Natural gas costs push up soy lecithin prices for Solae
soaring costs for natural gas as the company announces price
increases for its line of soy lecithin products.
Solae, a partnership between soy supplier Bunge and DuPont, will hike up prices for its Solec soy lecithin product portfolio by between 5 and 15 per cent.
"An unprecedented rise in energy and transportation costs," propelled the new price range, effective from 1 November, the firm said this week.
"We're testing new processes and technology aimed at lessening our reliance on natural gas," said Jack Self at Solae.
Industries from steel to food continue to be hit by soaring energy costs. In the US natural gas prices reached record highs last week; and firms have faced a sevenfold increase in US gas prices over the past four years.
Prices for crude oil, both a key raw material and energy supplier for the food industry, recently topped a record $70 a barrel.
Further, prices were exacerbated by Hurricane Katrina that last month ripped through the Gulf of Mexico, an important area for the extraction of oil, propelling fears of shortages.
Although since then they have fallen: oil prices fell for a fifth consecutive session on Thursday because of concerns that oil demand was slowing in the US, the world's largest energy consumer.
Benchmark November-dated contracts went down $1.75 to $58.37 a barrel by the close yesterday.
Used extensively in food applications, lecithin, is a popular natural emulsifier, mainly obtained from soybeans, although also sourced from palm oil, rapeseed and other crops.
Increased demand in recent years for non-GM lecithin supplies has pushed up the price for this popular ingredient, used in a wide range of applications from chocolates to salad dressings.
Supplies, relatively smooth in past years when the genetically modified issue had a lower profile, are now falling short of demand.
The European market for Identify Preserved (IP) soybeans (both hard and soft) is estimated at about 40,000 to 60,000 tons for both food and feed.
But the deficit is in the region of 10 per cent, with supplies falling short by about 4,000 tons.