Sugar Prices and Supplies

Report Outline
World Sugar Shortage and High Prices
U.S. Quota System; Loss of Cuban Crop
Supply Situation and Sugar Controls
Special Focus

World Sugar Shortage and High Prices

Inquiries into Increases in Price of Sugard

Aspurt in sugar prices in the spring of 1963 moved discussion of food costs from newspaper financial pages to front pages and from grocery check-out counters to the halls of Congress. American housewives were suddenly faced with sharply higher prices for refined sugar and with a prospect of higher prices for ice cream, soft drinks, and other food products having a sugar content. Some consumers, particularly industrial consumers, expected a sugar shortage and laid in extra stocks as protection against still higher prices.

Prompt assurance by the Department of Agriculture that prospective supplies were more than sufficient to enable Americans to go on consuming sugar at the customary rate halted and then reversed the price spiral. But uncertainty over timing of deliveries from foreign suppliers, and a shortage on the world market, kept sugar prices above earlier levels.

World raw sugar prices climbed from the depressed level of less than 3c a pound late last summer to 6.5c a pound last March. Prices of raw and refined sugar rose steadily thereafter on both world and American markets; raw sugar reached 13.2c a pound on the New York market on May 22 and 12.6c a pound on the world market. Wholesale prices for refined sugars reflected the increases for raw sugar, with prices for refined cane rising from less than 10c to 16.3c a pound on May 24. Retail prices soon followed; the cost of five-pound packages jumped by around 30c, or 6c a pound, in some stores. The Consumer Price Index for June showed a somewhat smaller increase; a five-pound package averaged 84c at retail as against 59.4c in February.