NEW YORK, July 30 (Reuters) - Demand for sugar in the U.S. grew modestly along with the population, while use of high fructose corn syrup fell, a report said on Thursday, suggesting Americans may be trying harder to avoid highly processed foods than to cut back on sugar.

Cane and beet sugar demand in the U.S. rose 0.6% in the first half of the 2025/26 marketing year that started in October, while HFCS deliveries fell 3.5% in the same period, said a report by U.S. rural lender CoBank based on compiled data from the Department of Agriculture (USDA). 

"While concerns about sugar consumption dominate headlines, rising USDA delivery data suggest demand for cane and beet sugar remains firmly intact," the report said, adding that wholesale grocers and food distributors were among the sectors where sugar demand grew more.

"Food manufacturers and consumers continue to favor natural sweeteners over more highly processed alternatives, as sugar and HFCS delivery trend lines make clear," the report said.

The 0.6% growth in sugar demand was in line with the annual population increase in the U.S. which was 0.5% in 2025. 

Three out of four U.S. consumers said they want to limit or completely avoid sugar in a 2025 survey, according to the International Food Information Council.

The CoBank report said the Make America Healthy Again (MAHA) movement showed long-term risks for the sugar industry, as did the prospect of increased use of GLP-1 drugs to reduce obesity.

"Some projections suggest grocery basket sizes could decline by as much as 31% among active users (of GLP). Sweetened foods and beverages are unlikely to be uniquely affected, but they will still face lower demand if consumers generally eat less," the report said.