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Strategic Case Analysis: ADI Sugar - Essay Example
Pages 16 (4016 words)
Australian Diversified Industries Limited (ADI) is a multi-faceted company consisting of three primary divisions; ADI Sugar, ADI Timber Products, and ADI Fertiliser and Chemicals. These segments operate largely autonomously, and management is currently considering the divestment of the sugar division due to poor performance…
ADIS competes in the highly speculative and volatile world sugar market. It produces its finished product through two methods of processing; milling and refining. Each of these processes yields a different type of sugar product that is produced, priced, marketed, and distributed in different ways; both nationally and internationally. Regardless of the various product distinctions, however, this external industry analysis section will focus on the pricing and consumption of the all-inclusive product we will call "sugar," with all of its derivative products, i.e., for these purposes, there is no significant distinction between table sugar, confectioner's sugar, or molasses.
The world's sugar consumption has "grown steadily by approximately two percent each year" (13) and, while stable industry growth is always perceived as a good thing, there are various economic, demographic, political, and other developments that make the sugar industry somewhat anomalous and less predictable than other industries. ...
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