Sanding sugar is a coarse-grained refined sugar that is used mostly for decoration. It is sold in colored and uncolored varieties with the colored variety containing food coloring. In both cases, the crystals are shiny and hold up to heat. This sugar can be found in many grocery stores and baking supply stores, but it can be expensive. If you cannot find it or are on a budget, try one of the sanding sugar substitutes below.
Your best bet: Make your own sanding sugar
Sanding sugar is like brown sugar in that it is possible to make your own version with things that you already have in your kitchen. Sanding sugar is mainly decorative and many versions of it consist simply of colored refined white sugar. While it is possible to make it by making a sugar syrup that you then crystallize and grind, there is an easier option.
The simplest way is simply to place about a cup of white granulated sugar into a resealable plastic bag and place a drop of food coloring into it. Knead the bag until the food coloring is distributed evenly throughout the sugar. If you need to deepen the color, add one or two more drops of food coloring. Add 1/2 teaspoon of cornstarch if you plan to store it; the cornstarch prevents clumping. The result can then be used exactly as you would use store-bought colored sanding sugar.
Note that the crystals will not be as large as regular sanding sugar; however, it should still function in the same way. The sugar syrup option may be able to provide larger crystals as you can grind and sift it to get the desired crystal size.
A decent second choice: Turbinado sugar
Turbinado sugar is a minimally refined brown sugar that has the main characteristic of sanding sugar: its large crystal size. This is what enables it to become a crunchy and attractive topping for your favorite desserts. The downside of turbinado sugar is that it only comes in one color, which is golden brown. You could add food coloring to it, but the color will be murky and brownish rather than vibrant as it would be with completely white sugar. While it will be perfect for topping something like apple cinnamon breakfast muffins, it may not be as visually appealing when used to decorate treats for small children.
In a pinch: Pearl sugar
Pearl sugar is another type of decorative sugar that has many of the same characteristics as sanding sugar. Pearl sugar is primarily used in Northern Europe. One popular variety is Belgian in origin and is used as a topping for waffles. It consists of chunks of compressed sugar, which are less likely to melt in the oven.
The ability to stand up to heat is one of the things that you want from a sanding sugar substitute. This allows it to serve as a durable and visually attractive alternative to sanding sugar.
Other alternatives
Rainbow sprinkles are arguably the most popular decorative element used in desserts. Not only are they easy to find, but their colors are also even more brilliant than those from colored sanding sugar. Their downsides are that their gaudy colors are not ideal for all desserts and they are simply not all that sweet since they contain other ingredients aside from sugar. Those other ingredients can include wax, corn starch, and xanthan gum.