Global sugar prices hit multi-year high
Who says sugar is tasty ? It is no more tasty, and it is rather sour. Yes, the sugar prices have zoomed by nearly 100% in the last 12 months, and this month, they have reached a multi-year high or rather multi-decade high.
The world’s largest producer and exporter of sugar is Brazil, and that country faced a drought in parts of the country in the beginning of 2009. The world’s largest consumer of sugar is India, and that country faced a huge shortfall in domestic production in the year 2009, due to massive failure of annual monsoon rains.
That forced India to become a net importer of sugar from the international markets, and needless to say it was importing in ship loads which was never seen for years together. That lead to the international sugar prices zoom to multi-year high this month.
Experts indicate that the sugar prices cannot sustain the high levels for more than two or three months, because new supplies would start from Brazil by April. Also the new season production in India and Brazil also could be higher than last year since the monsoon predictions are far better.
Major sugar consuming industries like chocolate makers are also expected to cut down on their inventory levels over the coming months, once better production indications are confirmed by the sugar production bodies in India and Brazil.
So sugar can turn sweeter for sugar consumers, and may turn sour for the producers in the year 2010. That is subject to the monsoon not failing in either of the two major producers of the world.