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Starch Italics Starch Industry Overview Aug/Sep 2010 GIRACT

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Page 1: Starch Italics 6th Edition

Starch Italics

Starch Industry Overview

Aug/Sep 2010

GIRACT

Page 2: Starch Italics 6th Edition

Starch Italics Table of Contents Starch Industry Overview Aug/Sep 2010

Aug/Sep 2010 © GIRACT 2010

Crops and grains

p.1 European Commission OKs 6 strains of GM

maize for food and feed

Corn, soybean premiums drop as price rally

spurs farmer sales

p.2 Corn falls from 13-month high as slowing

economy May cut food, fuel demand

Maize weakens on dull demand at higher levels

p.3 Record corn crop forecast

p.4 Private exporters report sales activity for Egypt

BASF plant science identifies case of low level

comingling in Amflora fields in Sweden

p.5 Investigation into starch

Impact from tapioca price

Belarus‘ potato export may reach 1 mio t within

5 years

p.6 China cassava processors seek partners

p.7 Maize starch buyers switch to tapioca

Starch and derivatives

p.7 Kellogg to cut sugar levels in cereal

p.8 Now, Rasna to enter health drink segment

DJ Cargill Executive: India To Export 1 mio t

Sugar

More food companies banish high-fructose corn

syrup

Bio-plastics

p.9 Strong growth predicted for US bioplastics

p.10 US demand for degradable plastics to grow

16.6%

Corn starch bags promise to send plastic

packing

p.11 Cereplast sees larger quarterly loss

Bioplastics company Cereplast one to watch in

2010

p.12 US degradable plastics demand to grow 16.6

percent annually

Developments in polypropylene from propylene

derived from renewable feed stocks

p.13 Cereplast Investing More Than USD 7 lakh in

Seymour, Indiana

Bio-fuels

p.13 ADM profits soar 550% as ethanol margins

improve

p.14 10 of Cargill's Next-Gen biofuel bets

Company News

p.14 Cargill: Wheat supplies up from 2008, trade

barriers a threat

p.15 EU-China trade row looming over potatoes

Corn Products International Inc.

p.16 Tongaat Hulett remains well positioned to

benefit

p.17 A look at Archer Daniels Midland's fourth-

quarter results by unit

Anil Products‘ PAT zooms 121 pc, plans global

expansion

Cargill ends fiscal year with doubling in Q4

profits

p.18 Cargill reports strong fourth quarter results but

overall annual decline

Corn Products gets FTC green light for National

Starch acquisition

p.19 Heartland Sweeteners honored as one of

Indiana's companies to watch

Others

p.19 EU-China trade row looming over potatoes

Regional Language News

Thailand

p.20 Bio-gas' capture renewable energy market

Delivery Strategy document 2. Focused research

costs - increase productivity

p.21 Thailand's Chia Tai International trade office in

China

The starch market gaps, cassava starch is still

high

(Table of contents continued on next page)

Page 3: Starch Italics 6th Edition

Starch Italics Table of Contents Starch Industry Overview Aug/Sep 2010

Aug/Sep 2010 © GIRACT 2010

GIRACT Global Starch and Starch Derivatives study

Giract has just published new multi-

client research into global starch

supply, examining in particular the

impact of the recent economic

downturn on the industry. Details on

the following page.

Regional Language News (Contd’)

Thailand

p.22 Malaysia - Indonesia Army buy Thai rice- A

Commercial mediation success

Reclamation of agricultural products: cassava

starch crop season arrival of the foreign national

is up or down?

