Suedzucker shares soared to five-month highs after the sugar-to-fruit giant lifted “significantly” its forecasts for full-year results, thanks to winning bets on grain prices by traders at its ethanol business.

The German-based group, which is Europe’s biggest sugar producer, lifted to E8.9bn-9.3bn, from E8.7bn-9.1bn, its forecasts for group revenues in the year to February 2023.

Ebitda will reach E760m-860m, compared with a previous forecast of E660m-760m, and ensuring growth from the E692m achieved in the last financial year.

Shares in the group stood 5.1% higher at E11.04 in afternoon deals in Frankfurt.

‘Exceptionally good results’

“The significant improvement in the forecast is being driven primarily” by the ethanol division, CropEnergies, and the special products business, Suedzucker said.

CropEnergies, in a separate statement – lifting its own full-year ebitda forecast to E205m-255m, from E105m-155m – said that it had achieved E98n in ebitda in the March-to-May quarter alone, up from E25m a year before, and thanks to locking in prices of grain, a key raw material, ahead of Russia’s invasion of Ukraine.

CropEnergies’ sites include the UK’s Ensus ethanol plant, which has capacity for turning more than 1m tonnes of corn or lower quality wheat a year into biofuel.

“The main reason for the exceptionally good results were price hedges for raw materials and energy, which had already been entered into before the start of the Ukraine war and the associated sharp rise in raw material and energy prices,” CropEnergies said.

Russia’s invasion, in late February, sent London feed wheat futures, on a spot basis, soaring by more than 60% to a mid-May record high of £361.00 a tonne.

The July lot, the current spot contrast, stood on Wednesday at £299.75 a tonne.

‘Will weaken noticeably’

CropEnergies added that the windfall from the low-fixed grain price would wear off as hedges ran out.

“The positive impact on earnings of these early hedging positions will weaken noticeably in the coming months.”

Suedzucker said that it had achieved ebitda of E230m for the March-to-May quarter, growth of 90% year on year, on revenues up 29% at E2.25bn.