Start by preheating your oven to 375 degrees Fahrenheit. Lightly grease a 2-quart baking dish or a 9×9 inch casserole pan with butter or non-stick spray. If you are using frozen corn, let it sit at room temperature for a few minutes or run it under cool water to remove any ice crystals, then drain it well.
In a large saucepan or skillet over medium heat, melt the 4 tablespoons of butter. Once the butter is bubbling, sprinkle in the flour. Whisk constantly for about 1 to 2 minutes until the mixture is smooth and smells slightly nutty, but do not let it brown. This roux serves as the thickening base for your creamy sauce.
Slowly pour in the heavy cream and the milk while whisking continuously to prevent lumps from forming. Continue to cook the mixture over medium heat until it begins to thicken and can coat the back of a spoon. Stir in the sugar, salt, black pepper, and half a cup of the shredded cheddar cheese until the cheese is completely melted and the sauce is glossy.
Fold the corn kernels into the cheese sauce until every kernel is well coated. Taste the mixture and adjust the salt or pepper if needed. Transfer the corn mixture into your prepared baking dish, spreading it out into an even layer with a spatula.
In a small bowl, toss the panko breadcrumbs with the smoked paprika and a tiny pinch of salt. Sprinkle the remaining cup of cheddar cheese over the corn, followed by the seasoned breadcrumb mixture. Place the dish in the oven and bake for 25 to 30 minutes. The edges should be bubbling and the top should be a beautiful golden brown.
Remove the dish from the oven and let it rest for about 5 minutes. This allows the sauce to set slightly so it is not too runny when served. Sprinkle with fresh chopped parsley for a pop of holiday color and serve warm.