Brazil/Argentina

p.22 Parana farmers complain of corn prices

p.23 Tereos has lost USD 17 mio

Government guarantees to support the sale of

maize

p.24 Bahia wants to introduce cassava starch in the

production of bread and pasta

China

p.24 First Shanghai : China starch slightly weaker

than expected profit

Russia p.25 Ukraine is determined by the regime of exports

of maize in 2010, closer to its cleaning -Minister

of Agrarian Policy

Vietnam

p.25 Cassava dishes are bringing large benefits to

farmers p.26 Song Dinh cassava starch factory : Striving to

produce 29kt of cassava starch in the 2010-2011

crop

Tay Ninh cassava price increases, large grower

interest

GLOSSARY

bio ‗000 000 000

cpd cases per day

crore ‗0 000 000

JV Joint Venture

k ‗000

kt ‗000 t

klpd kilo litres per day

lakh ‗00 000

lpd litres per day

mio ‗000 000

M&A Merger

&Acquisition

pa per annum

t t

tpa t per annum

tpd t per day

tph t per hour

tpm t per month

Page 4: Starch Italics 6th Edition

GIRACTStarches and DerivativesImpact of the economic downturnGlobal Production and Supply 2009/10 – 2015

INTRODUCTION The starch industry is one of the world’s largest transformers of agricultural raw material, producing 73 million tons (expressed as primary starch with 12% moisture). For 30 years the starch industry has posted a remarkable average 4% annual growth and shown great flexibility to adapt to changes and opportunities, from raw material sources and changing trade regulations to new production technologies and end-use sector dynamics.

Since 2007, this dynamic has changed abruptly for several reasons:

High demand for agricultural raw materials by the fast growing Asian economies coincided with new competition from the bio-energy boom, especially in USA, leading to a record high in raw material cost

High ingredient costs forced the food industry to undertake a strong cost-cutting drive, and even though starch and their derivatives were earlier seen as ‘low-cost’ ingredients, they have now become a target for replacement in several end-uses

Starch production in Asia continued to expand, fuelled by strong local consumption especially in China, while European players were facing more blows from the ongoing CAP reform in the sugar and potato starch sectors

The economic recession affected starch demand as never before and in almost every end-use sector; e.g. the European paper industry saw a decline by 40% and with enough new mills in low wage countries, this demand in Europe may never be recovered.

Thus, the traditional patterns in starch production and demand have changed dramatically and so did the competitive landscape. The dominant position of Western players and markets is being eroded, both in terms of product portfolios and players and China has emerged as the largest country for supply and demand of starch. Cost-effectiveness and clean labelling have been driving changes in demand.

As these new patterns are emerging, it is the right time for every player and end-user in this field to take stock of new opportunities and threats before making any strategic decisions. This report provides the necessary comprehensive picture of actual global starch production and trade, by product and area, and explores which key factors are likely to influence the future to 2015.

Giract, the ingredients and technologies specialist and leader in market analysis of starches and their derivatives, published landmark studies in ’95, ’00, ’04 and ‘07 which pulled together starch supply by type of raw material and player across the world. These studies have been a reference for all players in the industry and for key end-users. The present update, published in autumn 2010,takes into account the various changes that have occurred across the world in the last few years, and thus acts as an important tool in your strategic planning.

OBJECTIVES • To identify starch and derivative production- by key country/region- by type of raw material- by type of starch and starch derivative- by key producer

• To evaluate trade patterns of different types of starches and derivatives• To estimate availability of starches and derivatives by key country/ region

and of starch by type of raw material• To forecast global trends in starches and derivatives to the year 2015

PRODUCTS Primary starch from different raw materials, including maize, wheat, potato and tapioca. Finished products as starches (native and modified) and starch derivatives (glucose syrup, high fructose syrup, dextrose, other hydrolysates and polyols)

MARKETS Global

TIMESCALE 2009/10 and 2015

REPORT Published September 2010

SUBSCRIPTION Please contact us for subscription details

For more info, contact GIRACT V. Krishnakumar, Jo Goossens24, Pré-Colomb Tel: + 41 22 779 05001290 Versoix/Geneva Fax: + 41 22 779 0505Switzerland [email protected]

www.giract.com

Page 5: Starch Italics 6th Edition

Starch Italics Crops and grains Starch Industry Overview

Aug/Sep 2010 © GIRACT 2010 P a g e 1

European Commission OKs 6 strains of GM maize for food and feed

The European Commission (EC) has approved 6 new

varieties of genetically modified (GM) maize for use as

food and feed in the EU, but not for cultivation. The

authorisations are valid for 10 years.

