Coca-Cola (KO) is adding a new soda made with U.S.-grown cane sugar to its product lineup this fall, marking a major shift in its sweetener strategy for the American market. The announcement came during the company’s Q2 earnings call and follows a public push from President Donald Trump, who last week claimed he had urged the beverage giant to make the change.
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CEO James Quincey said the cane sugar version will “expand our Trademark Coca-Cola product range” and offer consumers more choice. Also, he emphasized that the drink will not replace the existing high-fructose corn syrup formula.
A “Sweet” Shift in Strategy
This marks a major shift for the company, which has used high-fructose corn syrup in its U.S. products since the 1980s, despite using cane sugar in other international markets like Mexico.
It must be noted that corn syrup is widely used in the U.S. due to economic factors. Imported sugar costs more due to tariffs, while corn syrup benefits from government subsidies.
Trump’s announcement on Truth Social (DJT) claimed credit for the move, calling cane sugar “just better.” The push also aligns with Health Secretary Robert F. Kennedy Jr.’s “Make America Healthy Again” campaign, which calls for cleaner ingredients in food and beverages.
Importantly, rival PepsiCo (PEP) is also bringing back cane sugar in its lineup, with the recent launch of Pepsi Prebiotic Cola, a new drink that combines fiber with real cane sugar.
Overall, Coca-Cola’s move to launch a cane sugar soda in the U.S. may boost brand loyalty and sales. However, as cane sugar costs more than corn syrup, the change could raise production costs for the company.
Is KO a Buy or Sell?
Turning to Wall Street, KO stock has a Strong Buy consensus rating based on 15 Buys and one Hold assigned in the last three months. At $79.36, the average Coca-Cola price target implies a 14.20% upside potential.
