(Includes details of study, context on consumption)
NEW YORK, March 16 (Reuters) - International sugar trader Czarnikow on Monday 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.
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.
Reporting by Marcelo Teixeira Editing by Chizu Nomiyama and Marguerita Choy
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