SAO PAULO, Brazil, Oct 29 (Reuters): Brazil's sugar industry yesterday praised the World Trade Organisation's order that the European Union reduce sugar exports by May 22 to comply with an earlier ruling that branded most of the bloc's sugar exports as illegal.
The Sao Paulo Cane Agroindustry Union (Unica) said Brazilian sugar mills could begin filling the unmet world demand left by European exporters on the world market by 2006.
"It's clear that the time limit is good, it's fantastic," said Eduardo Pereira de Carvalho, president of Unica, which with Brazil's foreign ministry led the WTO challenge against EU sugar subsidies.
The WTO arbitration panel was asked by major sugar exporters Brazil, Australia and Thailand to decide when the EU would have to implement its ruling issued in 2004, or risk trade sanctions.
"There are still small questions to be answered but it (the time limit) is the crowning of a grand process," Carvalho said.
The European Commission, which administers foreign trade for the EU's 25 member states, said it would study the WTO ruling and do its best to comply.
EU agriculture ministers are hoping to agree on a radical sugar reform next month that would go a long way toward WTO compliance and overhaul a subsidy policy little changed since its conception in the late 1960s.
Carvalho said it was not yet clear how the EU would implement the WTO decision but he believed the bloc would respect it.
Carvalho said WTO documents estimated that Brazil is losing $494 million a year under the EU's current sugar export subsidy regime.