A "sweetness crisis" triggered by the weight loss "miracle drug": Sugar prices halved, even Magnum isn't selling anymore!

GLP-1 weight loss drugs are shifting consumer preferences from “sweet” to “protein,” and this shift is rapidly affecting the valuations of commodities and consumer goods companies: sugar demand is being repriced, protein-related raw materials are strengthening, and high-sugar categories are facing structural pressure. On Wednesday, New York raw sugar futures fell below 14 cents per pound, the lowest level since October 2020, and have halved from their highs at the end of 2023. Traders believe that the slowdown in consumption in wealthy economies like the US has surpassed previous predictions, while the rate of demand growth in developing markets is also below expectations. The market is linking these demand-side changes to GLP-1 injectable weight loss drugs. These medications make people feel fuller by activating receptors and thereby reduce cravings for sweetness. Representative products include Novo Nordisk’s Wegovy and Ozempic, and Eli Lilly’s Mounjaro and Zepbound. In its December 2025 supply and demand outlook report, the US Department of Agriculture cut its sugar usage forecast for 2026 by 23,000 tons to 12.3 million tons, citing a decline in human consumption. This shift in demand is also evident in the stock market. The world’s largest ice cream company Magnum saw its stock plummet after reporting lower-than-expected sales, sparking investors to reassess the long-term impact of GLP-1 on high-sugar categories. Meanwhile, the price of whey and other protein raw materials has risen due to health trends and GLP-1’s influence, forcing food companies to accelerate formula and product structure adjustments. Sugar Prices Fall Below 14 Cents — Demand Slowdown Becomes the Main Factor The immediate trigger for the drop in raw sugar prices is faster-than-expected cooling on the consumption side. According to the Financial Times, Gurdev Gill of broker Marex stated that the speed of the decline in sugar consumption has caught the industry off guard, with the most obvious signals from Mexico and the US, and European demand data is also “challenging” for sugar prices. The consensus among traders is that slowing demand in wealthy economies, combined with lower-than-expected growth in developing markets, has led to a swift fall in sugar prices even when supply and demand are not sharply imbalanced. Stephen Geldart, head of analysis at Czarnikow, said GLP-1 drugs have become quite popular in certain parts of the US, which may be one of the reasons for the downward revision of sugar consumption forecasts. The key point is that sugar demand is highly sensitive to behavioral changes because consumption is very concentrated. He pointed out that about the top 20% of consumers account for around 65% of sales for products like cookies and ice cream. If these “super-users” start using GLP-1 medication, sales could see a “non-linear” decline, amplifying the impact on sugar demand. This also explains why even marginal changes on the demand side can produce outsized reactions in futures prices. Supply-Side Contraction Difficult in the Short Term — Short Positions Near Five-Year Highs Falling prices have not immediately brought about a contraction in supply. Reports indicate that global sugar production has remained relatively stable at around 180 million tons per year in recent years, with Brazil and India maintaining high output and no major producing areas signaling large production cuts. Geldart noted that production and consumption have been generally balanced in recent years, with no obvious stockpiling, but futures prices have still halved in two years—markets previously responded slowly to key consumption issues. Gill added that sugarcane cultivation requires heavy upfront investment and is a long-cycle process, and many farmers are supported by governments and are insensitive to global prices, making supply slow to react to lower prices. With changes in fundamentals expectations, short positions rose significantly at the end of last year and are now near the highest level in five years. Geldart described market sentiment as “extremely bearish.” Ice Cream Sector First to Feel Pressure — Magnum Crash and Unilever Guidance Trigger Repricing Structural concerns have already affected related stocks. Magnum reported its first results since being spun off: Q4 sales fell 3%, well below analysts’ forecast of 0.5% growth. Jefferies analyst David Hayes stated this would “reignite” market concerns about the structural risks GLP-1 poses for the ice cream category. As a result, Magnum’s shares fell over 14% in Amsterdam at one point. For 2025, the company expects revenue of 7.9 billion euros, flat year-over-year, with organic sales growth of 4.2%, and foresees this year’s organic sales growing 3%–5%. Its annual net profit dropped 48% to 307 million euros, mainly affected by the spin-off and restructuring costs, and operating profit fell 21% to 599 million euros. CEO Peter ter Kulve has previously downplayed the risk, claiming the product portfolio includes low-calorie and high-protein options, as well as portion-controlled products like Magnum Bonbons. The spin-off’s parent company Unilever has also been affected. Its shares fell 1.4% in London on Thursday. The company expects baseline sales growth in 2026 to be at the bottom of the 4%–6% range, with at least 2% volume growth. Bernstein analyst Callum Elliott pointed out that management had previously committed to a medium-term target of 5% growth, but this “acceleration” now seems delayed until after 2026. Unilever CEO Fernando Fernandez said after the spin-off the company will become “simpler, sharper, and faster,” focusing resources on faster-growing segments. Full-year underlying sales grew by 3.5%, with Beauty & Wellness and Personal Care up 4.3% and 4.7%, and food business up 2.5%. Protein Raw Materials Buck the Trend — Whey Prices Near Record Highs In contrast to sugar, the protein supply chain is showing strength. John Lancaster of StoneX said whey demand has “risen significantly,” and the price of high-protein whey products used in protein powders and energy bars has “surged” in the past year and a half, with prices in Europe and the US “almost at record highs.” Drivers include GLP-1 and broader health trends. Clinicians warn that without dietary and lifestyle changes, a substantial portion of weight loss from GLP-1 may come from muscle rather than fat. This has led doctors and nutritionists to recommend increased protein intake, further raising demand for whey concentrates and isolates. Data from Worldpanel by Numerator shows that sales of cottage cheese in the UK rose 50% year-on-year in January. Additionally, the first tablet form GLP-1 products were approved in December, which the market sees as potentially lowering the usage barrier and increasing penetration. Agriculture commodities expert Kona Haque believes that as prices fall and adoption widens, the impact “will only grow.” Risk Warning and Disclaimer Markets have risks, and investments should be made with caution. This article does not constitute personal investment advice and does not take into account individual users’ unique investment goals, financial circumstances, or needs. Users should consider whether any opinions, views, or conclusions in this article are appropriate for their specific situation. Investing based on this information is at your own risk.