Coke’s shift to cane sugar would be expensive, hurt US farmers

By Marcelo Teixeira, Karl Plume and Renee Hickman

NEW YORK (Reuters) -A possible move by Coca-Cola , and other beverage and food industries, to use cane sugar instead of corn syrup as a sweetener would be difficult and expensive to implement, while mostly negative for farmers in the United States.

U.S. President Donald Trump said on Wednesday that Coca-Cola had agreed to use cane sugar in its beverages in the country after his discussions with the maker of the top soda pop brand.

Health Secretary Robert F. Kennedy Jr. and activists from his Make America Healthy Again (MAHA) campaign have been pushing for changes in ingredients used by the food and beverage industry, claiming the proposed substitutes are healthier.

Kennedy has said the consumption of both sugar and high fructose corn syrup are unhealthy, and scientists say sugar presents some nutritional benefits over high fructose corn syrup.

Coca-Cola already sells Coke made from cane sugar in other markets, including Mexico, and some U.S. grocery stores carry glass bottles with cane sugar labeled “Mexican” Coke.

In response to Trump’s comment, Coca-Cola said “more details on new innovative offerings within our Coca-Cola product range will be shared soon.”

PepsiCo also said on Thursday it would use sugar in its products like Pepsi beverages if consumers want it.

Industry analysts, however, said changes in the formulation of the rest of the Coke sold in the U.S., and other beverages and candies, would involve significant adjustments to companies’ supply chains, since corn syrup and sugar come from different producers. It would also involve changes to product labeling, and cost more.

“Food and beverage industries started to use corn syrup in the U.S. in the past because of costs. It is cheaper than sugar,” said Ron Sterk, a senior editor at SOSland Publishing, an information provider for the ingredients industry in the U.S.

He said the beverage industry uses 55% High Fructose Corn Syrup, or 55HFCS, while bakers use 42% HFCS.

The Corn Refiners Association said the complete elimination of high fructose corn syrup from the U.S. food and beverage supply would cut corn prices by up to 34 cents a bushel, resulting in a loss of $5.1 billion in farm revenue.

“The resulting economic shockwave would lead to rural job losses and significant economic consequences to communities across the country,” CRA said.

Agricultural processors such as Archer-Daniels-Midland and Ingredion, two of the largest HFCS producers, grind corn at mills dotted around the Midwest farm belt to produce corn sweetener and other goods like ethanol biofuel. Shares of both companies fell on Thursday.