Strategic Review of Corn Starch Industry & Markets - Starch Derivatives, Sweeteners & Co-Products Aug. 2010
NEW YORK, Feb. 2, 2011 /PRNewswire/ -- Reportlinker.com announces that a new market research report is available in its catalogue:
1) This new starch processing report has several improvements, new information, insights since we are now in a global economy. Several developed economies globally remain in recession and as the recession ends there will be great opportunities for starch processing industry especially to fulfill the demands of new developing economies in Asia, South America and Africa. Brazil, Russia, India and China and other developing economies are current growth engines. This executive summary is an introduction to this report and not compilation of sections of each chapter as presented in other similar reports, we do not want to duplicate the contents of chapters. This report remains a comprehensive leading document that has industry data along with description of how industry or plants are managed. It provides in-depth review of several areas that cannot be found in other publications. There are many details of production, markets, products, costs, capacity, players in the US and data sets of sweeteners, starch derivatives, co-products including the impact of trade regulations. None of this is available in a reports format as we have attempted to compile in this report. In the last section of report is a complete list of global players of this industry.
) During mid-2010, finally National Starch Food division found a acquirer in Corn Product International. Our understanding is that National will be managed as a independent business unit. Recent demand on starch from ethanol has greatly enhanced the margins including HFCS. In the US HFCS demands declined significantly in the past 3 yrs accounting for a drop of ~ 11 % due to concerns of obesity and glycemic trends among others. To compete, even the larger food processors are introducing new extensions to their lines claiming no fructose? However in our view with sugar shortage and historical high sugar prices HFCS position will not erode further significantly as in the past 3 – 4 yrs.
3) The total utilization of dried starch in the world in 2008 was ~66.5 million tons (USDA, EU Commission). Our estimate for 2010 is 68 million tons with annualized global growth of 2-3%. We previously estimated this would reach 70 million tons by 2010; we missed this mark by 2 million tons manly due to slowdown in US and EU. China had the biggest growth with 17.5 million tons production and has surpassed US with 13 million tons for dry starch and fermentation; not including sweeteners and alcohol. The US , EU and Japan has lower growth of ~2%/year, EU at ~2%, and Japan at 1-2%; in China and India the growth is strong as expected to be 4-5 % the rest of the world grows at 3-4%. Both the US and EU will have to compete for this growth in China, India, other regions. There are only few starch processors left in the US and even ADM and Cargill are positioning themselves in EU and Asia. National Starch remains a dominant specialty player in the US. Cassava in SE and S Asia and Central America will become more dominant starch commodity as more production technology is deployed. Cassava is 7.5 % of world starch. This figure will have been rising faster as China, India, South America and SE Asia continue to improve their production economics. Above values do not include corn utilization for dry corn ethanol which more than double of corn used for corn wet milled products derivatives.
4) According to several reports, US corn production for 2009 was 13.2 billion bushel (Bu) a record vs. previous record of 13 billion bushels of 2007, all of this increase comes due to increase demands for corn ethanol by the dry corn milling plants. Farmers planted 90 million acres of corn compared to ~ 79 million acres during 2009. According to RFA (Renewable Fuel Association) and other reports, there are 178 corn ethanol plants in operations today and 24 plants under construction and 10 expansions of current operations; these include 11 wet mill operations.
5) This August,2010 revison of our report is an analysis and presentation of data along with insights into several aspects of this industry based on experience of my associates and me, which included several assignments in the operations, research and development; marketing and technology transfer in the U.S. and Europe. This is a comprehensive report with lot of data and insights in to how this industry operates and how one can position in the changing global markets. This report has also served as an excellent tool for industries that do business with corn processing industry, a training tool for operations, marketing, purchasing and R & D groups Sakharam K.
