Clashes in Sudan affect coke producers

Conflicts in Sudan have jeopardized the supply of gum arabic, which is a component of many products produced globally.

Clashes that broke out between the army and the Rapid Support Forces (HDK) in Sudan on April 15th threw the country and the region into chaos, and global businesses were also affected by this situation.

Gum arabic produced in Sudan became a prominent product in this regard.

While gum arabic, which is an ingredient in a wide range of products from soft drinks to candy to cosmetics, stands out as one of the most demanded products in the country, conflicts in the country have jeopardized the gum supply. Arabica, which is a component of many products produced globally.

The supply of gum arabic, used in the production of Coca Cola and Pepsi, one of the world’s leading beverage companies, is at risk.

GUM GUM A KEY INGREDIENT IN MANY PRODUCTS

Commodity and futures market expert Zafer Ergezen, in his assessment on the matter, stated that the entire world is expected to be affected by the violent conflicts in Sudan.

Ergezen said: “Gum arabic, which many of us don’t know about, is important to Sudan. 70% of the supply of gum arabic produced in the world comes from Sudan. The problems experienced in the supply chain due to the conflicts here paralyzed the supply of gum arabic, ”he said.

Expressing that gum arabic is one of the most important raw materials in many sectors, from carbonated beverages to cosmetics, Ergezen said, “Many beverages we drink today or cosmetics we use actually contain gum arabic. The fact that its alternative is also very limited increases the importance of this product, and therefore the importance of Sudan, for this sector. Currently, many organizations are turning to alternatives. Of course, when the supply of the product was interrupted, a rapid increase in prices was observed. Just like it happened with many products during the pandemic period, ”he said.

Ergezen stated that product shipments have been halted due to ongoing conflicts.

Expressing that many countries are making efforts to end the conflicts in the country, which has such a critical supply of raw materials, Ergezen said, “It is claimed that the current stocks of gum arabic can satisfy the supply for about 6 months. In this case, if the conflicts in Sudan cannot end within this time frame, many companies in the world may be in a difficult situation and reach the point of stopping their production. In order to use stocks in a controlled manner, carbonated beverage producers can be expected to reduce their production or turn to alternative suppliers. The prices, which have risen in a short time, show this desire”.

Ergezen emphasized that the greatest demand for gum arabic is from companies like Pepsi and Coca Cola.

“It is stated that the world production of gum arabic is 120 thousand tons. About 84 thousand tons of this is produced by Sudan. Its total economic value is estimated at 770 million dollars. Ergezen, who made his assessment, said: “Although the share of gum arabic in world trade appears low, it is in the critical raw material group due to the areas where it is used and the lack of alternatives.” (AA)