"The pricing round for Food & Industrial Ingredients, Europe is (as is normal for this time of year) at an early stage," said the company in a statement.
"So far satisfactory progress is being made to recover higher raw material and energy costs."
However, recent comments from the EU Agriculture Commissioner regarding the slow surrender of quota to the restructuring fund have heightened concerns over a continuation of oversupply of sugar in the sugar year ending 30 September 2008.
Against this background, Tate & Lyle now believes that it is unlikely that any recovery in sugar pricing will occur during the 2007 calendar year.
"This reinforces our decision to surrender beet sugar quota at Eastern Sugar, where negotiations are ongoing," said the firm.
On the other hand, Food & Industrial Ingredients, Americas has substantially completed the negotiation of its 2007 calendar year sales contracts.
There was a small loss in sweetener volume as it sought to increase margins in a rising corn market at the end of the negotiating period. Total sweetener margins for the 2007 calendar year are expected to be higher, much as anticipated.
"We also anticipate achieving higher total net margins on both value added food and industrial ingredients," said the company in a statement.
"Our expectations for margins on ethanol sales, which represent a small proportion of Food & Industrial Ingredients, Americas overall sales, remain consistent with our assumptions for our new facility in Fort Dodge, Iowa."
Higher corn costs and lower gasoline prices also means that 2007 ethanol margins are expected to be substantially lower than those achieved in the current financial year.
Furthermore, Tate & Lyle's unaudited interim results have given the firm reason to be confident that stronger growth can be expected in the near future.
Sales for the six months ended 30 September 2006 were up 9 per cent at £2,039 million, mainly due to a strong first half in Food & Industrial Ingredients, Americas and a good performance within Sugars, Europe from sugar trading.
Operating profit before exceptional items and amortisation was up 26 per cent at £193 million for the period, while profit before tax, exceptional items and amortisation was up 27 per cent at £173 million.
Tate & Lyle operates more than 65 production facilities in 29 countries, throughout Europe, the Americas and South East Asia. Sales in the year to 31 March 2006 totalled £3.7 billion.