Now is not a great time to be in the sugar business.
On the health front, Philadelphia is joining the list of cities that want to tax people on sugar-sweetened drinks, and the Food and Drug Administration just approved a new nutrition label that would place more emphasis on calories and added sugars. Meanwhile, sugar has become a volatile commodity: in the past year, prices have tanked over a dozen times before shooting up over 30 percent this month compared to a year ago.
At the center of all this upheaval sits Coca-Cola—the largest beverage company in the world thanks to its eponymous sugar-laden soda. Recently, the company said that, due to a severe sugar shortage in Venezuela, it was suspending production of its signature product in the country as its economy teeters on collapse. Clearly, the politics of sugar have become combustible. Bad politics makes for bad business, which is why Coke is heading down a path that sounds unthinkable for a soda maker: It’s weaning itself off the sweet stuff.
Not that the $84 billion multinational conglomerate didn’t see this moment coming. It’s been planning its own gradual separation from sugar for years—long before the FDA’s new labels validated public health officials’ claims that sugar was a primary culprit for rising obesity rates in the US and abroad. Perhaps no other company in the world is more keenly aware of the rising cost of sugar, both politically and economically, than Coke. And so the company has worked to aggressively expand its brand while working to lower the sugar content of its classic formula.
Source: www.wired.com