Sugar prices may rise significantly
Climate damages worldwide delaying sugar cane harvest. Price of sweet substance, which has already made a 76% leap since beginning of year, expected to increase even more
A significant increase of 30%-50% in the prices of sugar may hit the market soon if the global trend and shortage of the sweet substance continues, according to David Franklin, CEO of Sugat, Israel's largest sugar manufacturer.
The International Sugar Organization predicts that the global demand for sugar will exceed its production by about 5 million tons by September 2010, and will lead to the worst shortage in two years.
The shortage stems from climate changes: Rains four times heavier than expected have hit south-central Brazil and are delaying the sugar cane harvest.
In addition, a drop is expected in production in Mexico, Pakistan, India and Thailand due to a weak monsoon seasons. In June, India experienced the worst drought in 83 years.
As a result of these damages, the number of options for purchasing sugar reached $20.85 cents per libra (about 340 grams) last week, and is expected to reach a price of $30 cents per libra by the end of the year. The price of sugar has made a leap of 76% since the beginning of the year.
