The rising costs of sugar due to the effects of the climate crisis have now impacted cookies and candy.
The issue of climate change has been recognized as a danger to coffee and beer in the past, and it may now also be affecting another beloved aspect of life: dessert.
The worldwide price of sugar has risen to its highest point since 2011 due to worries about low production rates in India, where a prolonged dry period has put crops at risk, and in Thailand, which is dealing with a serious drought. These two nations are the top sugar exporters after Brazil.
The rise in global temperatures, with 2023 projected to be the hottest year on record, is leading to droughts and other severe weather conditions that impact food production, including sugar. This has resulted in an increase in prices for chocolate, candies, and other desserts.
The US Department of Agriculture reported a significant 8.9% increase in prices for sugar and sweets in 2023, with an expected 5.6% rise this year. These numbers are higher than the usual historical averages. In November, Mondelēz, a large company that owns brands such as Cadbury, Oreos, and Toblerone, announced potential price hikes for its products.
According to Bloomberg, Mondelēz CEO Dirk Van de Put stated that consumers will experience a price increase due to the expensive production of sugar and cocoa.
According to Gernot Wagner, a climate economist at Columbia University’s business school, while large corporations may have various reasons for raising prices, the undeniable danger of climate change is a significant factor to consider.
Wagner stated that severe weather is impacting the availability of food. A year ago, avocados were affected and now it is sugar. This phenomenon, known as climate-flation, is becoming more severe. While it may be convenient for the owner of Oreos to attribute price increases to climate change, it is also understandable.
The challenges faced in the production of sugar have been worsened by the possibility of restrictions on exports from sugar-producing nations in order to preserve their own supply, as well as congestion at ports in Brazil, resulting in delayed exports.
The price and import of sugar to the US are affected by various regulations, meaning that the consequences of high sugar prices will be less than in some other countries. The impacts will be most severely felt by developing countries and subsistence farmers, according to Joseph Glauber, a senior research fellow at the International Food Policy Research Institute.
According to Glauber, the prices of sugar are currently at an all-time high and will continue to be until the El Niño event subsides. This climatic phenomenon is expected to intensify global temperatures even more this year.
The main concern will be the ability to afford food. In wealthier countries like the US, households will experience a rise in food costs, particularly for those with lower incomes. However, for countries where 40% of spending is on food, the impact will be even more significant.
There is a worry about the long-term effects of climate change, specifically in terms of shifting crop regions and increased instability in the prices of commodities such as rice and sugar.
Research has indicated that the rise in global temperatures will greatly impede the growth of rice in countries like China, while studies have revealed that the production of corn worldwide could decrease by 24% by 2030. However, fluctuations in temperature and precipitation may benefit other crops, such as wheat, in regions like Russia and Canada where it is currently too cold for successful cultivation.
According to a working paper from the European Central Bank, if significant measures are not taken to adapt to the climate crisis, global food inflation may reach as high as 3% annually by the 2030s. This could have far-reaching effects on the world’s food supply.
Wagner cautioned that the current spike in sugar prices is a reminder that past beliefs about food production may need to be discarded.
“Our food crops have been primarily designed to thrive in the climate of the past 10,000 years, which has been relatively consistent. However, as we move away from this stable climate, we can expect to see a decrease in the availability and increase in the cost of food,” stated the speaker.
As temperatures rise, certain important crops will not decrease gradually but rather experience a drastic decline due to unpredictable weather patterns. I am more concerned about the impact on individuals living on limited resources and small-scale farmers who rely on these crops for their survival. I am less worried about the potential increase in the cost of Oreos by a large food company.