Policy paper

Review of raw cane sugar ATQ and related considerations

Published 26 November 2025

Introduction

Background

On 1 January 2021, the UK implemented an Autonomous Tariff Quota (ATQ) on raw cane sugar following its departure from the EU. Following subsequent reviews of this ATQ in 2021, 2023 and 2024, the UK maintained the volume level of this ATQ at 260,000 tonnes and the UK Global Tariff (UKGT) rate for refined raw cane sugar at £280 per tonne.

Last autumn, the government committed to reviewing the ATQ, the applied UKGT rate, and coming to a long-term decision from 2026 onwards. To inform these considerations, the government invited stakeholders to submit new evidence and views on policy options during an 8-week stakeholder engagement exercise which concluded in March 2025. The government has considered this information alongside existing evidence submitted in a public consultation which ran in 2024, and internal government analysis.

This document summarises the responses received from stakeholders in the 2025 engagement, 2024 public consultation, and the government’s assessment of factors in coming to a decision on the ATQ and applied UKGT rate.

Policy objectives

In deciding the outcome of the review, the government had regard to the principles set out in the Taxation (Cross-border Trade) Act 2018, namely:

• the interests of consumers in the UK
• the interests of producers in the UK of the goods concerned
• the desirability of maintaining and promoting the external trade of the UK
• the desirability of maintaining and promoting productivity in the UK
• the extent to which the goods concerned are subject to competition

The government also took into account other factors including:

• government objectives relating to our trade ambitions, including the ability to pursue new trading arrangements
• commitments to promote trade with developing countries
• standards
• public health objectives
• the UK’s international obligations

What we asked

Between 21 January and 18 March 2025, the government invited stakeholders to submit evidence and views on policy options regarding the future of the raw cane sugar ATQ and applied UKGT rate from 2026 onwards. Stakeholders were invited to respond via a written questionnaire, of which there were 2 versions.

Full questionnaire

The full questionnaire mirrored the questionnaire stakeholders completed in response to the public consultation which ran in 2024. It asked a wide range of questions relating to domestic sugar production, importing and exporting sugar to the UK, the UK sugar market, policy options and potential impacts. More broadly, stakeholders were also asked questions relating to standards, the government’s public sector equality, and environmental duties.

Short questionnaire

The short questionnaire was a simplified version which included a free-text box allowing stakeholders who may have participated in the 2024 consultation to provide any additional information they felt may be relevant to this review, or explain where they felt their response might be different to their previous responses to the full questionnaire.

Copies of both questionnaires are available at request by contacting sugaratqreview@businessandtrade.gov.uk.

Items covered in this report

This report provides a summary of the responses received by stakeholders in the 2025 engagement exercise and 2024 consultation on the future of the raw cane sugar ATQ and related considerations. The views and evidence provided by stakeholders have been carefully considered alongside internal government analysis.

This document does not contain a list of respondents, or any personal or organisational details. Views have been summarised and care has been taken to ensure that, insofar as possible, these are not attributable to any individual respondent or business.

The government does not intend to publish any individual response submitted by stakeholders to ensure confidentiality. Organisations may publish their own responses independently.

The government received 2 belated responses regarding the future of the raw cane sugar ATQ following the formal close of the engagement exercise on 18 March 2025. While the government appreciates the value of these submissions, these responses have been excluded from the below summary to maintain the integrity of the process and ensure procedural fairness to all stakeholders who adhered to the established deadlines.

Stakeholder engagement

Summary of stakeholder responses

In total, the government received 26 responses to the 2025 stakeholder engagement exercise from representatives of the UK sugar industry, foreign governments, and other interest groups. The contents of responses received varied and covered the potential impacts of policy options and considerations including:

• economic growth
• environmental standards
• the interests of developing countries
• the value of a level playing field for domestic competition
• food security and the diversity of supply in the UK sugar market
• interactions with public health

Similar themes were observed in responses to the 2024 consultation which received 12 responses.

In total, the government received responses from 31 stakeholders across both engagement exercises. Views remain split on the desirability of the ATQ. Of those who responded to these questions:

• 14 indicated they were in favour of an increase in the ATQ volume
• 12 preferred a reduction or removal of the ATQ
• 4 supported maintaining the ATQ volume

One stakeholder did not respond to questions on the future of the ATQ. An overview of stakeholder responses is provided in the following section.

Stakeholder responses

Respondents who were in favour of the ATQ continuing and/or increasing cited various reasons including that, in their view, the ATQ:

• supports the viability of the UK raw cane refining industry and improves competition within the domestic and international sugar market
• would provide greater choice in sourcing raw cane sugar from global suppliers that meet the highest ethical and environmental sustainability standards tariff-free, and improve consumer choice
• along with greater certainty, would help to incentivise investments in productivity, employment, and decarbonisation initiatives in the UK’s raw cane refining industry
• enables a greater variety of supply which supports UK food security, and ensures the UK is equipped to mitigate disruptions in supply chains

Respondents who were not in favour of the ATQ continuing, and/or were in favour of a smaller volume cited that, in their view, the ATQ:

• has disadvantaged UK sugar beet growers by facilitating imports from countries that may not adhere to the same regulations that apply to UK farmers
• has displaced exports from sugar producing developing countries, eroding the value of existing preferential trading arrangements, and may have knock-on impacts on objectives relating to sustainable growth and development as a result
• is unnecessary as there is an oversupply of sugar in the UK market. Some respondents asserted that any demand for raw cane sugar can be met through existing trading arrangements thereby removing the need for an ATQ
• is at odds with wider government objectives relating to public health

With regards to the applied UKGT rate, one respondent asserted that raw cane sugar should enter the UK tariff-free, and without any volumetric restrictions. They argued that the quota-based system limits the ability of businesses to compete fairly and fulfil the UK’s sugar supply deficit that is currently met via imports.

