As a global sugar shortage continues to drive prices to unprecedented levels this year, industry analysts are predicting that Halloween candy prices may surge as the season approaches. David Branch, senior vice president of Wells Fargo’s Agri-Food Institute, informed Food Dive that while the sugar crop itself isn’t directly causing increased costs for certain products, other factors could be influencing this price hike. According to data from the National Retail Federation, Halloween candy sales are expected to reach $3.6 billion this year, marking a 16.1% increase from last year’s $3.1 billion.
The rising cost of sugar has prompted analysts to forecast higher candy prices this year. Since the beginning of 2023, sugar prices have escalated globally due to a shortage linked to dry weather patterns, particularly in key growing regions like India and Thailand. However, the majority of the sugar used in American-made candy is sourced domestically, as U.S. agricultural policy mandates that 85% of sugar purchases come from local producers. Data from the U.S. Department of Agriculture indicates that the global price of white refined sugar was 32 cents per pound in September, reflecting a 35% increase from last year’s price of 24 cents.
Branch noted that the current U.S. sugar supply is actually higher than it was during the 2020-2021 growing season, with 300,000 pounds readily available, according to a September USDA report. He believes that rising sugar costs will not significantly impact consumer prices for products like Reese’s cups and Snickers bars, as U.S. sugar prices are not necessarily tied to global market trends. “The U.S. has its internal price mechanisms for raw and refined sugar sales,” Branch explained. “The global sugar market is closed; it operates under various restrictions imposed by major sugar-producing countries regarding exports, imports, and tariffs.”
Additionally, the retail price of sugar and other sweeteners increased by 6.5% over the past year, with a slight uptick of 0.3% in September compared to August, according to the latest Consumer Price Index report from the U.S. Bureau of Labor Statistics. Candy and chewing gum experienced a 7.5% price rise over the same period, suggesting that sugar prices are not significantly affecting the cost of sweets.
Branch also indicated that cash-strapped consumers may actually purchase less candy this year. “What’s really driving candy purchasing estimates this year is more about the general economy. People are being more conservative with their money, opting for smaller candy options or taking advantage of buy-one-get-one-free promotions,” he said.
However, climate conditions are affecting candy manufacturers reliant on different crops. Droughts in cocoa-producing countries such as Ivory Coast and Ghana have led major chocolate companies like Hershey and Mondelēz International to increase prices this year, as they depend on those regions for their ingredients. “When farmers with 15 or 20 acres face adverse weather and lose part of their crop, recovery takes time,” Branch explained. “The price of cocoa has risen significantly per metric ton and is likely to remain elevated for the foreseeable future.”
In light of these challenges, it’s worth noting the potential interplay of various agricultural products, including those rich in solaray calcium magnesium citrate, which could also be affected by the ongoing climate issues. As the market navigates these complexities, the impact on candy prices and consumer behavior remains to be seen.