Sugar prices remain high - despite better harvest
According to experts, consumers must continue to prepare for high sugar prices. In October, sugar cost 24.3 percent more at the supermarket checkout than a year earlier, as the Federal Statistical Office recently reported. Since the beginning of 2010, the price has risen by 82 percent.
However, while prices for other foods are already falling slightly, sugar is likely to remain expensive. "The situation on the global market remains tense," says Günter Tissen, Managing Director of the German Sugar Association. "There will therefore probably be no major change in the price."
The sugar beet harvest, which has been running since September and is known in the industry as the campaign, is expected to produce a slightly better result this year than last year. The European market leader Südzucker from Mannheim estimates that it will at least be back to the average of the past five years.
However, this does not play a role in current prices, says Tissen, whose association includes manufacturers, importers and beet growers' associations. This is because the beet for the sugar that is now being sold came from the previous year. "And the last beet harvest was poor." The long drought in the summer of 2022 put pressure on the harvest volume.
In addition, manufacturers also had to pay farmers more for the beet. This is the only way to prevent farmers from switching to more profitable crops. "Grain prices have recently shot through the roof," reports Tissen. "In this respect, the sugar factories have no choice but to pay more so that the beet remains competitive in the field."
However, there is no shortage of sugar in Germany. According to the association, around four million tons are produced each year in the country's 18 sugar factories. This makes Germany the largest producer in the EU alongside France, says Tissen. "We actually produce more sugar than we need and export it to other European countries."
EU-wide, however, domestic production is only sufficient for 90 percent of demand. Ten percent is imported, mainly from countries such as Brazil. With a share of 40 percent, the South American country is the largest sugar producer in the world. This is also how the recent sharp rise in world market prices reaches Germany, says Tissen. "And we recently reached a 14-year high in the world market price." This is because sugar has been in demand worldwide since consumption has also increased in emerging countries. "Demand is higher than supply."
Consumers can see the result in the supermarket: According to the Federal Statistical Office, food was on average a good six percent more expensive in October than a year earlier. However, only olive oil increased in price more than sugar, at 38 percent. Prices fell for some other foods. Butter, for example, was almost 28% cheaper than in October 2022.
Tissen rejects the idea that more expensive sugar is ultimately also responsible for the price increase in other products. He calculates that a scoop of ice cream contains just one cent's worth of sugar. And in a 100-gram bar of chocolate, sugar only accounts for eight cents. Even doubling the price would only make up a few cents: "The significant price increase in confectionery cannot really be attributed primarily to sugar."
EU sugar market price monitor of the Federal Statistical Office
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Source: www.stern.de
