Squeezed global sugar market looks to holy grails and black swans

The global sugar industry is grappling with slowing growth in consumption coupled with oversupply, which have pushed prices down to unsustainable levels. In such a challenging environment, it’s understandable that the sector is searching for a holy grail to fix its demand-side problems, while also watching carefully for black swan events that could upend the current fundamental picture. This was the mindset in evidence at the Ninth Platts/Kingsman Geneva Sugar Conference held on April 2-3. For Alexandre Luneau, executive vice-president of Tereos, the world’s second-largest corporate sugar produce, the holy grail is a food product that is natural, healthy and tasty – but that includes sugar as an essential part if its formulation. The concern with promoting sugar’s role as a vital ingredient comes in the wake of anti-obesity campaigns in many countries targeting sugar consumption. For some consumers, acceptance on grounds of taste has to be weighed against the health factor. After the introduction of the sugar tax in the UK, both PepsiCo and Coca Cola kept the sugar level unchanged in their classic colas, according to Martin Todd, managing director of market intelligence and analysis provider LMC. Many at the conference said reformulating soft drinks was relatively easy… continue reading

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