Sugar to be imported by most of Indian food and beverages manufacturers in coming months

NEW DELHI: Undeterred by 30-year-high world market prices, beverage companies Coca-Cola & PepsiCo are scrambling to buy sugar overseas to make

sure they are not compelled to slow down bottling lines during the peak demand months of summer.



Firm orders have been placed for delivery of sugar up to June. Cola companies are now gearing up to contract sugar for the remaining season, when soft drink demand is at its peak. Industry analysts say beverage companies are incurring heavy losses – especially in top-selling packs like 200-ml glass bottles or 600-ml and 2-litre PET packs, due to record high sugar prices. Sugar contributes up to 25% share of soft drink production costs. But after having raised prices just a few weeks ago, it may no longer be possible to make consumers share their burden.



Unlike chocolate and biscuit manufacturers, beverage companies also do not have the option of reducing the quantity in their packaging. Right now, indigenously-produced sugar is available in the wholesale markets of Maharashtra for Rs 34 per kg. But beverage companies are learnt to have bought sugar overseas for the June shipment at a significantly higher prices at Rs 40 per kg (at factory gate) because they

 
Read more on ET