The European Commission has outlined three possible reform scenarios for the EU's sugar sector, and said it wants to open discussions on the objectives of a new EU sugar regime before proceeding to a formal proposal.

In one of the options, the present regime would be extended beyond 2006. Reduction of quotas, tariffs and prices would be made within the current common market organisation (CMO).

The second option would involve the phasing out of production quotas and the EU internal price would be allowed to adjust itself to the price of the non-preferential imports. The Commission said this price reduction scenario is also analysed with regard to its impact on world trade patterns, and includes the possibility of allowing sugar producers to benefit from the decoupled single farm payment.

Finally, the third option involves a complete liberalisation from the current sugar regime. Producers would be integrated into the single farm payment system. The Commission said the impact on the EU sugar market of the complete removal of import tariffs and quantitative restrictions on imports has been assessed.

"Following the June 2003 CAP reform for major agricultural sectors, the time has come to consider how we can make the present EU sugar sector more market orientated and economically, environmentally and socially more sustainable," Franz Fischler, Commissioner for Agriculture, Rural Development and Fisheries, said.