The approval of the six new maize varieties is the result

of a decision taken by the Commission after member

states failed to return majority decisions either for or

against the approval. Each of the 6 GM maize varieties

in question has received a positive safety assessment

from the European Food Safety Authority (EFSA). EU

member states are deeply divided over GM products.

Critics of GM goods emphasise that the long-term

impact of genetic modification for human and

environmental health is unknown. Member states

Austria, Bulgaria, Germany, Greece, Hungary, Ireland

and Luxembourg have banned the cultivation of

GM seeds, while the Czech Republic, the Netherlands

and the United Kingdom are open to allowing their

farmers to grow the altered crops.

In a recent proposal, the Commission suggested that

each of the bloc‘s member states should be allowed to

decide for themselves whether to allow the cultivation

of GM crops within their borders.

Before states could ban or approve them, however, any

strains would need to undergo a safety assessment by

European Food Safety Authority (EFSA) and receive

EU approval. Of the approvals announced this week,

one renewed a previous decision on Syngenta‘s

insect-resistant Bt11 maize that expired in 2007, while

the other 5 were for stacked maize varieties, which

combine insect and herbicide resistance.

(Continued in next column)

European Commission OKs 6 strains of GM maize for food and feed (Contd)

One of those strains is from Sygenta, two were jointly

developed by DuPont and Dow Agro Sciences, and two

are from Monsanto. Exporters of GM crops outside the

EU are likely to increase their pressure on the EU to

open its markets to imports of the altered crops. The EU

has a zero-tolerance policy on unapproved GM material

in imports. Just last year, Europe‘s supply chains of

animal feed were disrupted when GM-tainted shipments

of feed from the US were turned back at the EU border.

The US has long been critical of the EU‘s anti-GM

position, arguing that it is not in line with Europe‘s

commitments at the World Trade Organization.

(ictsd.org 4 August 2010)

Corn, Soybean Premiums Drop as Price Rally Spurs Farmer Sales

Cash premiums for corn and soybeans shipped to export

terminals near New Orleans declined relative to

Chicago futures as farmers increased sales following a

rally in prices. Corn futures for September delivery fell

1%, or 0.3%, to close at USD 3.895 a bushel on the

Chicago Board of Trade. Soybean futures for

November delivery, the most-active contract, rose 8%,

or 0.8%, to USD 10.18 a bushel. The price for August

delivery was little changed at USD 10.535.

(Continued on next page)

Page 6: Starch Italics 6th Edition

Starch Italics Crops and grains Starch Industry Overview

Aug/Sep 2010 © GIRACT 2010 P a g e 2

Corn, soybean premiums drop as price rally spurs farmer sales (Contd)

Corn production will rise to a record 13.43 bio bushels

this year and soybean output will total 3.428 bio

bushels, the highest ever, FCStone Group Inc., a

research company in West Des Moines, Iowa, said

today. In the top 18 producing states, 53% of soybeans

were setting pods and preparing to fill them with beans,

up from 33% a year earlier the 48% average of the prior

five years, the government said yesterday.

Starch accumulation in kernels in the top

corn-producing states was estimated at 31%, up from

17% a week earlier and 13% a year earlier, the USDA

said. ―We will have good crops this year, and we have

them early,‖ reducing demand for lower-quality

supplies from last year, Emslie said. ―The corn harvest

has already begun in the South,‖ and soybeans should

begin by the middle of next month (businessweek.com

3 August 2010)

Corn falls from 13-month high as slowing economy May cut food, fuel demand

Corn fell from a 13-month high as slowing U.S. job

growth signaled that a faltering economy may limit

demand for grain used to make food, animal feed and

ethanol. Company payrolls rose less than expected in

July, the government data showed today, signaling the

economy may be slow in recouping the 8.4 mio jobs

lost since the recession began in December 2007. The

U.S. is the world‘s biggest corn grower, exporter and

consumer. Crude oil fell as much as 1.5%, and hog

futures slipped to a three-week low.