Respondents who were against a reduction in the applied UKGT rate cited a number of reasons including the impact this would have on the UK’s ability to negotiate future trade deals, and distortions in trade that may result from the UK diverging from the Most Favoured Nation (MFN) tariff that is applied by the EU.

Outcome of review of raw cane sugar ATQ and the government’s response

In coming to a decision, the government assessed a range of policy options relating to the volume of the ATQ (increase, decrease and status quo), and its complete removal. The government also examined the applied UKGT rate, and whether any changes were required.

The government has carefully considered responses received in stakeholder consultations completed in 2024 and 2025 alongside the government’s internal analysis. A range of factors including potential impacts to consumers, producers, and wider government priorities were also considered. 

The government examined opportunities to deliver its economic growth mission through trade levers such as the ATQ and ensure the UK’s raw cane refining industry remains competitive while balancing the interests of domestic beet refiners and wider government priorities.

After careful consideration, the government has decided to increase the ATQ volume for annual imports of raw cane sugar to 325,000 tonnes from 1 January 2026. This is intended to be in place until 31 December 2033, and will be subject to review ahead of this date. This is the first increase in the quota volume since its establishment in 2021.

Domestically produced sugar beet constitutes the majority of sugar consumed in the UK. The government does not expect this increase in the ATQ volume to have a material impact on domestic sugar production. The UK relies on some imported refined sugar to meet demand, and our assessment concluded that any additional volume of raw cane imports would largely displace that imported refined sugar rather than impacting domestic production.

Following this review, the current UKGT rate (£280 per tonne) for refining will continue to apply. This is subject to any future review that the government may decide to hold.

The government acknowledges the concerns raised by some stakeholders in their engagement with the 2025, and 2024 ATQ review process regarding competition within the domestic sugar market, trade with developing countries, standards, and public health. Having considered all available evidence, the government has determined the following.

Domestic market conditions and price considerations

Based on internal analysis, the government does not expect an ATQ volume of 325,000 tonnes to have a material impact on domestic wholesale sugar prices. As the UK is a deficit market for sugar, domestic prices are determined by market prices from the most competitive marginal source of imports, ordinarily the EU, in addition to any inward transport costs and tariffs.

The additional quota volume for raw cane sugar is lower than the total volume of white sugar we import from the EU on an annual basis meaning the UK is expected to remain a net importer of white sugar. As such, we do not expect the new ATQ volume in isolation to materially change the market conditions in the UK, and impact consumer prices as a result.

The government acknowledges there is some uncertainty as to how the annually increasing tariff rate quota for raw cane sugar under the UK-Australia free trade agreement may interact with the decision to increase the ATQ volume. The government will closely monitor trade flows and the UK sugar market for any unintended impacts.

Trade with developing countries

The government is aware of evidence which demonstrates a sharp decline in raw cane sugar imports from African, Caribbean, and Pacific (ACP) countries under preferential trading arrangements following the introduction of the ATQ in 2021, and the risk a larger ATQ poses in further displacing their exports. The government also recognises the importance of ensuring the UK raw cane refining industry remains competitive and a viable export market for ACP countries.

The government has carefully assessed these risks and concluded that an increase to the ATQ is beneficial at this juncture to ensure the competitiveness of the UK’s raw cane refining industry. This decision will enable the UK to access a greater volume of more competitively priced raw cane sugar and provide traders relief in associated import costs. The government remains committed to its objectives in promoting development through trade, and will continue to monitor trade flows for unintended impacts ahead of the next planned review of the ATQ.

ACP countries will continue to be entitled to duty-free access (except where stipulations or quotas apply) for raw cane sugar and all other goods other than arms and ammunition either through Economic Partnership Agreements (EPAs), or through the comprehensive preferences tier of the Developing Countries Trading Scheme (DCTS), where applicable under the rules of that scheme.

Standards

The government remains committed to upholding robust food safety standards and we will not compromise on these in our trade policy. Nothing in this decision on the ATQ volume will affect the current import requirements for sugar. Any agricultural imports coming into the UK will always have to meet our high sanitary and phytosanitary (SPS) standards.

Public health

There is no evidence to suggest the ATQ has had any direct consequences on public health since its implementation.

Although intakes of sugar in the UK currently exceed recommended levels in all age groups, consumption has been on a long-term downward decline. The government does not expect the new ATQ volume to materially shift the price dynamic in the sugar market, nor have any direct impact on sugar consumption and public health as a result.

ATQ administration

Some stakeholders argued that the ATQ should be administered via a licensing system to create a more transparent and predictable quota allocation process, ensure regulatory compliance, and promote fairer market competition by preventing the ATQ from being dominated by larger sugar suppliers. 

The government has carefully considered these arguments, but ultimately believes the ATQ should continue to be allocated on a first come, first served basis. A licensing system would impose additional and unnecessary administrative burdens and costs for businesses and may cause unintended market access barriers. A licensing system could also encourage speculators in the market which could lead to an inefficient allocation of the quota.

Next steps

The new ATQ volume of 325,000 tonnes will come into force from 1 January 2026. This is intended to be in place until 31 December 2033 and will be subject to review ahead of this date. This quota will continue to reset annually and will operate on a first come, first served basis.

The current UKGT rate (£280 per tonne) for refining will continue to apply. This is subject to any future review the government may decide to hold.

The government will continue to monitor trade flows in the meantime to ensure its trade policy balances the interests of all parties.

The government is grateful to those who have taken the time to engage in this year’s review of the raw cane sugar ATQ, and will continue to engage with industry through dedicated channels.