Global sustainable sugarcane production shows significant growth: report

Ottawa, January 29, 2020 – Corporate sustainable sourcing commitments of leading food manufacturing companies are increasing demand for voluntary sustainability standard (VSS)-compliant sugar, with the sector experiencing a compound annual growth rate of about 52% from 2008 to 2016, accounting for over three per cent of total sugarcane production in 2016. This is according to a new report released today by the International Institute for Sustainable Development (IISD).

About 90 per cent of VSS-compliant sugarcane comes from Latin America, specifically Argentina, Brazil, Costa Rica, and Paraguay, with substantial volumes also deriving from Australia, India and Malawi. Developing countries account for about three-quarters of global sugar consumption. Asia and Africa are considered the top demanding regions due to population increases, urbanization and income growth, and dietary patterns shift. These demographic changes are expected to increase demand for sugar in the coming years, specifically in the form of caloric sweeteners, processed products, sugar-rich confectionery and soft drinks.

“The sugarcane industry is an important source of livelihoods for around 100 million people across the world,” said Steffany Bermudez, co-author of the report and IISD Associate.  Over one million are in Brazil, accounting for nearly 25 per cent of its rural workforce. In Thailand, the sugarcane supply chain provides jobs for 1.5 million people, including 107,000 smallholder farmers, and around a half million people in South Africa depend on the sugarcane industry for their livelihoods. 

However, the sector must overcome significant hurdles to produce VSS-compliant sugarcane. These include limiting air pollution and greenhouse gas emissions, conserving water resources, respecting labour rights and worker health and safety, and improving producer profitability.

Sales of VSS-compliant sugar have not kept up with production, posing another challenge for the growth of this commodity applying sustainable agriculture practices. This is likely due to consumers being unwilling to pay higher prices for their favourite foods and drinks coupled with companies wary of marketing VSS-compliant content due to the negative health perceptions of sugar.  “To combat these issues and contribute to the increase in consumer purchases of VSS-compliant sugar products, educational campaigns, price incentives and targeted procurement programs should be established,” added Bermudez. “Incentives should also be created for increased demand of VSS-compliant sugar within the largest producing countries, such as Brazil, China and India.”

The new report is the fourth in IISD’s Sustainable Commodities Marketplace Series, which presents sustainable production and consumption market information on agricultural commodities to foster transparency, knowledge and strategic decision making for sustainable development. The first three reports, focused on coffee, cocoa, and tea, are online. Future reports will focus on the production of bananas, cotton, palm oil and soybeans.