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The circle of sugar

The world's sugar comes basically from two crops: sugar-cane and sugarbeet, and one or the other of them can be grown virtually anywhere in the world. Some 60% of the world's sugar comes from cane, which is predominantly produced in the Third World. The remaining 40% is extracted from beet, grown almost exclusively in the North, especially in Europe. This makes sugar one of the agricultural commodities on which farmers in the North and South are directly competing with each other.

The history of sugar, perhaps more than any other crop, is linked to the horrors of colonialism and slavery. Originating from South-East Asia, sugarcane found its way early - in Roman times - to the shores of the Mediterranean coast. But the real boom started only when Columbus took it to the West Indies. Later the British, Dutch and French also started planting cane in their colonies in the region, and by 1800, the Caribbean was responsible for a full 80% of the world's sugar production, a quarter of which came from the colonies of the British Empire in the region. (4) Production relied heavily on slave labour, for which more than ten million West Africans were shipped to the Caribbean. All this just to satisfy the sweet cravings of the colonizers' relatives back home, who had just learned to drink the products of some other colonial crops - tea, coffee and cocoa - to all of which sugar was added. In the 19th century sugar-cane plantations rapidly expanded into other continents and laid the basis of many developing countries' current dependence on sugar exports.

The history of sugar-beet is much shorter, but no less devastating for the cane producing countries. The beet was present in Europe from the very beginning, as it has its centre of origin in the Mediterranean region. But it was not until the beginning of the 19th century, when the Napoleonic wars kept the French blocked off from their colonies, that commercial processes were developed to refine sugar from beet. By 1880, beet had displaced cane as the principal source of sugar in Europe, and beet production spread to the USA, Canada and the USSR. By the mid-1970s, the EEC turned from sugar importer into exporter, a situation that still holds today. (5)

Only one-third of all sugar in the world enters into export statistics, the rest being consumed in the countries where it is produced. But for many developing countries sugar represents an important export. Many islands in the Caribbean, for example, export over 70% of their production and are highly dependent on this single export crop. (6) As with so many other agricultural commodities, prices of sugar on the world market fluctuate widely, making the production of sugar-cane a risky business. Since 1980, however, prices on the world market have collapsed, with little hope for recovery in the future. Production costs of sugar in, for example, the Philippines is some 12 US cents per pound, while world market prices have been below eight cents per pound since 1984. (7)

In 1985, the Prime Minister of Trinidad and Tobago summarized the predicament as follows:

If the current conditions are maintained, we shall be confronting a situation that could lead to the total destruction of the sugar industry of most developing nations, including the Caribbean basin, with all the negative consequences this will have on our economies, political stability and the security of the whole region. (8)

This statement was made at the moment when his government had to sack 8,000 sugar workers and the country's total income from trade had dropped by 60% since 1981, with sugar accounting for most of that decline. The Prime Minister's prediction was not over-dramatized: two years later the country's export income from sugar dropped an additional 38%, with many of the former sugar-workers on the verge of starvation. (9)

The picture is devastating everywhere. In the decade between 1974 and 1984, export incomes of the Group of Latin American and Caribbean Sugar Exporting Countries (GELPACEA) fell from US$6 billion to US$900 million.'ΓΈ What is bad for a country is especially bad for the poor people, in this case the sugar-cane workers. Massive unemployment, poverty and malnutrition are now hitting the workers in the cane-producing regions of the Third World.

One of the main reasons behind this disastrous situation is the EEC's sugar policy. Stimulated by the high prices the European states pay to their sugar-beet farmers - up to five times the world market price - total EEC beet production has increased substantially in the past two decades. In 1977 the European Community became a net exporter of sugar. The increasing surplus was dumped on the world market, making the EEC among the largest sugar exporters in the world. In 1986, the EEC exported more sugar than all developing countries in Africa and Asia together!" This is probably the most important single factor in the chronically depressed world market prices for this commodity. The irony is that the European Community is constantly losing money on its dumping practices as it pays its farmers far more than what it receives on the world market.

