Sugar Prices Set To Sour
Pour weather could force sugar prices higher.
Food prices as a whole have been on the rise.
Experts are particularly watching the cost of sugar as freezing temperatures ravaged much of the Florida sugar cane crop last last year, and world markets continued to shift.
The crop, just now being cut in Florida, should be green, but it's brown, burned by three nights of freezing temperatures just last month.
"Having freezes in early December is devastating because we still have months and months of harvest to go and we can get additional freezes in January and February that can continue to impact the crop," says US Sugar's Judy Sanchez.
Half the nations sugar cane is grown in Florida, and with 150,000 acres planted in and around Palm Beach County, U.S. Sugar Corporation is the largest cane grower in the nation.
"We're racing the clock because we have about 30-40 days to get that frozen cane processed before we start to lose significant amount of sugar," Sanchez says.
The wicked weather has not only been a problem for sugar growers in the U.S.
In Australia and India, two other major sugar producing nations, bad weather has also reduced crop yields.
That would not be devastating were Brazil to sell all of it's sugar on the world market, but for 35-years and again this year, brazil will divert upwards of 50-percent of it's sugar to ethanol.
Only three years ago there was a larger worldwide supply than demand, but no more.
Emerging economies like India and China have turned the market upside down.
Experts say as incomes climb, so too does the taste for more sugar in food.
In 2003 the average resident in China consumed slightly less than 19 pounds of sugar a year.
Now they're eating nearly 25 pounds.
In India there's a similar sweet tooth that now slightly exceeds the average U.S. consumption of 45 pounds per year.
That doesn't mean we don't like our sweet food in the United States, it's just much of the sugar in sugar cane and sugar beets have been replaced in this country with another sweetener, high fructose corn syrup.