Cocoa-free sugar confectionery market in Sri Lanka

Earlier Report Observations

From 2018 to 2020, the market volume for cocoa-free sugar confectionery in Sri Lanka declined from 2 589 t to 2 440 t, primarily driven by a sharp contraction in imports. This followed the proposal and subsequent implementation of a sugar tax on confectionery products, which increased costs and reduced the competitiveness of low-cost imports, causing imports to fall by over 50% in 2019. During the same period, the launch of a new ultra-modern factory by Uswatte Confectionery Works bolstered local production capacity, contributing to an 18% rise in domestic output by 2020, partially offsetting the import drop.

After a slight dip in 2021, market volume rebounded to 2 592 t in 2022, supported by reported growth in consumer demand for sugar and confectionery products, alongside a significant rise in imports. Government plans to impose price controls on sugar aimed to stabilize the market. By 2023, the market expanded further to 3 016 t as local production surged by 29% to 2 742 t. This growth occurred amidst the introduction of new food labelling and advertising rules, whose implementation was postponed to 2025, and ongoing discussions to amend tax legislation following controversies related to the sugar tax.

In 2024, the market continued to be shaped by a clear shift in consumer preferences towards healthier, low-sugar options, leading major players like Maliban and Elephant House to launch reduced-sugar and sugar-free product ranges. Heavy reliance on sugar imports persisted due to insufficient local production, despite efforts to boost sugarcane cultivation. New labelling regulations, set to take effect in 2025, are expected to enhance consumer transparency but have raised industry concerns about compliance costs and practical feasibility.

Production cocoa-free sugar confectionery in Sri Lanka

In kind, 2017-2020, t

Top producers of cocoa-free sugar confectionery, 2017-2020

World map of production of cocoa-free sugar confectionery, 2017-2020

Sri Lanka's production of cocoa-free sugar confectionery has grown for the third year in a row. In 2020, the country produced 2 326 tonnes, marking a significant 18.4% increase from 2019. Over the 2017-2020 period, production rose by 29.4%, with an average annual growth rate of 9.0%.

Annual dynamics of production in Sri Lanka in kind, 2017-2020, t

Exports cocoa-free sugar confectionery from Sri Lanka

Exports in kind, t

The market exhibited volatility during the observed period. In 2019, exports hit their lowest point at 25 tonnes, while 2018 saw the peak at 283 tonnes, representing an 11.1-fold difference. In 2020, Sri Lanka's exports of cocoa-free sugar confectionery reached 55 tonnes, a substantial 116.7% improvement over the previous year. The largest decline occurred in 2019, falling by 91.0%, while the biggest increase was in 2018, surging by 667.3%.

Annual dynamics of product's exports from Sri Lanka in kind, 2017-2020, t

From 2017 to 2020, Oman, Maldives, and Pakistan were the main buyers of Sri Lanka's cocoa-free sugar confectionery exports by volume. Oman accounted for 43.8% of exports, Maldives for 14.2%, and Pakistan for 9.3%, together making up 67.2% of total export volume.

Structure of product's exports in kind by countries, 2017-2020

World map of product's exports from Sri Lanka in kind, 2017-2020

Exports in value, K $ US

The data shows irregular fluctuations, pointing to a volatile market environment. In 2019, export value was at its minimum of 112 thousand US dollars, while 2018 saw the maximum of 481 thousand US dollars, a 4.3-fold variation. In 2020, Sri Lanka's cocoa-free sugar confectionery exports amounted to 230 thousand US dollars, a 105.0% year-on-year increase. The largest decline was in 2019, dropping by 76.6%, and the biggest increase was in 2018, rising by 197.1%.

Annual dynamics of product's exports from Sri Lanka in value, 2017-2020, K $ US

Between 2017 and 2020, Sri Lanka's cocoa-free sugar confectionery exports by value had a diverse buyer portfolio. Maldives contributed 21.0% of export value, Pakistan 14.3%, and Oman 10.7%, together accounting for 46.0% of total exports. Many other countries held smaller but notable shares.

Structure of product's exports in value by countries, 2017-2020

World map of product's exports from Sri Lanka in value, 2017-2020

Imports cocoa-free sugar confectionery to Sri Lanka

Imports in kind, t

Sri Lanka's imports of cocoa-free sugar confectionery have fallen for the second consecutive year. In 2020, imports dropped to 169 tonnes, a 66.8% decrease from the previous year. Over the 2017-2020 period, imports declined by 78.7%, with an annualized rate of 40.2%. The highest import volume was in 2018 at 1 027 tonnes, which also saw the largest increase of 29.5%.

Annual dynamics of product's imports to Sri Lanka in kind, 2017-2020, t

From 2017 to 2020, India, China, and the United Arab Emirates were the primary suppliers of cocoa-free sugar confectionery to Sri Lanka by volume. India made up 36.3% of imports, China 17.0%, and the UAE 10.3%, together representing 63.5% of total import volume.

Structure of product's imports in kind by countries, 2017-2020

World map of product's imports to Sri Lanka in kind, 2017-2020

Imports in value, K $ US

Sri Lanka's imports of cocoa-free sugar confectionery have declined for the second year in a row. In 2020, import value fell to 393 thousand US dollars, down 66.8% from 2019. Over the 2017-2020 period, imports decreased by 74.1%, with an average annual decline of 36.3%. The peak was in 2018 at 2 259 thousand US dollars, which also recorded the largest increase of 48.7%.

Annual dynamics of product's imports to Sri Lanka in value, 2017-2020, K $ US

Between 2017 and 2020, India, China, and Malaysia were the key sources for Sri Lanka's cocoa-free sugar confectionery imports by value. India accounted for 36.5% of import value, China for 9.9%, and Malaysia for 6.9%, together comprising 53.3% of total imports.

Structure of product's imports in value by countries, 2017-2020

World map of product's imports to Sri Lanka in value, 2017-2020