Yet the world market is only part of the story, as some 40% of the sugar traded changes hands via special agreements. One such agreement is the Sugar Protocol of the Lom, Convention, in which the EEC agrees to buy some 1.3 million tonnes of cane each year from 17 countries in Africa, the Caribbean and the Pacific at negotiated prices which are higher than the world market. The benefits are unequally distributed, however, with only five countries (Mauritius, Fiji, Guyana, Jamaica and Swaziland) taking up over 80% of the quota. (12) But, however limited, for these countries the Lom, agreement is vital, as many of them largely depend on sugar exports. How stable this preferential treatment is, remains to be seen. Virtually all of the cane sugar sent to the EEC goes to the British sugar giant Tate and Lyle for refining. This company is the only remaining sugar-cane refiner in the UK, and finding it increasingly unprofitable to continue processing the more expensive cane sugar. If the company, which has already reduced its cane refining capacity, decides to stop refining cane altogether, the whole sugar agreement can be thrown into jeopardy and with it the livelihood of hundreds of thousands people in the Third World.
How risky such trade deals can be, is shown by the other major special agreement in sugar trade: the US quota system. To protect its domestic farmers, the United States limited cane sugar imports to specific producers, most notably the Philippines, and countries in the Caribbean and Central America. Under the quota system, these countries developed their sugar industry on the basis that their production could always be sold to the Americans. In the past decade, however, the US dramatically reduced the cane quota as domestic farmers increased production and the US foodprocessors increasingly switched to alternative sweeteners. While the USA imported 4.6 million tons of sugar in 1978, this figure was down to 2.5 in 1985 and to 1.6 in 1986. Some estimate that by the beginning of the 1990s the imports will have shrunk to vanishing point. ' 3 The impact on those cane producers who had been made reliant on the Americans' sweet tastes, is immense. The Caribbean sugar exports to the USA fell from $686 million in 1981 to $246 million in 1984.

But perhaps no one received a harder blow than the sugar-workers in the Philippines, a country which has traditionally sent most of its sugar to the United States. Graph 6.1 shows how, within less than a decade, the country virtually lost its entire export income from this crop. (14) Two-thirds of the country's sugar comes from one island: Negros. This island soon became known as the Ethiopia of Asia. One observer reported:

Out of a total population of two million, 250,000 are out of work. This is not just seasonal unemployment. Most of the mills have been closed down. Next year's cane has not been planted. The small planters face economic ruin, the workers starvation. (15)

Biotechnology and the new sweeteners

Sugar-cane was once known es 'The Golden Crop' due to the huge amounts of money that were made with it, although there was never much gold in sugar for the slaves of the colonial era nor for the plantation workers of today. Now, the crop is locally known as 'the hunger crop' in Brazil's caneproducing regions. (16) Not long from now the hunger crop might not exist at all, at least not as an export commodity, and only the hunger will be left.

Behind this disaster is, to a large extent, technical progress in the field of new biotechnologies, most importantly, new and improved enzyme techniques. While substitutes for sugar have been around for quite a while, only

The decline of sugar - Philippine sugar exports to the USA

in the last decades have scientists managed to improve production processes of the alternative sweeteners to an extent that the very existence of sugar as a commodity is at risk. By far the most important sugar substitute at the moment is High Fructose Corn Syrup (HFCS), known as isoglucose in Europe. This is developed from maize, 1.7 times sweeter than cane sugar, and currently 30% cheaper. (17) The principle of extra; tiny sweeteners from starch has been known for quite some time, but it is the new biotechnological processes that have allowed HFCS to compete directly with sugar. The use of this sweetener increased dramatically, especially in the USA, when the soft-drink giants Coca Cola and Pepsico started shifting to HFCS in 1980. Five years later, 95% of the US non-diet, soft-drinks business used the maize-based sweeteners. In economic terms, the impact of this shift is enormous as the two soft-drink kings are together responsible for a full quarter of sugar consumption in the USA. (18) Combined with similar shifts by the food processing industries, this has been the most important single factor behind the drastic US sugar import quota cuts from the Caribbean and the Philippines described above. After having switched to HFCS, Coca Cola now markets its products in the Third World with the slogan 'Hope for the future'. Hope for whom?

Biotechnology and sugar - Sweetener consumption in the USA 1965-85

Japan's food-processors are also working on HFCS technology and already producing 11 per cent of the world market, but massive use of the sweetener has been limited, as Japan imports virtually all its maize. For the moment, the expansion of the corn sweeteners in the EEC has been restricted due to the strong lobby of the sugar-beet producers and industry.

While some estimate that the current six million tonnes of HFCS produced worldwide (of which the USA uses three quarters)'9 is the maximum the market can take, food-processors are using biotechnology to further expand and speed up the substitution process. Until recently, CS was only available in liquid form, thus limiting its use to processed food and soft drinks. This was until the US company Staly Continental announced that it had developed a technique to crystallize HFCS, and started marketing its new sweetener 'Crystar' in 1987. (20) It is estimated that the crystallized fructose will capture a further half a million tonnes of the market away from sugar by 1990. (21) The OECD already talks of 'further waves of substitution . . . with inroads being made into domestic sugar consumption.' (22) As the OECD further points out, the maize-based sweetener is just one example of the substitution, as similar technologies are being developed to derive sweeteners from a whole range of crops. In that context, it might be better to talk about 'starch derived sweeteners', (23) as starch from potatoes and other crops is also being converted in the same way as starch from corn.

