Friday, October 10, 2008

Business Week Covers Rising Maple Syrup Costs

Why Maple Syrup Costs So Much
Mild spring weather in Canada and rising demand for syrup as a natural sweetener are making things sticky for bakers

September 27, 2008, 12:01AM EST by Pallavi Gogoi

It's hard to swallow: Since May, Mark Menning has watched the price of maple syrup soar to $6 a pound—up from $2 a pound a year ago. That's a problem for Menning, since the maple syrup is a key ingredient in the cookies his San Francisco-based Lotus Bakery supplies to some Whole Foods Market (WFMI) outlets and Bay Area specialty grocery stores.

Add in rising costs for everything from oil to flour, and you've got a recipe for disaster. Says Menning: "These price increases can make or break you."

What's going on? Is there a shadowy syrup cartel manipulating prices? Has someone figured out how to turn maple sap into fuel? Not quite. Unfavorable weather in Quebec—the source of 80% of the world's maple syrup—have depressed output to a 10-year low. At the same time, demand for maple syrup, which is slightly lower in calories than cane sugar and corn syrup, has been growing in recent years, as more Americans seek alternatives to processed and artificial sweeteners.

A Scarcity of Sap
Blame it on global warming, perhaps. But for the past three years, Quebec has seen cold winters turn very quickly into warm springs, which played havoc with sap collection. (Under ideal conditions, temperatures rise during the day and then dip back below freezing at night. This pattern encourages sugar maples to release their sap). That has cut sap production season in half, to two to three weeks. Quebec's output slipped to 58.7 million tons this year, down from 61.7 million in 2007 and 86.4 million tons in 2004.

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