As Big Candy Ditches GMOs, Sugar Beet Farmers Hit A Sour PatchMay 17th, 2016
Sugar, you might think, is just sugar, no matter where it comes from. But not anymore.
About half of all sugar in the U.S. comes from sugar beets, and the other half comes from sugar cane. Now, for the first time, sugar traders are treating these as two different commodities, with two different prices.
It’s all because about eight years ago, nearly all the farmers who grow sugar beets in the United States decided to start growing genetically modified versions of their crop. The GMO beets, which can tolerate the weedkiller glyphosate, otherwise known as Roundup, made it easier for them to get rid of weeds.
They really didn’t expect any problems.
I interviewed David Berg, president of the American Crystal Sugar Co., about this change in 2008. “Most of our buyers, the people who buy sugar for industrial uses — as an ingredient in cereals and candies and baked goods and things like that — they’ve not expressed big concerns about it,” Berg said. “We have not come across any specific place where we’re under any constraints where we can’t sell our sugar.”
Just in the past two years, though, that’s changed. Many food companies have decided to label their products as non-GMO. And because practically all sugar beets in the U.S. are genetically modified, those food products are now using sugar derived from sugar cane grown in Florida, Louisiana or outside the U.S. There isn’t any genetically modified sugar cane.
Deborah Arcoleo, director of product transparency at the Hershey Co., told me that in 2015, “we started reformulating Hershey’s Kisses, Hershey’s milk chocolate, and Hershey’s milk chocolate with almonds, to move from beet sugar to cane sugar, and that’s complete. Now we’re looking to do that across the rest of our portfolio, to the extent that we can.”
Hershey’s is one of the top sugar users in the country, and other companies have made similar moves. It’s been a jolt for American Crystal, which is mainly in the sugar beet business.
American Crystal is a cooperative, owned by sugar beet farmers like Andrew Beyer, from Kent, Minn. Beyer went to the company’s annual meeting earlier this year and was shocked to hear just how many of American Crystal’s customers — those pastry and chocolate companies — were moving away from sugar beets. “They were talking like a third or up to half of them were converting their systems to strictly non-GMO,” Beyer says.
The result has been a remarkable change in the American sugar market. Slowly, but consistently, a gap has opened up between the price of sugar from cane and sugar from beets.
“The current price for beet sugar is about 3 to 5 cents below the price for cane sugar on the spot market,” says Michael McConnell, an economist with the U.S. Department of Agriculture’s Economic Research Service.
It means that buyers are paying 10 to 15 percent more for cane sugar.
Meanwhile, the amount of beet sugar looking for buyers has been increasing, while there’s a shortage of cane sugar. That shortage is bad enough that sugar users, such as candy companies, are asking the USDA to allow more imports of cane sugar to ease the shortage.
Beyer says that he and his fellow sugar beet farmers are thinking about going back to growing non-GMO beets.
They couldn’t do it quickly; right now, there aren’t enough non-GMO seeds to go around. And they would prefer not to do it.
Planting genetically modified sugar beets allows them to kill their weeds with fewer chemicals. Beyer says he sprays Roundup just a few times during the growing season, plus one application of another chemical to kill off any Roundup-resistant weeds.
He says that planting non-GMO beets would mean going back to what they used to do, spraying their crop every 10 days or so with a “witches brew” of five or six different weedkillers.
“The chemicals we used to put on the beets in [those] days were so much harsher for the guy applying them and for the environment,” he says. “To me, it’s insane to think that a non-GMO beet is going to be better for the environment, the world, or the consumer.”
But Beyer says he’ll do it if he needs to. He’ll do what his customers want.