The Sugar Industry: Food and Fuel for the Masses

Sugar refining is a leading global industry, an agricultural venture producing a substance consumed by billions as a food ingredient or additive, or in alcoholic beverages, and, even more recently, as a fuel extender. Many nations around the world boast of native sugar industries, whether agribusinesses cultivating sugar cane or sugar beets, with the top producers being Brazil, China, India, Australia, Mexico, the European Union, Thailand, and the United States. While the global price for refined sugar remains relatively low, the price in countries which countenance protectionist approaches is relatively high. Trade agreements negotiated between countries without adequate native sugar manufacturing capacity and those with considerable acreage in production are many, complex, and often linked to political motives, international relations, or historical ties. The fact that the U.S. subsidizes its native sugar producers but also maintains favorable dealings with NAFTA members Mexico and Canada has a significant impact on other sugar-exporting countries, especially Brazil. The European Union's decision to comply with World Trade Organization standards has greatly affected sugar refiners in Africa, the Caribbean, and even in faraway Fiji, as the prices quoted for import to Europe have declined significantly. Fiji's sugar industry is already in disarray due to sanctions imposed for political reasons. Additionally, in Brazil, particularly in the Cerrado region, small farms and commercial-scale operations with aggressive expansion plans have been adversely affected by the financial woes related to the current worldwide recession.

Going back to basics for a moment, sugar is considered a consumer staple, an ingredient in food and beverages which form part of the daily diets of most people around the globe. Table sugar is typically refined from either sugar cane or sugar beets. Other sugars used as food additives are derived from plants like corn and palm fruits, from honey produced by bees, from tree sap converted to syrup (sugar maple trees, for example). Because sugar has been marked as a probable culprit in obesity and diabetes, interest in non-calorie or low-caloric sweeteners is high. Plants are also the sources for stevia or Reb-A, under development by PureCircle. Chemical compounds accepted as artificial sweeteners include sucralose and saccharin.

Sugar refining has become a highly mechanized operation, while sugar-cane harvesting remains relatively labor-intensive. Accidents are rare in the sugar plants, although a devastating one claimed 14 lives in Georgia in February 2008. The Port Wentworth operation recently went back online, producing Imperial, Dixie Crystal, and Holly brands of refined sugar. For cane cutters in developing countries like Colombia, Brazil, the Dominican Republic, Pakistan, and Zimbabwe, poor living conditions, including very little access to health care, are the norm. Improving the lot of laborers in the cane fields is rarely part of management or financial considerations; but, in any event, most of the larger concerns are looking into mechanized harvesting options.

Sugar cane plantations require access to a plentiful supply of water. Sugar beet farms and processors use considerably less liquid for refining operations. One example of the importance of the water issue in its most obvious environmental impact is Florida's plan to purchase and reclaim U.S. Sugar Corp. acreage, once devoted to sugar cane farming, in a concerted effort to improve conditions in the Everglades, the vast wetlands ecosystem in the southern part of the state. In Brazil, the diversion of some major tributaries to accommodate newly established sugar cane plantations, particularly ones intended to produce bioethanols, has been reported, with environmental consequences yet to be determined.

Brazil's commitment to ethanol production, spurred by high prices for petroleum, is solid, with notable government support. Foreign investors are interested, even exploring ideas for so-called green plastics, derived from sugar cane byproducts and cane-fields waste. Flex-fuel automobiles operating on high-ethanol content fuel are becoming increasingly common in the South American giant. Exports of biodiesel from sugar-cane ethanol plants to the European Union, where diesel-fueled cars are relatively common, more so than in the United States, and where ethanol use is still rather low, are expected to increase rapidly in coming years.

In summary, the sugar industry, disregarding the newly discovered uses for the product, is a relatively placid and unexciting agricultural business, with minor trade issues and pricing strategies for local and foreign markets. But, when you bring in the intense interest in alternative fuel development, the picture changes dramatically. In the United States, corn is the main ethanol ingredient. But in Brazil, which is quickly devoting vast tracts of land to sugar cane cultivation, sugar is the new black gold.

Maria Luisa Mendonca, "Brazil: sugar cane plantations devastate vital Cerrado region", Pacific Ecologist/Highbeam

"Georgia: Sugar Refinery, Site of Deadly Blast, Reopens", New York Times/Associated Press

"EU says Fiji roadmap may affect sugar assistance review", Radio New Zealand International

Curtis Morgan, "U.S. Sugar Everglades land deal approved", Miami Herald

Matt Peterson, "American Sugar Policy Leaves a Sour Taste", Policy Innovations

Carlos Coutinho, "Brazilian ethanol attracts bioplastics investors", ICIS Chemical Business

"60% of Brazil Sugarcane Being Used for Ethanol this Year", Brazzil Magazine