UAE Sugar Market - Forecasts from 2022 to 2027

The UAE sugar market is expected to grow at a compound annual growth rate of 5.63% over the forecast period to reach a market size of US$483.440 million in 2027 from US$329.551 million in 2020.

Market Overview:

There are two categories of sugars: naturally occurring sugar and added sugar. Simple sugars, often known as naturally occurring sugars, are present in foods like milk and fruits (lactose and fructose respectively). Sugars or sweeteners that are added to food during processing or preparation are referred to as added sugars. UAE consumers consume more sugar than is healthy in the current environment. UAE is the greatest sugar consumer in the world, with each customer using almost 214 kg of sugar per year.

Growth factor:

Along with the economy, rising income, and growing young and immigrant populations, the snacks and confectionery food segment particularly chocolates, sweet biscuits, and sugar confectionery continues to rise. Over the past ten years, the demand for packaged foods and snacks that are ready to eat has increased in the region due to factors like busy lives, an increase in the number of women working, and increased industrialization. Dual income professional households have increased demand for snacks as a meal replacement, a reward after a long day at work, and a snack in between meals.

Restraints:

Tax on sweetened beverages

It's been claimed that having too much of anything is bad. That includes sugar, which is currently regarded as addiction and one of the main drugs that plague modern man and cause physical waste. Everywhere, including in the UAE, governments implement policy through taxation. The UAE implemented a sugar tax in October 2017 that raised the price of carbonated soft drinks like Coca-Cola and Pepsi by 50%. As a powerful disincentive to reduce escalating sugar consumption, the UAE Cabinet announced an extended list of taxable products, including sugary drinks, in August 2020.

Effect of Inflation

According to data from the National Bureau of Statistics of the United Arab Emirates, annual inflation rose to 2.58 percent in November 2021 from 1.86 percent the month before. Between May 2020 and February of this year, the FAO's Food Price Index jumped by 55.2%. This increase was mostly due to a 159.4% increase in the price of cooking oils, which was followed by major price increases for staples including sugar, dairy, and wheat. The rising costs of ingredients and raw materials have presented significant issues for the food and beverage (F&B) industry. Due to this, it has become challenging for F&B businesses to maintain a competitive advantage and achieve sustainable profitability. As a result, businesses that are unable to handle the increased costs are forced to increase product prices, further burdening customers.

Market Developments:

• October 2021: In Dubai, Tate & Lyle PLC has inaugurated a new Technical Application Centre worth $2 million. To assist clients in advancing their innovation agenda more quickly, the new facility has cutting-edge machinery and an improved prototyping process. To reduce the amount of sugar and calories in food and beverage items, the program will teach both theoretical and practical expertise.
• February 2020: With the signing of a strategic membership agreement with Al Khaleej Sugar and Universa Block Chain, the Dubai Multi Commodities Centre (DMCC), the world's leading free zone and Government of Dubai Authority on commodities trade and enterprise will support the creation of a new sugar trading platform in Dubai. Traders will be able to buy, store, and sell sugar using the platform that is currently being developed using smart contracts on Universa's blockchain technology. Through enforceable warrants that demonstrate the existence of reserves, the DMCC Trade flow platform will serve as the central registration of ownership of the sugar and facilitate safe and open international commerce.

Market Segmentation:

By Form

• Granulated
• Powdered
• Syrup

By Source

• Cane Sugar
• Beet Sugar

By Use

• Food and Beverage
• Pharmaceuticals

By Distribution Channel

• Online
• Offline