The European Commission is expected to issue export licences for a further 119,000 tons of out-of-quota sugar, completing its controversial export of unsubsidised sugar, an EU official said.

The EU authorised the export of an additional 500,000 tonnes of out-of-quota sugar in the 2009/2010 marketing year in January, citing exceptional market conditions as sugar prices soared to their highest in nearly three decades.

Due to strong demand from the market, the Commission granted export licences for over 381,000 tons of sugar on Feb. 17.

If requests in the coming days exceed the 119,000 tons still available, the Commission will apply a "reduction coefficient" to all applications received to bring them within the overall quota of 500,000 tonnes, the official said.

The EU sugar is likely to be offered aggressively, providing tough competition for white sugar from Thailand or the United Arab Emirates.

Top sugar producers Australia, Brazil and Thailand say the EU's out-of-quota exports are illegal under World Trade Organisation rules, and are pushing for an immediate withdrawal of the exports by the EU.

Under WTO agreements, the EU's sugar exports are limited to 1.3 million tons annually. (Reuters)