Corn futures for December delivery fell 6 cents, or

1.4%, to USD 4.12 a bushel, on the Chicago Board of

Trade. A close at that price would be the biggest

decline since July 26.

(Continued in next column)

Corn falls from 13-month high as slowing economy May cut food, fuel demand (Contd)

Yesterday, the most-active contract touched USD 4.39,

the highest price since June 15, 2009, after Russia

imposed a ban on grain exports as a drought damages

crops. Before today, corn gained 20% since June 29, the

day before the government said that U.S. farmers

planted less this year than they had planned. Corn is the

biggest U.S. crop, valued at USD 48.6 bio in 2009.

(bloomberg.com 6 August 2010)

Maize weakens on dull demand at higher levels

Maize futures traded on a negative note during a

session on weak demand at higher levels in the spot

market. Maize futures are expected to trade on a

positive note during the day on short covering over

previous fall and coupled with buying interests at lower

levels. The spot prices at major markets in Nizamabad

are hovering around INR 1045 to 1050 per quintal

There is good demand from poultry and starch industry,

but the traders are waiting for the prices to fall further

for their buying. Demand is also expected from

neighboring states as they are running short of stocks.

However, Bihar is catering to the requirements of

northern states According to recent government

estimates, India's maize production may go up in

2010-11 crop years to over 19 mio t on prospects of

good rains, better usage of seeds and a higher acreage

in traditional paddy growing states.

While in AP region maize sowing is seen not as per

expectations as the farmers in Andhra Pradesh have

turned to Soybean, which is more profitable compare to

Maize. (commodityonline.com 5 August 2010)

Page 7: Starch Italics 6th Edition

Starch Italics Crops and grains Starch Industry Overview

Aug/Sep 2010 © GIRACT 2010 P a g e 3

Record Corn Crop Forecast

U.S. corn production is forecast at 13.37 bio bushels, up

255 mio bushels from last year and, if realized, the

largest corn crop on record. Harvested acreage is

forecast at 81 mio acres for grain, unchanged from last

month but up 1.4 mio from last year. Based on the

conditions, yields are expected to average 165 bushels

per acre, up 1.5 bushels from last month‘s yield

projection of 163.5 bushels and the actual 2009 yield of

164.7 bushels. If realized, this would be the highest

yield on record.

(Continued in next column)

Record Corn Crop Forecast (Contd)

The August 1 corn objective yield data indicate the

second highest number of ears per acre on record for

the combined 10 objective yield States (Illinois,

Indiana, Iowa, Kansas, Minnesota, Missouri, Nebraska,

Ohio, South Dakota, and Wisconsin), only behind the

record year of 2009. Record-high ear counts are

forecast in Illinois, Minnesota, Missouri, and

Wisconsin. As of August 8, 71% of the crop was rated

in good to excellent condition in the 18 major corn

producing States, up 3% points from a year ago.

Total corn use for 2010-11 is forecast up

130 mio bushels to 13.49 bio bushels this month as a

result of increased exports and FSI. FSI use is increased

30 mio bushels to 6.09 bio. High-fructose corn syrup is

raised 20 mio bushels to 525 mio as a result of expected

increased exports to Mexico. Glucose and dextrose and

starch are both raised 5 mio bushels to 260 and

250 mio, respectively, for 2010-11. Corn used for

ethanol remains unchanged this month at

4.7 bio bushels. As foreign feed wheat prospects are

reduced this month, U.S. exports for 2010-11 are

increased 100 mio bushels to 2.05 bio. Increases in

production are more than offset by higher expected total

use and lower carryin reducing projected ending stocks

61 mio bushels this month to 1.312 bio.

