The world's production of sugar is about 145 million tonnes with more than one hundred countries producing sugar, of which the largest are India, Brazil and the European Union.

Most of the world's sugar production is consumed in the countries of origin, with only about 25% traded in the world market. The five largest exporters are Brazil, EU, Australia, Cuba and Thailand, which supply about 70% of the free market exports.

Olam's role in the sugar business

The sugar trade is made up of two closely related but differing products - raw and white sugar. Olam's strategic choice has been to participate in the white sugar business; to import and distribute in those countries where Olam has a physical presence.

Olam's Sugar Business was started in 1995 with the import of its first consignment to Nigeria and Ghana. In these countries Olam had already established a widespread procurement network and infrastructure including warehouses for its sourcing operations. This network is used for the distribution of sugar, which enables Olam to provide sugar as close to the point of sale or consumption as possible, providing customers with immediate access.

The knowledge and understanding that was developed in Nigeria and Ghana was built upon and leveraged to expand the sugar business to other African origins like Benin, Tanzania, Uganda and Madagascar.

In South East Asia, Olam's sugar business has been focused on Indonesia, where the import of sugar has been liberalised. This large market, with an annual import of 2.5 million metric tonnes of sugar, provides an opportunity Olam is ideally suited to benefit from due to its physical presence and infrastructure.

Olam's sourcing and trading headquarters in Singapore acts as the centre for all its physical and futures trading activity with ready access to both the London and New York markets. The offices in Brazil, India, Thailand and the Netherlands provide valuable information in relation to the sugar business.

It is Olam's information base and the distribution network in the destination markets, which gives Olam its strong competitive position.

Olam's future strategy

Olam will continue to develop strategic alliances to ensure a cost competitive supply of white sugar for its markets.

Olam will consolidate its position in its existing and emerging markets. It will enter new markets consistent with its import and distribution strengths with particular focus in North Africa and South East Asia.