Suedzucker CEO sees sugar prices rising -paper

FRANKFURT, April 12 (Reuters) - Suedzucker (SZUG.DE: Quote, Profile, Research), Europe's largest sugar company, is expecting prices for sugar to rise again, helped by scarcity on the world market, the company's chief executive told a German newspaper.

"After the harvests in Asia have turned out to be bad, prices for sugar will rise again globally," Theo Spettmann told Frankfurter Allgemeine Sonntagszeitung in an interview.

Spettmann said that Suedzucker is not afraid of the second round of price cuts adding that the company could offset the cuts by cutting costs.

Heavy production cuts caused by the EU reforms have already led to the closure of 14 of the company's plants in Europe, Spettmann said.

He also said that the company's specialty segment is developing "very well" and that above all, starch and bioethanol are the main growth drivers. Suedzucker controls CropEnergies (CE2G.DE: Quote, Profile, Research), a German maker of bioethanol.

"By 2011/2012, we are aiming to generate half of our revenue in non-core businesses," Spettmann said, adding that the company is reaching the limits in the sugar business in Europe regarding anti-trust laws.

The company in late March said that the German cartel office had searched its offices as part of a competition investigation, related to the implementation of the EU's sugar market reform. [nLU677775]

Suedzucker previously said it aimed for sales of 5.8-6.0 billion euros ($7.70-7.97 billion) of sales and an operating profit of 230-260 million euros in the financial year 2008/2009 that ended February 28. [nLE484169]