Sugar prices are rising worldwide after bad weather tied to El Nino damaged crops in Asia
Bangkok (AP): Skyrocketing sugar prices left Ishaq Abdulraheem with few choices. Increasing the cost of bread would mean declining sales, so the Nigerian baker decided to cut his production by half.
For scores of other bakers struggling to stay afloat while enduring higher costs for fuel and flour, the stratospheric sugar prices proved to be the last straw, and they closed for good.
Sugar is needed to make bread, which is a staple for Nigeria's 210 million people, and for many who are struggling to put food on the table, it offers a cheap source of calories. Surging sugar prices an increase of 55 per cent in two months means fewer bakers and less bread.
"It is a very serious situation," Abdulraheem said.
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.
This is just the latest hit for developing nations already coping with shortages in staples like rice and bans on food trade that have added to food inflation. All of it contributes to food insecurity because of the combined effects of the naturally occurring climate phenomenon El Nino, the war in Ukraine and weaker currencies. Wealthier Western nations can absorb the higher costs, but poorer nations are struggling.
The United Nations Food and Agriculture Organisation is predicting a 2 per cent decline in global sugar production in the 2023-24 season, compared with the previous year, translating to a loss of about 3.5 million metric tons (3.8 million U.S. tons), said Fabio Palmeri, an FAO global commodities market researcher. 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.
Nigeria, for instance, buys 98 per cent 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 USD 73-million project to expand sugar infrastructure. But those are longer-term strategies. Abuja traders like Abba Usman are facing problems now.
The same 50-kilogram (110-pound) bag of sugar that Usman bought a week ago for USD 66 now costs USD 81. As prices rise, his customers are dwindling.
"The price keeps increasing every day, and we don't know why," Usman said.
It's partly due to the El Nino, a natural phenomenon that shifts global weather patterns and can cause extreme weather conditions ranging from drought to flooding. Scientists believe climate change is making El Nino stronger.
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 per cent this year, according to the Indian Sugar Mills Association. The world's most populated nation is also the biggest consumer of sugar and is now restricting sugar exports.
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 US tons) of sugarcane to be milled in the 2024 harvest season, compared with 93 million metric tons (103 million US tons) this year.
A report by US Department of Agriculture predicted a 15 per cent dip in output in Thailand in October.
Thailand reversed a hike in sugar prices within days, imposing price controls for the first time since 2018. Anantasuk said this would discourage farmers from growing sugar by capping their income.
"It's like preventing the industry from growing, preventing an open competition," he said.
Wholesale prices had been allowed to rise to help farmers cope with higher costs partly due to government demands that they not burn their fields, which makes harvesting cheaper but envelops much of Thailand in heavy smog.
Looking ahead, Brazil's harvest is forecast to be 20 per cent bigger than last year's, said Kelly Goughary, a senior research analyst at the agriculture data and analytics firm Gro Intelligence. But since the country is in the Southern Hemisphere, the boost to global supplies won't come until March.
This is because of favourable weather earlier this year in Brazil along with an increase in areas where sugarcane was planted, according to the USDA.
The next few months are the greatest concern, said the FAO's Palmeri. Population growth and rising sugar consumption will further strain sugar reserves, he said.
The world now has less than 68 days of sugar in stockpiles to meet its needs, compared with 106 days when they began declining in 2020, according to data from the USDA.
"It's at the lowest levels since 2010," said Joseph Glauber, senior research fellow at the International Food Policy Research Institute.
Indonesia the biggest sugar importer last year, according to the USDA has cut back on imports and China, the No. 2 importer, was forced to release sugar from its stocks to offset high prices domestically for the first time in six years, Palmeri said.
For some countries, importing more expensive sugar eats up reserves of foreign currency like dollars and euros that also are needed to pay for oil and other crucial commodities, said El Mamoun Amrouk, an FAO economist.
That includes Kenya. Once self-sufficient in sugar, it now imports 200,000 metric tons (110,000 U.S. tons) a year from a regional trade bloc. In 2021, the government limited imports to protect local farmers from foreign competition, but it reversed that decision as harvests shrank due to insufficient rain and mismanagement.
The amount of sugar milled in Kenya fell steadily from June to August. To compensate, monthly imports doubled from September to October. Meanwhile, a 50-kilogram (110-pound) bag of local sugar doubled in price to
60, shopkeeper Joseph Kuraru said.
Back in Africa's largest economy, the struggle of Nigerian bakers is a microcosm of the effects of rising food and fuel costs and the outsized impact of high sugar prices because it's so ubiquitous. Abuja's many bakeries use sugar both to sweeten cakes and to feed the yeast that makes bread rise.
Bread is often the only food poor households can afford. When bakers raise bread prices, as they did by 15 per cent earlier this year, some people go hungry.
Not passing along higher costs is not an option, said Mansur Umar, president of the Nigerian Bakers' Association.
"There is no way you can buy high and you sell low," he said.
Let the Truth be known. If you read VB and like VB, please be a VB Supporter and Help us deliver the Truth to one and all.
Supreme Court rejects plea for reverting to ballots in elections
New Delhi (PTI): The Supreme Court on Tuesday dismissed a petition seeking to revert to ballot paper voting in elections in the country.
"What happens is, when you win the election, EVMs (electronic voting machine) are not tampered. When you lose the election, EVMs are tampered (with)," remarked a bench of Justices Vikram Nath and P B Varale.
Apart from ballot paper voting, the plea sought several directions including a directive to the Election Commission to disqualify candidates for a minimum of five years if found guilty of distributing money, liquor or other material inducement to the voters during polls.
When petitioner-in-person K A Paul said he filed the PIL, the bench said, "You have interesting PILs. How do you get these brilliant ideas?".
The petitioner said he is the president of an organisation which has rescued over three lakh orphans and 40 lakh widows.
"Why are you getting into this political arena? Your area of work is very different," the bench retorted.
After Paul revealed he had been to over 150 countries, the bench asked him whether each of the nations had ballot paper voting or used electronic voting.
The petitioner said foreign countries had adopted ballot paper voting and India should follow suit.
"Why you don't want to be different from the rest of the world?" asked the bench.
There was corruption and this year (2024) in June, the Election Commission announced they had seized Rs 9,000 crore, Paul responded.
"But how does that make your relief which you are claiming here relevant?" asked the bench, adding "if you shift back to physical ballot, will there be no corruption?".
Paul claimed CEO and co-founder of Tesla, Elon Musk, stated that EVMs could be tampered with and added TDP chief N Chandrababu Naidu, the current chief minister of Andhra Pradesh, and former state chief minister Y S Jagan Mohan Reddy had claimed EVMs could be tampered with.
"When Chandrababu Naidu lost, he said EVMs can be tampered with. Now this time, Jagan Mohan Reddy lost, he said EVMs can be tampered with," noted the bench.
When the petitioner said everybody knew money was distributed in elections, the bench remarked, "We never received any money for any elections."
The petitioner said another prayer in his plea was the formulation of a comprehensive framework to regulate the use of money and liquor during election campaigns and ensuring such practices were prohibited and punishable under the law.
The plea further sought a direction to mandate an extensive voter education campaign to raise awareness and importance of informed decision making.
"Today, 32 per cent educated people are not casting their votes. What a tragedy. If democracy will be dying like this and we will not be able to do anything then what will happen in the years to come in future," the petitioner said.
