Sugar Coverage
Sugar cane is an ancient agricultural commodity that has been sustaining sugar cravings across the globe for thousands of years. Today, over 80% of sugar cane is converted into cane sugar and used as a sweetener for a wide variety of food and drinks. The remaining 20% is converted into biofuel, as it is one of the most efficient crops at converting sunlight into energy.
Sugar cane is considered one of the most valuable agricultural commodities in the world. As a result, cultivating and processing sugar cane provides livelihoods for more than 100 million people in 120 countries. However, the value of sugar is much higher than the value of the cane from which it is produced. Low farm gate prices, coupled with high production costs and intense competition, mean that many smallholder farmers in developing countries live in poverty.
These farmers must also grapple with various sustainability challenges, including crop losses caused by climate change, pests and diseases, biodiversity loss, and water depletion. In recent years, they have had to cope with additional challenges brought on by the COVID-19 pandemic and ongoing global economic uncertainty, such as drops in demand and soaring fertilizer and labour costs.
Voluntary sustainability standards (VSSs) such as Bonsucro and ProTerra Foundation have been working to overcome some of these challenges in the sugar cane sector for more than 10 years. These VSSs set sustainability requirements for sugar cane farmers and mills to meet in exchange for certifying their product as VSS-compliant and gaining market recognition. Today, nearly 8% of sugar cane produced complies with one of these VSSs.
However, it is unclear whether VSSs in the sugar cane sector have a significant impact on farmers’ incomes and livelihoods. There is some evidence to suggest that VSS-compliant farmers may receive higher prices when they receive premiums for their produce, but a lack of demand for sustainable cane sugar means that often VSS-compliant sugar is not sold as such—and, thus, without a premium
Heavy regulations in major producing and consuming countries and the complexity of the sugar cane value chain make it difficult for industry stakeholders acting alone to have a meaningful impact. This report provides recommendations for how governments, private sector actors, and standard-setting bodies can work together to make sugar cane production fairer and more sustainable.
Global Market Report: Sugar cane prices and sustainability (2023) View 2020 report
Key Takeaways
Over 100 million jobs
Cultivating and processing sugar cane provides livelihoods for more than 100 million people in 120 countries, particularly in Brazil, Thailand, India, and South Africa.
USD 56 billion industry
1.87 billion tonnes of sugar cane was produced in 2020 from 26 million hectares of land. The market value of the sector exceeded USD 56 billion in 2022.
136 million tonnes
In 2019, at least 136 million tonnes of VSS-compliant sugar cane was produced by more than 37,000 farmers, reaching a farm gate value of at least USD 4 billion.
Two fifths exported
Sugar cane accounts for 86% of global sugar production. An estimated 40% of sugar cane produced is exported, providing an important source of foreign exchange revenue for exporting countries.
Highlights
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Nearly 8% of global production of sugar cane was VSS-compliant in 2019
Growing at a CAGR of around 47% between 2008 and 2019, VSS-compliant sugar cane now represents almost 8% of total global production. This growth has slowed in recent years but is predicted to rise again as demand for sustainable sugar cane grows.
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Progress on sustainable sourcing commitments
The six largest cane sugar-consuming companies bought 16.2 million tonnes of cane sugar in 2020. About a third of that (5.5 million tonnes) complied with a VSS or corporate sustainability initiative. Corporate sustainability initiatives refer to sustainable sugar cane production programs established by private companies rather than by independent third parties.
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VSS-compliant sugar cane production volumes in 2019
The most prominent VSSs in the sugar cane sector in 2019 included in the dataset were Bonsucro (86.18 million tonnes), ProTerra Foundation (62.33 million tonnes), and Organic (4.13 million tonnes).
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Higher prices for VSS-compliant sugar cane
In 2019, sugar cane producers in Brazil, India, and Thailand who complied with Fairtrade International may have received prices up to 13% higher when receiving premiums—rising to 20% higher when certified by both Fairtrade International and Organic.
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Distribution of sugar cane production in the top 15 producing countries in 2019
The Brazilian sugar cane sector produces 40% of the world’s sugar cane (7.5 million tonnes) and employs 773,000 people, which represents a quarter of the rural workforce. The countries producing the next largest volumes of sugar cane are India (4 million tonnes) and Thailand (1.3 million tonnes).