Committee Reports > List of Committees > Joint > 1979 > Committee on Commercial State-Sponsored Bodies > Report No. 05 - Ceimicí Teoranta

APPENDIX 3

MEMORANDUM FROM COMHLUCHT SIÚICRE ÉIREANN TEORANTA ON THE OPERATIONS OF CEIMICÍ TEORANTA

1. Ceimicí Teo. and CSET are both involved in the manufacture of natural sweetners, namely glucose and sugar. There are many common final customers in the major market segment of the Irish confectionery business. To an extent, glucose and sugar are substitutable products in such markets, and there is therefore a degree of competition for outlets among end users in the sugar-goods sector. For some uses, glucose and sugar are complementary. Sales of sugar to manufacturers in the home market far exceed those of glucose.

2. Relations between Ceimicí and CSET have traditionally been good. The scale of operations of Ceimicí Teo. are small compared with sugar, but apart from an interest in a common market place, there are other features that are similar. By contrast with present free trade conditions, before EEC entry, sugar was, in effect, protected by a licensing system and glucose protected by tariffs. In recent years, it has been particularly necessary to pay attention to the difficult commercial position of the sugar using industries arising from intense competition in confectionery and other products on the home market due to increased import penetration.

3. In addition, both companies have a common accumulated experience of processing operations in widely dispersed locations throughout rural Ireland, and both are engaged in a chemical process activity in the food industry based on agricultural raw materials. In fact, both as semi-state companies originally had a mandate to provide outlets, in the case of CSET, for the growing of sugar beet, and in the case of Ceimicí, for the disposal of potatoes.

4. In EEC conditions, there will always be a potential threat from imports in the natural sweetners area. This competition can come from foreign companies engaged in manufacturing or selling directly competing products, from other starch-based products such as isoglucose, and from synthetic sweetners.

5. It is desirable, however, in the long-term national interest that the Irish market for both sugar and glucose and for related products remain under effective Irish control. It may be that there is scope for a more comprehensive maize/starch processing industry in Ireland with a variety of end and by-products, and possibly foreign companies would have a role to play in providing technology and export outlets. However, from the viewpoint of CSET, it would not be desirable for a situation to arise in the future whereby foreign interests would obtain a commercial position in this country which would enable them to influence developments in areas such as sugar-beet and cereals and the processing industries associated with them.

3 July 1979.