Cut soda sugar sector, but coming up in costs with other inputs

Sao Paulo-the soft drink industry is able to reduce production costs with the release of the mixture of sugar and sweeteners. But the reduction of the supply of juice and citrus oils could upset the plans of liquor chain.
"The manufacturers come seeking to reduce the sugar content with substitution by sweeteners (sweeteners) a few years ago, because this is related to the theme of healthiness. But, in addition, they have reduced the cost to sweeten soft drinks, "says Flavio Moribe, commercial Director of Tovani Benzaquen, which provides the beverage ingredient.
According to the Executive, the replacement for sweeteners allows 30% to reduce industries 60% costs. The movement gained more power after the release of the mixture of sugar and sweeteners in beverages ready from 8,592 Decree December 2015.
In addition to being cheaper sweeteners, sugar should be more expensive. The projections for the global deficit indicate commodity product.
"Grown considerably the demand of our customers for sweeteners and, today, 80% of the soft drink manufacturers switched to the hybrid model and who not migrated, you must do it by the end of 2017," said the Manager of accounts of supplier of flavours and juices Loop, Gabriel Piacentini.
Even with the migration to compositions with less sugar content, Piacentini said that the industry may face problems with the costs of the oils and Citrus juices, other important inputs.
"In recent years, with costs that have increased and the juice industry often ends up favoring the export", said the Executive.
The senior aromista International Flavors & Frangances (IFF), Mariana Sales, also highlighted the lesser supply of citrus oils in the global market. "More and more consumers demand products with freshness and citrus are important in it. But we know that the crops have suffered from diseases, which results in elevation of the overall cost with the oils ", commented.
According to a partner at Markestrat consulting, José Carlos de Lima Júnior, the citrus has suffered from pests, mainly in the United States and Brazil, major producers of Orange. With the supply reduction, the cost has grown.
"The Brazilian producers suffered from the fall in the price of juice in recent years, which led them to abandon the citrus, reducing the supply," he said.
Added value
Even with the soft drink category increasingly shrinking in volume and at constant pressure on the cost of inputs, the expectation of the supply chain is that manufacturers can at least expand the margins with higher value-added items.
"We have demand for manufacturers to develop soft drinks with up to 60% of fruit juice, when today the percentage is 5%. But this is for a premium niche, "said Piacentini, the Loop. The vendor is enforcing the disclosure of new flavors and textures to soft drinks.
According to Piacentini, the category will remain relevant to the market, but the highlight should have two niches: higher value-added products and the other extreme, with low-value labels.
For the Director of audit consultancy Kantar Wordpanel, Thiago Torelli, the lower-priced soft drinks have grown in recent years, driven mainly by manufacturers '' investment in marketing, as in the case of Itubaina. Already the giant Coca-Cola, the first to use sugar and sweeteners in Brazil on drink with Stevia, lost 2.5 points of penetration in Brazilian homes, cited Torelli.
"The Brazilian consumer is more rational and evaluating very cost-effective, which favors lower-priced products," he concluded.