MW Trump's push for cane sugar in Coca-Cola puts spotlight on a sensitive market for sweeteners
By Myra P. Saefong
High-fructose corn syrup is a cheaper alternative to sugar
As it turns out, Coca-Cola is far from fully replacing high-fructose corn syrup with cane sugar - but President Donald Trump's push to change the sweetener used in Coke has thrown a spotlight on a commodity market that has been subject to strict government oversight since the 1930s.
It also highlighted how any large-scale shifts in demand could send ripples through a market that could be widely felt by consumers.
On July 16, Trump posted on Truth Social that he had been speaking to Coca-Cola Co. (KO) about using real cane sugar in Coke in the United States, and that the company had "agreed to do so." As it turned out, the beverage company said it will introduce a product made with U.S. cane sugar in the fall to expand its offerings - a move nowhere near as impactful as a full shift away from high-fructose corn syrup (HFCS).
Read: 'If I was writing the checks at Coke, I wouldn't write the check for this,' one expert says about cane-sugar Coke
The move, however, suggests that there's potential for bigger changes in the market for sweeteners, and possibly higher demand and prices for sugar in the works.
"Any surge in cane-sugar demand, weather disruptions or new trade policy could tighten supply," said Jake Hanley, managing director and senior portfolio specialist at Teucrium.
'Any surge in cane sugar demand, weather disruptions or new trade policy could tighten supply.'Jake Hanley, Teucrium
U.S. sugar production was forecast at 9.195 million short tons for the 2025-26 marketing year, while total use, including exports, was forecast at 12.165 million short tons, according to the U.S. Department of Agriculture's July World Agricultural Supply and Demand report. The department forecast 2025-26 imports of 2.481 million short tons, which would lift total U.S. supply to 13.808 million.
The U.S. has never been self-sufficient when it comes to sugar production and must rely on imports to meet market demand each year, according to the Sweetener Users Association, which represents American food companies that use sugar to make their products.
The nation imports sugar under a system of import quotas, which are also called tariff-rate quotas, it noted. These set limits on how much sugar can be shipped into the country every year, with imports above this level subject to an extremely high tariff.
"If the price of sugar rises, it will squeeze the profit margins of sugar users, and at some point that will likely have to be passed along to the consumers, which may inhibit or reduce people's sugar intake," said Sal Gilbertie, chief executive officer and president at Teucrium.
He suggested that may the goal of Robert F. Kennedy Jr., secretary of the U.S. Department of Health and Human Services, who has referred to HFCS as a formula for making people "obese and diabetic."
That's particularly worrisome given that U.S. consumers already pay prices for sugar that are higher than much of the rest of the world, noted Robin Shaw, analyst at financial-services firm Marex.
Futures prices for sugar No. 11 (SB00) traded on the ICE Futures U.S. exchange - the global benchmark for raw-sugar trading - settled Friday at 16.29 cents a pound. The most active sugar No. 16 (SFN00) futures contract, which prices physical delivery of U.S.-grown raw cane sugar at one of five U.S. refinery ports, settled Friday at a much higher 37 cents a pound.
U.S. prices for sugar are higher because of certain laws, implemented by the government as far back as the 1930s, that control imports and production in an effort to support domestic producers and to help stabilize the overall market for the sweetener.
The domestic sugar market operates under a "tightly controlled framework established by the Jones-Costigan Act of 1934," said Teucrium's Hanley. Today's system features "USDA-set nonrecourse loan rates, strict tariff-rate quotas and marketing allotments" - all designed to stabilize prices and manage supply.
The latest iteration of the rules governing the sugar market is the Agriculture Improvement Act of 2018 - also known as the Farm Bill - which is a multiyear law that governs many agricultural and food programs.
The USDA can make loans available to sugar processors of domestically grown sugarcane and sugar beets. For the 2025 fiscal year, that national average loan rate was set at 19.75 cents per pound for raw cane sugar and 25.38 cents for refined beet sugar, while also accounting for some regional adjustments.
So if sugar prices are not above a certain level, U.S. producers have the option to essentially sell their sugar to the U.S. government, said Marex's Shaw. That influences the price of sugar for U.S. consumers.
And with the U.S. price of sugar that much higher than the rest of the world, it made sense for companies that use sweeteners to substitute sugar with HFCS.
Read: Are you prepared to pay 10% more for Coca-Cola? That could be the result of a switch to cane sugar.
For example, the USDA pegged U.S. retail refined sugar prices at $1.0123 per pound for the first quarter of this year, and the U.S. price for bulk HFCS for the Midwest market at 35.21 cents a pound.
Sugar is more accessible elsewhere in the world - with India, for one, producing four to five times more sugar than the U.S., according to Jon Davis, chief meteorologist at Everstream Analytics. The U.S. isn't even in among the top five sugar-producing countries because other crops are more profitable, and its weather is not favorable for sugarcane as other areas of the globe, he said.
The U.S., however, is "by far the largest consumer of HFCS," accounting for about two-thirds of global usage, said Davis.
Meanwhile, Shaw said HFCS has been "used for decades without problems of any kind, despite a sort of whispered campaign suggesting that it caused health problems." If there was huge shift in usage - if the entire U.S. made a switch to sugar from HFCS, for instance - the "logistics would be horrendous," he said.
Read: We asked readers how they prefer their Coca-Cola. Only 2.8% chose high-fructose corn syrup over cane sugar.
Still, for a reasonably small tonnage, such as under 1 million metric tons, a switch in sweeteners would not be a problem, Shaw added. If Coca-Cola is going to launch a new product with cane sugar, this will be just one product among many, and "unlikely to use more than a few hundred-thousand tons at most."
If more companies make the switch to sugar, however, that would be "extremely bullish for world sugar prices," he said, assuming the market saw "proof of any real shift in usage."
But making that change isn't as easy as flipping a switch, according to Hanley of Teucrium, which counts the Teucrium Sugar Fund CANE among its exchange-traded fund offerings.
Converting large-scale HFCS-dependent operations is "complicated," he said. "Manufacturers would face reformulation, equipment upgrades and logistics adjustments."
At the same time, HFCS "remains cost-effective and easy to handle," Hanley added - meaning the incentive for companies to switch to sugar, in the absence of regulatory or economic drivers, remains low.
-Myra P. Saefong
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July 26, 2025 08:00 ET (12:00 GMT)
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