Sugar Prices Skid

Sugar wasn't looking so sweet Monday as prices dipped on news that U.S. regulators disagreed with a study from Europe and said the artificial sweetener Aspartame is safe for human consumption.

That of course sets up the potential for sugar to face more rugged competition from man-made alternatives and perhaps see depressed demand. Ongoing worries of growing surpluses also weighed on the market.

Prices for sugar contracts were down almost 3% at 9.21 cents per pound on the New York Board of Trade. As recently as March 2006 prices traded as high as 18 cents.

The Food and Drug Administration announced Friday that it rejects a study from the European Ramazzini Foundation, first published in 2005, which said the compound Aspartame is a carcinogen. Following the original publication, the FDA requested that data from the study be made available for further review.

But by last year, the FDA was complaining that the information provided by ERF wasn't sufficient. Still, the FDA went ahead with its own review.

"Based on the available data, however, we have identified significant shortcomings in the design, conduct, reporting and interpretation of this study," the FDA states. "FDA finds no reason to alter its previous conclusion that aspartame is safe."

Aspartame is sold under the NutraSweet brand name and has been widely used in a variety of products for more than 20 years. However, questions have been repeatedly raised about whether it could have ill effects on the health of humans.

Separately, earlier this month an executive of the International Sugar Organization forecast large sugar surpluses, a position that was reiterated in an interview in India's Business Standard on Monday.