Coca-Cola and Pepsi supplies are under threat after access to a key ingredient was thrown into doubt as Sudan is torn apart by fierce fighting.
© Regis Duvignau/REUTERS
Production line of bottles of Coca-Cola – Regis Duvignau/REUTERS
Gum arabic is mostly grown in Sudan, with up to 70 per cent of the world’s supply transported through small towns to the capital Khartoum, the scene of mass violence.
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As chaos escalates in Africa’s third-largest country, twelve exporters, suppliers and distributors said trade of the natural gum, which helps bind together food and drink ingredients, has ground to a halt.
Mohamad Alnoor, who runs Gum Arabic USA, said it is “impossible” to source additional gum arabic from rural parts of Sudan because of the turmoil and road blockages.
“Our suppliers are struggling to secure necessities because of the conflict,” Jinesh Doshi, managing director of Vijay Bros, an importer based in Mumbai, told Reuters. “Both buyers and sellers are clueless on when things will normalise.”
Stockpiles may run out
Wary of Sudan’s persistent insecurity, PepsiCo and Coca-Cola have long stockpiled supplies. But prior conflicts have tended to focus on regions such as Darfur. Now Khartoum has been brought to a standstill in the fighting that began on April 15, paralysing the economy and blocking even basic communications.
Experts fear stockpiles could run out within five to six months.
“For companies like Pepsi and Coke, they can’t exist without having gum arabic in their formulations,” Dani Haddad, marketing and development director of Agrigum, a global top-ten supplier, told Reuters.
Global production of gum arabic is about 120,000 tonnes a year, worth $1.1 billion (£8.8 million), according to estimates cited by Kerry Group.
Most of the substance is found in the “gum belt” that stretches 500 miles from the east to the west of Africa where the arable land meets the desert, including in Ethiopia, Chad, Somalia and Eritrea.
Supplies from these countries are often equally as unstable as that from Sudan and are of lower quality.
Sudanese nomads tap the gum from acacia trees, which is then refined and packaged throughout the country. It accounts for the livelihoods of thousands of people and the more expensive variety can cost about $3,000 a tonne, according to Gum Sudan.
PepsiCo and Coca-Cola did not reply to Reuter’s request for comment on supply chain and commodity issues.