Sugar - Procurement Best Practices & Sourcing Strategies

Procurement Market Intelligence Report

Sugar – Procurement Best Practices & Sourcing Strategies

Sugar Market – Executive Summary, Sugar Market Analysis, Market Monitoring Dashboard & Insights, Sugar Industry Analysis, Sugar Suppliers, Purchasing Process: RFP/RFI Questionnaire, Sustainability Initiatives and Best Practices

1. Executive Summary
1.1. Executive Summary
1.2. COVID-19 Impact
1.3. Talking Points to Business
2. Sugar Market Analysis
2.1. Global Sugar Market Analysis
2.2. Regional Market Outlook (Brazil, India, US, Australia and EU)
3. Market Monitoring Dashboard & Insights
3.1. Cost Structure Analysis
3.2. Pricing Analysis
4. Sugar Industry Analysis
4.1. Industry Overview (Global)
4.1.1. Porter’s Five Forces Analysis
4.1.2. Innovations in Sugar Industry
5. Sugar Suppliers
5.1. Sugar Supplier Profiles
5.2. Supplier SWOT Analysis
6. Purchasing Process: RFP/RFI Questionnaire
6.1. Sample RFP Questions
7. Sustainability Initiatives and Best Practices
7.1. Sustainability Initiatives and Best Practices

Important Questions Related to the Sugar Market Report

  1. What are the prominent segmentation factors of the international sugar sector?

The prominent segmentation factors for the sugar market include distribution channels, end-use industries, sugar types, and geography.


  1. Which are the prevalent countries in the global sugar market?

The global sugar market has been divided into several dominant regions, including Brazil, India, the US, the EU, China, Thailand, and others. However, at present, Brazil is operating as the largest country in the sugar market.


  1. What was the impact of the COVID-19 pandemic on the international sugar sector?

The sudden impact of the COVID-19 pandemic conditions caused manufacturers and suppliers to employ online e-commerce platforms to sell sugar, instead of using traditional physical ways of distribution.


Sugar Market Global Size:

According to ELINT Market Research’s latest sugar procurement intelligence and insights report the global sugar sector witnessed a noteworthy supply of 285 MMT and a consumption of 246 MMT in 2022/2023. This proportion of distribution and consumption showcases that this market is achieving new peaks across a wide range of industries. However, the report declared ending stocks of 39 MMT for the market, which implies that in case of any emergencies like economic tensions, weather impacts, and price volatilities, the sugar manufacturers and suppliers employ this buffer to cater to individuals’ and organizations’ needs.

Additionally, the International Sugar Organization (ISO) launched its recent assessments, which state a deficit estimate to be -2.25 MMT for the years 2021/22, from the earlier calculation of -1.67 MMT. Moreover, the organization reduced its abundant sugar valuation to 4.15 MMT from 6.19 MMT in 2022/23. Hence, these facts and figures represent restrained sugar supply conditions which contribute to elevated prices.

Market Definition:

Sugar is majorly produced and extracted from sugar cane and sugar beet via cultivation methods. Further, sugar is employed by some of the significant industries like food and beverage, medicine, chemicals, and cosmetics. Also, worldwide sugar manufacturers are focusing on building alternatives that taste exactly like sugar but comprise fewer calories; this way they are assisting a large count of consumers who are concerned about their health and diseases like diabetes.

Sugar Market Drivers:

  1. Higher Supply Expected from Brazil –

One of the substantial growth drivers for global sugar procurement market intelligence is the abundance of supply from Brazil, which is operating as the top manufacturer and supplier of sugar.


  1. Increasing Need for Sugar-Based Products –

Another crucial driver for the sugar sector is rapidly increasing consumer preference for sugar-based items like candies, drinks, bakery goods, convenience food, etc.

Sugar Market Challenges:

  1. Adverse Weather and Energy Crisis in Europe –

A few of the key reasons such as higher input costs, adverse weather conditions, and energy crisis particularly in Europe are forming challenges among sugar producers. Hence, due to this difficulty, this country also faces restrictions on sugar beet production.


  1. Health-Related Concerns –

Various health-conscious people avoid consuming excessive sugar as they are aware of its potential negative effects, which pose a challenge for global sugar market development.


  1. India’s Trade Policy –

Worldwide sugar manufacturers have encountered a challenge due to India’s trade policy, which states that this country has decided to limit sugar exports at 11 MMT for the 2021-22 period. Also, in the years 2022-23, the nation planned to export sugar in two allotments in which the first allotment is set at 6 MMT. Thus, this policy affected global sugar expenses and trade dynamics.