I. Executive Summary 5
II. Brief Overview of Corn and Wet Milling Process 7
A. CORN 7
B. OVERVIEW OF CORN WET MILLING PROCESS 9
III. Markets 12
A. FOOD & BEVERAGE MARKET PROFILE 12
III. Markets 13
A. FOOD & BEVERAGE MARKET PROFILE 13
B. STARCH PRODUCTS SITUATION AND FORECAST 15
C. SUPPLY AND DEMAND SITUATION 21
D. POTENTIAL CHANGES AND MARKET DRIVERS 23
E. NATIVE AND MODIFIED STARCH PRODUCTS OVERVIEW 24
F. OVERVIEW OF MODIFIED STARCHES 27
G. MODIFIED STARCH MARKETS 36
IV. Sweeteners and Maltodextrins 46
A. SWEETENERS 46
B. CORN SYRUPS – HFCS (HIGH FRUCTOSE CORN SYRUP) AND OTHER SYRUPS 46
C. MALTODEXTRINS 53
V. Ethanol and Co - Products Brief Review 58
A. ETHANOL 58
B. GROWTH OF FUEL ETHANOL AND ITS EFFECT ON THE INDUSTRY 62
C. CO-PRODUCTS: 63
D. ISSUES AND CHALLENGES 66
VI. COMPANIES IN NORTH AMERICA 68
A. COMPANIES AND PRODUCTS 68
B. CONSOLIDATION IN THE STARCH INDUSTRY 69
C. PRODUCTS MANUFACTURED BY CORN REFINERS 71
D. INDUSTRY CHOICES TO SUPPLY STARCH FOR POTENTIAL LARGE NEW APPLICATION 71
F. ANALYSIS OF STRENGTHS AND WEAKNESSES OF PLAYERS (SWOT) 76
G. PLAYERS - OTHER DIFFERENCES 80
H. INVESTMENT RISK AND DECISIONS 81
I. R & D INVESTMENTS 83
VII. COSTS, INVESTMENTS AND MARGINS 85
A. PRODUCT PROFITABILITY 85
B. COST OF PRODUCTION 86
C. MARGINS AND OVERHEAD 87
D. MANUFACTURING METRICS 89
E. PRICING INFORMATION 89
F. SHIPPING AND TRANSPORTATION 90
G. GOVERNMENT POLICIES AND ITS EFFECT ON PRICE 91
H. PROCESSING ASSETS AND IMPLICATIONS ON THE MANUFACTURING: 93
VIII. Industry Capacity and Investment 95
A. CAPACITY UTILIZATION ISSUES 95
B. EFFECT OF CAPACITY UTILIZATION ON COSTS 95
C. NEW POTENTIAL CAPACITY 95
D. CO-PRODUCTS MANAGEMENT 97
E. INVESTMENT 98
F. INCREMENTAL CAPACITY 100
G. SMALLER INCREMENTS 101
H. CAPITAL ASSOCIATED WITH THE INCREMENTAL BUSHEL PROCESSED 101
I. CAPACITY BY PLAYERS IN THE US 101
J. HISTORICAL PERSPECTIVE OF CAPACITY INCREASE 104
K. STARCH AND ETHANOL ASSETS INTERCHANGEABILITY 105
IX. Future Trends 109
A. TECHNOLOGICAL DEVELOPMENTS 109
B. BUSINESS, TECHNOLOGY TRENDS AND ISSUES THAT WILL IMPACT CORN PROCESSORS 111
C. STARCH PRODUCTS AND TECHNOLOGY DEVELOPMENTS FEW EXAMPLES: 112
D. COMMERCIAL RESISTANT STARCHES 115
E. BIOTECHNOLOGY (MODIFIED STARCHES, EFFECT ON YIELD AND PRODUCTION COSTS) 116
F. IMPROVEMENT OF STARCH YIELD AND EXTRACTION: 118
G. PATENT SCAN AND NEW OPPORTUNITIES 118
H. TECHNOLOGY TRANSFER 119
I. MARKET DEVELOPMENT OF CO-PRODUCTS 120
K. GMO TECHNOLOGY EFFECT ON THE IMPORT/EXPORT 122
X. Global Issues, Policies and Plant Locations 124
A. MEXICO EXPANSION PLANS AND BENEFITS OF NAFTA 124
B. STARCH MARKETS: CORN (MAIZE), POTATO, WHEAT AND TAPIOCA 124
C. GLOBAL LIST OF STARCH MANUFACTURERS 128
D. GOVERNMENT POLICIES AND POTENTIAL EFFECT ON THE PRICES 134
E. DUTIES AND SUBSIDIES 138
F. OPPORTUNITIES AND POTENTIAL BENEFITS OF MANUFACTURING LOCATION DUE TO DUTIES, SUBSIDIES ANDINVESTMENT INCENTIVES 141
XI. Future Outlook & Summary 144
LIST OF REFERENCES 147
Corn Processing and other facilities in Western Europe and Asia (Jan. 11, 2004) 155
APPENDIX I…151
APPENDIX II……..….…152
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Nicolas Bombourg
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