Südzucker Says Sugar Supply Secure Despite High Demand
Südzucker, Europe's largest sugar refiner, said sugar supplies are secure despite heavy demand as some European consumers stockpile during the coronavirus crisis.
"As a producer of food and animal feed, we are part of the 'critical infrastructure' that receives special support from politics and authorities to ensure that people in many countries continue to be supplied with food," said Südzucker CEO, Niels Poerksen in a statement.
"Currently, the supply of our customers is guaranteed despite high demand."
In many countries, the coronavirus crisis has brought public life to a standstill, it said.
"The Südzucker group has also consistently switched to crisis mode," it said. "The group and the individual group companies have taken measures to ensure that production and administration are functioning properly and that the health of employees is protected."
Global Sugar Consumption
On Monday, (16 March), International sugar trader Czarnikow cut its estimate for global sugar consumption this year by nearly 2 million tonnes, saying the coronavirus pandemic will reduce overall sugar use in countries that imposed lockdowns.
In a note to clients, the global trader headquartered in Britain said it is reducing by 5% the expected sugar consumption in countries such as China, Germany, France, Italy and South Korea, among others, where isolation measures were adopted to help contain the spread of the virus.
Before the coronavirus outbreak, Czarnikow was expecting an overall increase of 1% in world's sugar use. It now believes consumption will stay flat at 172.4 million tonnes.
"This is due to the collapse in out-of-home food and drink consumption, and the difficulties faced in operating normal supply chains," Czarnikow said in the note.
Impact Of Coronavirus Outbreak
The overall outbreak impact on global food consumption is unclear, with some analysts saying widespread movements by people to stock up food could even increase food demand or at least compensate for reduced sales at restaurants and cafeterias. Czarnikow does not share that view.
"We are likely to extend these reductions to other countries if/when they increase their isolation measures," the food trader said, indicating that further reductions on its global consumption projection are possible.
Czarnikow said that despite the reduction in consumption, it still expects a robust global sugar supply deficit in 2019-20 season around 10 million tonnes. That deficit is likely to disappear in the new season, it said.