Sneak Preview: International Sugar Trade

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By: Nadia Ahmad

“You can’t expect both ends of a sugar cane are as sweet.” – Chinese Proverb

This ancient Chinese proverb holds true for not only the varying degrees of sweetness at the ends of a sugar cane, but also for the realities of the international sugar trade. Sugar as a commodity is a major player in the agricultural sector, and the price of sugar impacts markets worldwide.

As one of the most highly distorted agricultural commodity markets, the global sugar market is an ideal place to begin implementing sustainable development practices and creating change with respect to corporate social responsibility (CSR) through guaranteed minimum payments to producers, production and marketing controls (quotas), state-regulated retail prices, tariffs, import quotas and export subsidies.[1] The United Nations Food and Agriculture Organization (UNFAO) reports that although current world sugar prices have largely retreated from the 25-year highs reached in 2006, the market remains susceptible to large demand swings and price volatility. By and large, international sugar prices have trended downward as the production of traditional importing countries increased because of subsidies.[2] Corporate actors in the international sugar trade industry should consider instituting sustainable development practices for not only purposes of the public good, but to enhance their bottom line

If the international sugar trade industry were to alter its farming, labor and business practices, tremendous change would be possible for improved social, economic, and environmental conditions. Despite the volatility of the price of sugar, innovation in agricultural and corporate techniques in the international sugar trade would serve as the launching pad for new and sustainable development practices. With the 2012 United Nations conference on Sustainable Development in Rio de Janeiro, Brazil, (Rio+20), expectations for countries themselves to implement CSR principles were high. While the sugar producing states and companies did not have any specific expectations for the Rio+20 Conference, the sugar producing states and companies can benefit by understanding and implementing sustainable development practices and monitoring CSR trends for the sugar trade industry.

[1] Jennifer Nyberg, Competitive Commercial Agriculture in Sub-Saharan Africa (CCAA) Study: Sugar, International Market Profile, Food and Agriculture Organization of the United Nations, available at (PDF).

[2] See id.

Posted by Stephen A. Moore on Mon. March 10, 2014 8:00 AM
Categories: Food and agriculture, Free Trade, United Nations

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