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Sugar worldwide is trading at the highest prices since 2011, mainly due to lower global supplies after unusually dry weather damaged harvests in India and Thailand, the world’s second and third-largest exporters
Nigerians are facing skyrocketing sugar prices that have left an indelible mark on the prices of bread. Bakers are struggling to stay afloat while enduring higher costs for fuel and flour.
Sugar is needed to make bread, which is a staple for Nigeria’s 210 million people. It offers a cheap source of calories. Surging sugar prices — an increase of 55% in two months — means fewer bakers and less bread. Bread is often the only food poor households can afford. When bakers raise bread prices, as they did by 15% earlier this year, some people go hungry.
Sugar worldwide is trading at the highest prices since 2011, mainly due to lower global supplies after unusually dry weather damaged harvests in India and Thailand, the world’s second and third-largest exporters.
Nigeria, for instance, buys 98% of its raw sugar from other countries. In 2021, it banned imports of refined sugar that ran counter to a plan to build up domestic sugar processing and announced a US$73-million project to expand sugar infrastructure, which are long-term plan.
The United Nations Food and Agriculture Organization is predicting a 2% decline in global sugar production in the 2023-24 season, compared with the previous year. This translates to a loss of about 3.5 million metric tons (3.8 million U.S. tons). Increasingly, sugar is being used for biofuels like ethanol, so global reserves of sugar are at their lowest since 2009.
Brazil is the biggest sugar exporter, but its harvest will only help plug gaps later in 2024. Until then, import-dependent countries — like most of those in sub-Saharan Africa — remain vulnerable.
India endured its driest August in over a century, and crops in the western state of Maharashtra, which accounts for over a third of its sugarcane production, were stunted during the crucial growing phase. India’s sugar production is likely to decline by 8% this year, according to the Indian Sugar Mills Association.
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In Thailand, El Nino effects early in the growing season altered not just the quantity but also the quality of the harvest, said Naradhip Anantasuk, leader of the Thailand Sugar Planters Association. He expects only 76 million metric tons (84 million U.S. tons) of sugarcane to be milled in the 2024 harvest season, compared with 93 million metric tons (103 million U.S. tons) this year.
