Due to be implemented in 2006/07, the regime will cut the minimum price of white sugar by 39% and sugar beet by 42%.
A spokeswoman for Cadbury said that it was “too early to say” whether consumers would benefit, despite analysts estimating that the company could make savings of £70m a year.
“We welcome steps to make the sugar industry more competitive but we are talking about something that will not be implemented until 2007,” she added. A spokeswoman for the Biscuit Cake Chocolate and Confectionery Association said: “The nature of the competitive retail environment tends to be that cost savings are passed on.”
Sugar processors were more forthcoming with Tate & Lyle estimating that operating profits could be reduced by £60m in 2008, while Associated British Foods predicted a £40m shortfall by 2007/08.