the
price of raw sugar for growers while refined prices plummeted. American
rival Imperial Sugar is currently in a Chapter 11 bankruptcy protection
procedure.
Analyst David Lang of Henderson Crosthwaite said: 'It's nothing the
management has done. It's a political problem which needs politicians to
sort out. That won't happen for some time.'
Even in the group's core businesses there was precious little good
news. Staley, its US corn syrup producer, has managed to lift selling
prices but any extra profit will be partly wiped out by higher corn costs
and energy prices.
An unfavourable product mix at European starch business Amylum will
eliminate any gains from price increases.
Only traditional cane refining businesses in Britain, Portugal and
Canada continued to perform well. |