The deadlock in negotiations for a new international agreement on sugar prices was broken in Geneva yesterday when Cuba accepted a compromise proposal on export shares.
The aim of the new agreement is to stabilize the market by bringing demand and supply into balance at prices which are fair for producers and reasonable for consumers. A glut of sugar has depressed the world price to an uneconomic level of around 7 cents a pound.
The hardest bargaining at the conference was over the amount by which individual producers should cut back their exports in order to restrict supplies coming on to the market, and force the price up to a range of 11 to 21 cents a pound envisaged in the new accord.
Under the proposal, the maximum cut in export tonnages will be 15 per cent for producers which depend mainly on the free market for seiling their output.
Producers which have large domestic consumption or special trading arrangements for selling sugar outside the free market will face cuts exceeding 15 per cent in times of oversupply. In return, they will have first priority for filling shortfalls in supply due to other exporters being unable to fulfill their entire export quotas.