Sugar Market Opportunities:

  1. Alternatives for Sugar-

The sugar manufacturing companies encountered a great opportunity as they started investing in alternative sweeteners of sugar to assist health-concerned individuals. These alternatives possess fewer calories and similar tastes to sugar.


  1. Various Emerging Markets –

Prominent sugar manufacturing countries like India, Thailand, and China declared lower-than-expected outcomes, which exhibits the strength of the sugar supply market. Moreover, as sugar harvesting movements are adversely impacted by stormy weather conditions, the production levels hampering in Brazil.


  1. Arising Benchmark Price Indices –

The ICE #11 and LIFFE 05 are widely identified and emerging benchmarks that monitor the price movements of raw sugar futures orders that are traded on commodities marketplaces. Thus, stakeholders can thoroughly understand existing and upcoming sugar market movements.

Sugar Procurement Market Segmentation:

  1. Different Ways of Sugar Distribution –

The key segmenting factor for the global sugar market is the type of distribution channels like convenience stores, marts, local shops, superstores, and online stores.


  1. End User Sectors –

Sugar is mainly and largely used by the food and beverage industry to make diverse food items like dairy products, chocolates, drinks, sweets, and more. Further, some non-food sectors also employ sugar as the main component to build their products, these sectors include pharmaceuticals, chemicals, and beauty items.

Sugar Market Stocks for 2022-23

The international sugar industry illustrates varied stock dynamics for distinct countries for the years 2022-23 when compared to the past five years’ average. In this context, global sugar stocks evaluated a 10.1% reduction, which means lower reserves. Further, some more nations have witnessed substantial declines in sugar stocks including Brazil at 45.3%, Thailand at 51%, the United States at 26.7%, Europe at 12.6%, and China at 49.6%. Thus, these countries have rapidly seen deductions in their sugar stocks maybe due to negative weather, geopolitical matters, or price shifts. On the other hand, the only territory that emerged as dominant in this industry is India, which accounted for a subtle increase of 7.9% in its sugar reserves.

Price Outlook for Sugar Market

Elint’s sugar procurement intelligence market research report depicts the diverse price shifts in various countries. These nations experienced higher sugar expenses in 2023 including Brazil at $571/MT, India at $527/MT, the US at $880/MT, and the EU at €827/MT. Hence, sugar consumption and production levels have risen in these territories.

Key Emerging Countries in the Sugar Market

Some of the major countries that are producing vast amounts of sugar and meeting worldwide requirements include Brazil at 18%, India at 17%, Thailand at 8%, the EU at 10.7%, China at 6%, and the US at 5%. Further, when it comes to massive consumption of sugar, the significant nations that emerged comprise India at 16%, China at 9%, the EU at 11%, the US at 6%, and Brazil at 6%.

Moreover, prominent exporters of the global sugar industry include Brazil at 36%, Thailand at 20%, Australia at 6.6%, the EU at 4.2%, and India at 6%. On the other hand, Indonesia occurred as a giant importer of sugar with a 10% import rate. Also, some other territories that are contributing to sugar-importing activities include China at 8%, the US at 5%, Algeria at 5%, and Bangladesh at 5%.

Weather Impact on Sugar Market (2022/23)

Suitable weather conditions are very crucial for the sugar market and in the 2022-23 period, some of the noteworthy countries experienced adverse weather impacts. In this sense, Brazil’s sugarcane yields were impacted by the event of La Niña weather patterns, which induced average-level rainfall. Furthermore, India underwent irregular rainfall situations, which caused disruption in sugar agricultural activities. Contrarily, in Thailand, the climate situations were favorable, as rainfall helped in higher sugar production

Engagement Models in the Sugar Market

Sugar procurement market intelligence companies employ major contract models that assist in handling supply chain patterns. These two key contracts are stays for either short term i.e., 3 months, or long term like 6–7 months. Hence, stakeholders can choose any one of them as per their needs and choices. Additionally, the fourth quarter of 2023 is considered convenient for price-locking agreements.

Cost Drivers in the Sugar Market

Some of the substantial factors are assisting in driving costs for the global sugar market; the first one is rising cane production prices that cost more to manufacturers and affect their profitability. Moreover, various government trade regulations also increase expenses for suppliers or producers since they need to obtain permits for export or import activities. Additionally, the last factor is the domestic sugar industry policy that is executed by key producing countries, which compels manufacturers to adhere to stipends, support projects, and allotment shares.

Leading Suppliers in the Sugar Market

Notable brands that are contributing to the global sugar market supply chain, and also fulfilling the worldwide demands for sugar include Cosan S.A–Raizen, Sao Martinho S.A., EID Parry Limited​, and Shree Renuka Sugars Ltd.

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