For the 2009-10 marketing year, imports are lowered

2 mio bushels to 8 mio this month and exports are

raised 25 mio bushels to 1.975 bio, reflecting shipments

to-date. Corn used in HFCS and glucose and dextrose

are both raised this month to 515 mio and

255 mio bushels, respectively. HFCS was raised

because of strong exports in June and a reduction in

Mexico‘s 2009-10 sugar production. Starch use is also

increased 5 mio bushels to 245 mio. Ending stocks for

2009-10 are lowered 52 mio bushels to

1.426 bio bushels. In the 2008-09 marketing year,

exports are lowered 9 mio bushels to 1.849 bio bushels.

(Continued on next page)

Page 8: Starch Italics 6th Edition

Starch Italics Crops and grains Starch Industry Overview

Aug/Sep 2010 © GIRACT 2010 P a g e 4

Record Corn Crop Forecast (Contd)

FSI use is raised by 32 mio bushels to 5.025 bio

because of revision to monthly ethanol production by

the Energy Information Administration. Together, the

revisions lower feed and residual use 23 mio bushels to

5.182 bio for 2008-09. Corn prices received by farmers

for 2010-11 are projected at USD 3.5-4.1 per bushel, up

5 cents on both ends of the range this month. The

marketing year average reflects higher prices for corn

with tighter ending stocks and lower global feed grain

supplies. The 2009-10 corn price remains unchanged at

USD 3.5-3.6 per bushel. (cattlenetwork.com 16 August

2010)

Private Exporters Report Sales Activity for Egypt

Private exporters reported to the U.S. Department of

Agriculture export sales of 240kt of corn for delivery to

Egypt during the 2010-11 marketing year.

The marketing year for corn began September 1. USDA

issues both daily and weekly export sales reports to the

public. Exporters are required to report to USDA any

export sales activity of 100kt or more of one

commodity, made in one day to one destination. Eastern

time on the next business day following the sale. Export

sales of less than these quantities must be reported to

USDA on a weekly basis. (fas.usda.gov 18 August

2010)

BASF Plant Science Identifies Case Of Low Level Comingling In Amflora Fields In Sweden

BASF Plant Science identified extremely small

quantities of Amadea potatoes in Amflora fields planted

in Northern Sweden during the course of the regular

in-house quality controls. The fields in question have

been planted for seed multiplication of the genetically

modified starch potato Amflora.

(Continued in next column)

BASF Plant Science Identifies Case Of Low Level Comingling In Amflora Fields In Sweden (Contd)

Amadea is BASF‘s second starch potato variety that

was submitted last week for regulatory approval in the

EU by BASF Plant Science. The level of comingling is

less than 0.01%, which translates to 47 Amadea plants

among approximately 680kt Amflora plants.

BASF Plant Science removed all Amadea plants from

the fields. The comingling was identified because

Amadea flowers are white, while Amflora only

develops a few violet flowers. All Amadea plants have

been removed during the growth period and did not

enter the commercial starch production. No Amadea

potatoes were identified in these fields.

Amflora and Amadea are two genetically modified

potato varieties that produce pure amylopectin starch.

Conventional potatoes produce a mixture of

amylopectin and amylose. In many potato starch

applications, for example in the paper, adhesive and

food industries, only amylopectin is needed, and

separating the two starch components is uneconomical.

Amflora and Amadea produce pure amylopectin starch

and thus help to save resources, energy as well as costs.

Moreover, paper coated with amylopectin starch has a

higher gloss, and the addition of amylopectin starch to

concrete and adhesives can be processed for a longer

period of time.

In the case of Amflora, BASF Plant Science and its

partners in the starch industry decided to focus on

industrial applications. Due to the demand for

amylopectin starch in the food industry, BASF Plant

Science will be working with its partners to evaluate

potential applications for its Amadea potato in this area.

(ttkn.com 7 August 2010)

Page 9: Starch Italics 6th Edition

Starch Italics Crops and grains Starch Industry Overview

Aug/Sep 2010 © GIRACT 2010 P a g e 5

Investigation into starch

The Ministry of Commerce announced Monday on its

website that it will launch an anti-subsidy investigation

into potato starch imported from the EU. It was the first

time for the country to launch such an investigation

against the European Union.

