A 'RADICAL restructuring' is underway in the sugar-beet growing industry.

Following protracted negotiations with the National Farmers' Union, British Sugar announced it has agreed to give farmers a one-off opportunity to sell their sugar beet contracts. The decision affects around 1,200 farms in Yorkshire which produce 12pc of the national beet crop.

"The aim is to make the growing of sugar beet and deliver to British Sugar's beet factories more efficient," said Henry Denchfield, agricultural business consultant with Lincoln-based J H Walter, which is trading contract across the country.

"This is the most radical restructuring of the industry in years, which will produce major changes. It presents growers with a unique chance to look at the viability of their beet operations and the opportunity to take action. So they need to be addressing the fundamental questions:

"Is it profitable? If not, should we relinquish our contract? If it is profitable, should we be looking to buy additional contract?"

The deadline for transfers is October 15.

"There has been some pretty wild speculation about what contract might be worth. Trading is now getting underway and we are currently seeing contract valued at around £45 a tonne," said Mr Denchfield. "We are advising people to make their decisions fairly quickly and, if they're coming out, to get their contract transferred sooner rather than later.

"We anticipate that contract will tend to be concentrated on fewer but larger growers operating on the more favourable soil types but it will be three or four weeks before we see just how big the changes in the industry are going to be."

He added: "I would sound a note of caution to growers who are tenants. Some tenancy agreements specifically prohibit the sale of quotas and contracts. It is very important that if people are in any doubt about their situation that they take professional advice and get it checked out."

Updated: 10:04 Thursday, August 09, 2001