I went into a googling frenzy a couple months ago when the show came out and the coolest theory I found was that whatever it is, it is stored in a sugar bowl because a sugar bowl has no other functionality in Snicket’s world. While tea is regularly drunk during the series, only villains take their tea with sugar. Volunteers make it a point of pride that they take theirs black, making a sugar bowl a perfect in plain sight hiding place. Which I suppose means that it was put in a sugar bowl in order to hide it from Volunteers, not fire starters, which is consistent with the fact that it was originally stolen from Esme Squalor.
