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The "war on sugar"

Sugar had already been the worst-performing agricultural commodity in calendar 2017.

2018 turned out to be a nightmare for sugar producers across the globe. An unprecedented rise in world sugar production by 23.6 mln tonnes year-over-year (local crop year basis) catapulted global output of the sweetener to 201.2 mln tonnes in 2017/18 – the first time ever that production exceeded the 200 mln tonne threshold. Besides heavy supplies, sluggish offtake was another concern for producers. 

It is safe to say that the “war on sugar” accelerated with more countries – including the UK and Ireland – setting into force taxes on sugar-sweetened beverages in 2018. Reformulation of drinks by beverage producers in order to avoid such taxes are affecting sugar use in affected countries, contributing to a slowdown in world sugar consumption growth that is also partly due to a steady reduction in world population growth.

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Macro factors such as the development of crude oil prices as well as the Brazilian exchange rate have been key factors for sugar price moves in recent months and will exert heavy influence this year, too. This is due to the fact that these two measures will play a key role in determining Brazil’s sugar mix in the next 2019 crushing season which will get underway in March or April. Click below for more information on the 'war on sugar' and find out what is in store for 2019.

War on sugar

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