Wednesday, November 3, 2010

Supply and Demand Sugar Edition

QUESTION: Why has the price of sugar has jumped to a 30-year high?

ANSWER: Brazilian harvest has tailed off sharply, hardening expectations of a shortage.


  1. And another ag adverse supply shock!

  2. I wonder if this has impacted the demand for substitutes, like brown sugar, Splenda, Truvia and honey, thus increasing the price of those substitutes and ultimately resulting in equilibrium between the price of sugar and its substitutes. Guess with this set-up we are destined to pay more for sweetners. Diabetics are coming out on top in this equation!