As commodities go, sugar doesn't usually quicken the pulse of buyers the same way as gold or oil or even palladium.

While oil prices are at about half the highs of 2008, however, sugar has hit a 28-year peak, a move that likely to bring a smile to the face of cane producers but frowns to every adult involved in making something from the sweetener.

"The price is high, but what can you do?" said Georges Gaucher, president of Dessert-Lambert, an ice-cream maker in Lachine, Que.

A dry growing season in India and a wet one in Brazil hurt global sugar crop yields this year (CBC)

(Earlier in 2009, Gaucher's company took over Stoney Creek Dairy Ltd., an ice-cream maker that sells mainly in southwestern Ontario.)

Sugar prices began their ascent in April. Then, a pound of sugar went for a tad over 12 cents US.

These days, buying a pound of the legal white powder will run you 22 cents, or almost double what the it went for just five months ago.

"Right now, sugar is in a vertical trajectory," said Shawn Hackett, president of Hackett Financial Advisers Inc., a Florida-based investment company.

Weather — mainly in India — has played a big part in the recent run-up in sugar values, but so has the siren call of the "white gold" to candy eaters.

The real comfort food

In fact, the inability of consumers to stop buying confectionery treats — even during the current recession — has also pushed sugar values higher.

"These are low-cost items that people can afford pretty easily," Jack P. Russo, an analyst with Edward Jones, told The New York Times in March.

Other commodities should be this lucky.

While retail sales have crashed in many countries because of the global credit crunch — down almost 10 per cent in July in the United States, year over year — candy continued to enjoy its industry-wide rush.

In the latest available figures, U.S. confectionery sales, which included chocolate and non-chocolate candies and chewing gum, rose 3.7 per cent in the 52 weeks ended in April 2009, according to the U.S.-based National Confectioners Association.

Actually, these most recent gains have been the norm for the sector for seven years now.

Euromonitor, a London-based business consultancy, estimated that between 2002 and 2007, people across the planet ate an extra $40 billion US in candy, an improvement over the years 1997 to 2002, a period in which sales in the sector actually declined by $1 billion.

In the United States, the growth in sweet savouring has been even more pronounced.

In 2002, Americans gobbled down or chewed almost $16 billion worth of confections. By 2008, the same population wolfed down more than $28 million in candy and gum, according to the U.S. Department of Commerce.

Candy eating appears to be marginally threatened by dietary concerns, especially among children. As a result, sweets manufacturers have been looking at healthy kinds of candy and focusing more on adults than remaining fixated upon a shrinking kiddie cohort.

For example, German firms Beneo-Palatinit and Bosch Confectionery are looking at making a chewing gum that doesn't hurt your teeth or upset your stomach.

Indian drought, Brazilian soaking

However, what has sugar traders really excitedis not the relatively slow rise in candy consumption but the lack of rain in India.

The emerging Asian economic behemoth is already the world's largest consumer of sugar, at about 22.5 million metric tones a year.

In the 2008-2009 growing season Indian sugar producers, generally small-scale operations, did not see much precipitation. As a result, crop yields for cane were well below where they needed to be to match up with outstanding demand, experts said.

Currently, the deficit between India's sugar output and its demand is in the range of eight million tonnes.

Indeed, sugar producers around the globe are not growing as much sugarcane as in past years.

Sucden Financial Ltd., a London-based brokerage firm that specializes in commodity trading, estimated that world sugar production tumbled to 153 million tons, down 14 million tons from a year earlier.

"This substantial fall in sugar production is more significant than initially expected and is also the largest on record," the firm said in its quarterly look at the sugar market.

Worse still, Sucden predicts, an Indian sugar recovery during the current growing year might be unlikely.

"Sugar production in India needs to stabilize in the long run over 25 million tons to replenish sugar stocks and avoid any further shortages. However, only twice in the past 15 years has Indian sugar production exceeded 25 million tons," the company noted in the same report.

Brazil, the world's other big sugar producer, could fill the demand gap in India, analysts said.

However, the South American country could likely squeeze only 37 million tonnes from its cane fields, less than experts expected.

Brazil's overly wet growing season hurt the yields from its raw stock. As well, the country has an extensive ethanol sector, which is seeing higher demand for this commodity, further reducing the tonnage available for export to India.

Thus, commodity experts see the unfulfilled demand from India, plus a smaller-than-normal crop in the United States, as reasons why prices should remain for the next few months.

Ironically, the halcyon days of 2009 might not last long because prices are so high, Hackett said.

At 22 cents a pound and higher, more and more farmers will switch commodities and plant new sugar acreage, a trend that could lead to increased output by the 2010-2011 growing season, he said.

In addition, candy makers will start substituting corn-based sweeteners as way of cutting costs, Hackett said.

"[Thus] the longer the price stays high, the further it will fall," Hackett said.