Uruguay Sugar Market - Forecasts from 2022 to 2027

The Uruguay sugar market was valued at US$196.474 million in 2020 and is expected to grow at a CAGR of 3.59% over the forecast period to reach a market size of US$251.478 million in 2027.

Due to people consuming more food and beverages with added sugar these days the usage and demand for sugar have increased which is will play a role in the growth of the market. Also, these days people are preferring brown sugar over white sugar, which will bolster the demand for brown sugar and fuel the market growth further. Although some people are shifting to artificial sweeteners or low-calorie sugar which can restrain the market, Additionally, increasing investment and product innovation by major players coupled with new product launches may further bolster the growth of the market.

Trade in the Market

According to data by OEC, in 2020, Uruguay exported a value worth $1.64M in raw sugar, making it the 98th largest exporter of raw sugar globally. In the same year, raw sugar was the 162nd most exported product in the country. The primary countries that received the exports of raw sugar from Uruguay in 2020 were Jamaica, Israel, and Switzerland.

Further, according to OEC, in 2020, the country imported a value worth $34.3M in raw sugar, making it the 102nd largest importer of global importer of raw sugar. In the same year, raw sugar was the 48th most imported product in the country. The major countries from where Uruguay imports its raw sugar included Brazil, Argentina, and Mexico, along with the US showing the fastest growth.

Online retail to grow substantially

According to the ITA, Uruguay is considered to be one of the most digitized countries in the world and increased use of technology in the market propels innovation. This factor is expected to drive sales in the market through online channels of delivery. Further, e-commerce penetration in the retail industry was estimated to be growing at an annual rate of 25% in 2022. Adding to that, the Government of the country has plans to expand internet connectivity in the rural areas of Uruguay by installing optical fibre in small towns and ensuring countrywide 4G cellular coverage, which is expected to increase the customer demographic for online sales, thus driving growth. Thus, government initiatives in the country are expected to drive substantial growth in this market segment.

The government has established several programs that have helped to foster a growing e-commerce business environment in the country, especially, the Agency for Development of Electronic Government (AGESIC) in 2005. The AGESIC is responsible for developing the government’s e-commerce strategy and promoting inclusion and technology adoption, knowledge management, and communication. The AGESIC develops five-year plans in order to guide the country’s digital transformation strategy. Thus, initiatives like these are expected further boost the online channels of distribution.

Additionally, according to DataReportal, there were 2.91 million internet users in Uruguay in January 2022, making the internet penetration in the country stand at 83.4% of the total population. This was a 0.3% growth from the proportion of Internet users in 2021. Thus, this growing internet population in the country is further expected to boost the market segment in the Uruguay sugar market.

Restraints

People in the country have been experiencing a shift in their eating habits and growing diet consciousness, thus decreasing their sugar intake. This factor is expected to constrain the growth of the market.

For instance, in September 2021, American multinational food, snack, and beverage company PepsiCo announced to invest US$64 million to expand its beverage concentrates plant in Uruguay’s Colonia Free Trade Zone in order to expand on its zero sugar offering. Thus, this shifting focus of F&B players towards non-sugar alternates is expected to restrain the growth of the market in the country.

COVID-19

The outbreak of the COVID-19 pandemic affected the market negatively. The pandemic resulted in the implementation of nationwide lockdowns and social distancing measures in the country, which affected the production, as well as the distribution of the crops to obtain sugar. Further, the lockdowns also mandated the shutdown of offline retail stores in the country, which are still a major source of distribution, thus making the market dip even further.

Market Segmentation:

By Form

• Granulated
• Powdered
• Syrup

By Source

• Cane Sugar
• Beet Sugar

By Use

• Food and Beverage
• Pharmaceuticals

By Distribution Channel

• Online
• Offline