Using a large sauté pan or a medium Dutch oven, add butter and place over medium heat.

Once butter has melted, add corn, chives, salt, pepper and sugar. Cook, stirring occasionally, for 5-6 minutes.

Transfer 2 cups of the mixture into a food processor. Add half-and-half and process until mostly smooth, but with some bits of corn remaining. Pour mixture back into the pan and stir until well combined.

In a separate bowl, whisk together the milk and flour. Pour this mixture into the pan and stir until well combined.

Cook, stirring often for 4-5 minutes, or until mixture has thickened noticeably and begins to stick to the bottom of the pan.

Remove pan from heat and add shredded cheese; stir until cheese has completely melted.

Serve hot.