Dramatic enough in their implications, the starch sweeteners are just the tip of the iceberg. In their interminable search for cheaper raw materials, the food-processors are hunting for sweeteners which are hundreds or even thousands of times sweeter than sugar while containing no calories. The first commercial successes in this field came from the chemical laboratories in which scientists constructed, combined and recombined molecules that could compete with sugar. Aspartame, a non caloric chemical sweetener, was one of the first commercial breakthroughs. In search of a share of the cake, several companies are now wielding biotechnology tools to improve aspartame production with enzymes and microbes. Table 6.2 lists the main industrial actors in the hunt for alternatives to sugar.

But people no longer like chemicals in their food, and the real challenges of the future lie in the hunt for the natural non-calorie sweeteners and the genes which produce them. This hunt leads the food-processors back to the Third World where plants produce incredibly sweet compounds. The case of thaumatin has been well documented. (24) Thaumatococcus danielli, locally known as katemfe, is found in humid forest zones in Western and Central Africa and produces the protein thaumatin, some 2,500 times sweeter than sugar. (25) In the 1970s Tate and Lyle set up plantations of katemfe in Ghana, Liberia and Malaysia. (26) The frozen berries are sent to the UK where the company extracts and purifies the thaumatin protein which is then sold as 'Talin' for, according to one estimate, $US 16,500 per kilo. (27) As the extraction process is extremely expensive, several companies are now working to produce the sweetener in the laboratory, using genetic engineering and enzyme technology. Unilever was the first company that managed to isolate the gene coding for thaumatin and to insert it into the bacteria E. coli. Later, researchers at the University of Kent (UK) extracted it and inserted it into tobacco. (28) Tobacco might not seem an obvious choice, but this opens the way to inserting the sweet gene into a whole range of edible crops. These crops might be used as biological 'factories' to produce larger quantities of the desired product in a more convenient crop. They might also be used to produce naturally sweet food crops - avoiding the need to add sugar to the end product.

Since 1982, Beatrice Food (USA) has been funding research at Ingene Inc. (a US biotechnology company), which resulted in the cloning of the gene out of katemfe and into yeast strains. Beatrice holds the patents on the process and it is estimated that the company will earn up to US$25 million in royalties. (29) One drawback of thaumatin is that it has a lingering aftertaste, which limits its use to specific products, but officials from Tate and Lyle claim that protein engineering can change this and widen the possible applications of this sweetener. (30) It appears that it is just a question of time for the food-processors to commercially produce thaumatin from microbes in fermentation tanks, or directly in the edible plants themselves, which would eliminate the need for the current Tate and Lyle plantations in the Third World. The resulting decrease of production costs would put this new sweetener in more direct competition with sugar, thus further aggravating the sugar crisis.

Table 6.2 The attack on sugar: biotechnology research on the new sweeteners

Table 6.2 The attack on sugar: biotechnology research on the new sweeteners - continued

Thaumatin is just one of the new plant sweeteners that threaten the future of sugar; Table 6.3 lists some others. The sweetener hunters ransack savannas, tropical forests and deserts in search of plants and genes that produce even sweeter proteins. The Japanese found an excellent candidate in Stevia rebaudiana, which grows in Paraguay and several countries in South-East Asia. The Stevia proteins are several hundred times sweeter than sugar and are already being marketed in Japan by a subsidiary of Suzuki Int'l (called Stevia Company), together with Morita Chemical Company. Again, a problem that limits its market is that some of the Stevia sweeteners has a bitter after-taste. Companies are using microbes and enzyme technology to change this. Another parallel approach is to select Stevia plants with a higher content of the non-bitter proteins. The Hiroshima Medical School pioneered the tissue-culture work, after which the Suzuki subsidiary man aged to produce tissue-cultured Stevia varieties which can grow in the USA, and produce less of the bitter proteins. Again, it seems a question of time until the companies disregard the plant and manage to produce Stevia proteins commercially with microbes and enzymes.

Table 6.3 The natural super sweets

In roughly the same African regions where the thaumatin producing katemfe grows, you can find the 'Miraculous Berry', which produces a sweet protein called Monellin. The protein is 3,000 times sweeter than sugar, and North American scientists from the University of California are already trying to produce this extremely sweet substance via genetically-engineered cell cultures. The list seems endless. Scientists from Illinois University in Chicago plunged into old Mexican botanical literature and found a plant one thousand time sweeter than sugar (Lippia dulcis). The Mexican Indians enjoyed chewing it even before the Aztecs arrived. Some Chinese medicinal plants were scanned and found to be extremely sweet, as was also the case with Brazilian liquorice.

The search for the sweet genes from the South might bring us back to the beginning of the sugar-circle, which started at the end of the 1 5th century when Columbus introduced sugar-cane into the Caribbean. The history of sugar, from a curious sweet crop in Polynesia, via the plantation horrors of the high tide of slavery, into the current sugar crisis, might end with a few sweet genes, also from the Third World, which finally make it possible to reduce Northern dependence on yet another crop from the South.