By Whitney McFerron - Oct 2, 2013 6:52 AM ET
Global trade in sugar is helping to fuel land grabs in developing countries, and food and beverage companies should do more to protect smallholder farmers from losing their livelihoods, Oxfam International said.
Out of the 31 million hectares (77 million acres) of land used to produce sugar globally, at least 4 million hectares have changed hands in large-scale deals since 2000, Oxfam said in a report today.
Rising prices and consumer demand have encouraged more large-scale production operations at the expense of smaller farms in countries including Brazil and Cambodia, it said.
“In some cases, these acquisitions have been linked to human rights violations, loss of livelihoods and hunger for small-scale food producers and their families,” Oxfam said.
“Small-scale producers are sidelined as the market offers companies huge rewards for exploiting land, but without safeguarding people’s rights.”
While sugar dropped 5.4 percent this year on ICE Futures U.S. in New York, prices have rallied 60 percent since the end of 2007.
Global trade in sugar is worth $47 billion, Oxfam said.
Fifty-one percent of sugar produced worldwide is used in processed food including soft drinks, confectionery, baked goods and ice cream, Oxfam said. While many food and beverage makers don’t own land directly, companies including Coco-Cola Co., PepsiCo Inc. (PEP) and Associated British Foods Plc (ABF) should “take steps to ensure that land rights violations and conflicts are not part of their supply chains,” according to the report.
AB Foods, owner of Africa’s biggest sugar producer Illovo Sugar Ltd. (ILV), “works to the highest ethical standards to benefit the communities in which it operates,” according to a company statement in response to the Oxfam report. Coca-Cola said in a statement that it is “working to promote respect for human and workplace rights” and it’s asking suppliers to safeguard local communities’ access to land and natural resources.
PepsiCo didn’t immediately respond to an e-mail sent to its European press office for comment.
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