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Economy

Biofuels And Obesity Stir Worldwide Sugar Shortage, Crank Up Prices

Weather problems and growing health concerns in the United States about the dangers of high-fructose corn syrup have led to a global sugar shortage. For consumers, the result has been a bitter increase in prices for the classic sweetener.

Supply shortages are raising sugar cane prices
Supply shortages are raising sugar cane prices

Worldcrunch *NEWSBITES

You may have noticed lately that your morning coffee tastes slightly more bitter than usual. It may have something to do with a 15 million-ton sugar shortage in the face of global demand. In Europe, that's meant a steep price increase – from 550 euros per ton in August 2010, to 900 euros per ton this year.

The most common reason cited for the current supply shortage are weather problems in Mexico, Australia and, most importantly, in Brazil, the world's top producer. Also mentioned as contributing factors are the use of sugar cane for biofuels and increased demand in emerging countries. The situation is so bad right now that the International Sugar Organization announced that even with a good 2011/2012 harvest, sugar stocks will not return to levels considered "healthy."

There is one other major factor affecting world's sugar supply: the surprising end of the long romance between American consumers and high-fructose corn syrup, or HFCS, a sweetener often used in the food industry to replace cane or beet sugar. Growing evidence has linked HFCS to obesity and diabetes. For health reasons, in other words, food producers in the United States are beginning to wean themselves off the corn-based sweetener.

"Growing concern among consumers about high-fructose corn syrup, which is made from government-subsidized corn, is forcing producers, especially soft drink makers, to go back to cane and beet sugar," says Euromonitor, a market research firm. "This tendency away from HFCS is another factor pushing up prices."

The United States is not self-sufficient when it comes to cane sugar. Further complicating matters was the recent disastrous harvest in Mexico, which left U.S. producers without their principal provider. Theoretically, the situation could benefit Nicaragua and Guatemala. The problem there, however, is that unlike Mexico, these countries aren't part of the North American Free Trade Agreement (NAFTA), meaning their exports are subject to quotas and tariffs.

That could change. Euromonitor reports that the U.S. Department of Agriculture said in August that it is considering relaxing import barriers in an effort to close the supply gap.

Read more from AmericaEconomia in Spanish

Photo – Sweeter Alternative

*Newsbites are digest items, not direct translations

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Future

Out With The Car, In With The Urban "Super-Island"

Barcelona architect Ton Salvadó explains how a new way or organizing urban areas might lead to greener, more peaceful cities.

Photo of a man riding a bicycle in a lane reserved for cyclists.

Man riding his bike in Barcelona in an area where cars have been largely restricted.

Ana da Cunha

There's no pristine white sand and palm trees framing turquoise water on Ton Salvadó's "super-islands." When the Barcelona architect uses the term, what he's referring to instead are chunks of city, in nine-block groupings, whose interior streets are closed to cars, forming pedestrian "islands" where foot traffic is king.

The idea for super-islands first emerged when Salvadó became director of Barcelona's Urban Model, at a time when the city was embroiled by civic protests over the high price of housing. After some initial success, Salvadó, a Barcelona-native, might have the chance to revolutionize his city's pedestrian geography with 500 additional super-islands in the future.

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