Europe is facing a sugar shortage, and food manufacturers are paying dearly to secure supplies after a heat wave crippled local output this year. Producers of sweets, cakes, and soft drinks are paying much more than usual to have sugar in the short term, and the risk of some going out of business has increased. For consumers, it is a threat of further inflationary pressure. Europe, whose shipments have fallen in recent years, could buy from countries in Africa and the Caribbean to alleviate the crisis. More shipments from the main exporting countries, such as Brazil and India, would be another option. However, India has imposed export quotas, while higher ethanol prices have encouraged Brazilian mills to divert more cane to biofuel.
Sources: Bloomberg/Nova Cana (*Translated by Ia Niani)