Financial Associated Press (Shanghai, editor Zhou Ling) The epidemic has pushed the global economy into a severe recession, and the demand for some commodities has also fallen sharply. Data show that global sugar consumption may drop for the first time in 40 years from a year earlier as consumption of sugar-sweetened beverages such as cola and sugar-sweetened foods declines due to less travel.
The economic downturn triggered by the pandemic has led to a year-on-year decline in global sugar consumption for the first time since 1980, and is expected to fall 1.2% this year to 169.9 million tonnes, according to research firm Czarnikow Group.
In the past few years, sugar consumption has grown by about 1% almost every year, and the shutdown of the global tourism industry is one of the most important factors causing the decline in demand for sugary foods.
Czarnikow writes that the lockdown has led to a decline in going out and consumption of sugary foods at home:
"During the lockdown, there will be less (sugar) consumption at home due to stock shortages, supply chain delays and entertainment closures.
“And sugar consumption is likely to be less outdoors than indoors. When people can’t go to shops, cinemas, sporting events and bars, sugar-sweetened consumption – mainly sugar-sweetened beverages, fast food and food – also decreases. We This can be confirmed by looking at soft drink sales, which have been particularly affected by lockdowns and reduced social gatherings."
"Typically, people are spending more outside their homes than they are at home," said Ben Seed, an analyst at Czarnikow in London.
"If you go to a movie theater, you might be happy to drink a liter or more of soda while watching a movie, and yet we don't think people are going to drink a liter of soda while watching Netflix," Sterling said. En said.
Coca-Cola, whose sales fell 25% in April, warned that the economic downturn would have a severe impact on the second quarter. PepsiCo is another company that expects revenue to decline in the second quarter.
The July ICE-US sugar contract has plunged from a February high of $15.90 to $9.05 in April, down 43% in 52 sessions. The futures contract had surged 35% through mid-June since the April bottom, but was held back by resistance at the 50% Fibonacci retracement at $12.47.
John Stansfield, an analyst at trader group Sopex, said falling demand could lead to a massive sugar glut this year and next.
"To a larger extent, the decline in sugar consumption comes from the sales figures of Coca-Cola and Pepsi, which is terrible," Stansfield said.
"But I'm more worried about global GDP falling. Unemployed people won't go to restaurants and bars. As GDP stagnates, so will sugar consumption."
All in all, with no V-shaped recovery in the global economy this year, the sugar industry faces a bitter winter.