The ministry decided to launch the investigation after

receiving an application from the China Potato Starch

Society June 30, which accused the EU organizations

and its member governments of having given subsidies

to the accused potato starch companies.

According to the announcement, the investigation will

be completed August 30, 2011, and can be prolonged to

February 29 under special circumstances.

(business.globaltimes.cn 31 August 2010)

Impact from tapioca price

Increasing tapioca starch prices will likely delay some

cassava-based food additive projects, say

manufacturers. Domestic prices of tapioca starch have

been rising strongly in line with costly cassava roots, as

output has dropped due to drought and an invasion of

pink cassava mealybugs. Starch prices hit 19.50 baht a

kg on average this month, driving export prices above

USD 600 per t, compared with 12 baht per kg and

USD 400 per t earlier this year and 8 baht a kg and

USD 280 per t last year.

Chaodee, a producer and exporter of tapioca starch,

plans to invest 200 mio baht to produce maltodextrin, a

polysaccharide used as an additive in food and medical

products. Strong starch prices decrease the

competitiveness of cassava-based maltodextrin

compared with imported products produced from other

kinds of flour. Corn-based starch from China is now

23-24 baht per kg, compared with 27-29 baht for

cassava-based maltodextrin made here.

(Continued in next column)

Impact from tapioca price (Contd)

Cassava production is estimated to drop to 20-21 mio t

this year, or 30% from the previous season. The

company, located in the Northeast, uses about 2kt of

cassava roots a day to make 500t of starch for local

paper makers such as Siam Cement and for export to

China, India and Japan. Plans to produce ethanol from

cassava have also been put off until production returns

to normal levels, he said.

The maltodextrin project received support from the

Industrial Technology Assistance Programme (iTAP).

iTAP has teamed up with the Suranaree University of

Technology to provide technical support for the project,

which plans to produce about 50 litres of maltodextrin a

day. The agency is also helping the company to turn

cassava waste into bio-fertiliser. (bangkokpost.com 28

August 2010).

Belarus’ potato export may reach 1 mio t within 5 years

Belarus Alexander Lukashenko,the President said, that

within the next five years Belarus‘ potato export may

reach 1 mio t, visited the company Otechestvo,

Pruzhany District, on 7 September. The President was

told that there are plans to increase the land under

potato from 51 000 hectares now to 65 000 hectares

within the next five years. Potato production in the

public sector may be doubled to reach 2 mio t. Out of

the figure 500kt can be exported. After talking to the

Brest Oblast Governor the Belarusian head of state said

he believes that Belarusian producers are capable of

exporting up to one mio t of potatoes.

Alexander Lukashenko was informed that the improved

seed production system will allow concentrating seed

potato production in 16 seed production companies,

enabling potato seed certification at every stage, fully

satisfying the demand of corporations and individuals

for quality seed potatoes. (Continued on next page)

Page 10: Starch Italics 6th Edition

Starch Italics Crops and grains Starch Industry Overview

Aug/Sep 2010 © GIRACT 2010 P a g e 6

Belarus’ potato export may reach 1 mio t within 5 years (Contd)

There are plans to continue making potato cultivation

companies larger, with land under potatoes in each

company at least as large as 300 to 500 hectares. The

larger companies will need specialized machines for

cultivating and harvesting potatoes. For the sake of

developing potato production there are plans to build

new up-to-date potato storage facilities and remodel

and upgrade the existing ones with their total capacity

close to 400kt.

As far as potato processing is concerned, there are plans

to start manufacturing up to 18kt of starch, around 12kt

of potato products. It will be necessary to create their

own feedstock zones for the sake of cultivating potatoes

for specific uses in order to manufacture specific

products. To further develop potato growing, there are

plans to use large companies, which land under

potatoes is as large as 300-500 hectare in each

company, to set up 14 integrated structures to

manufacture, store, process and sell potato and potato

products. Specialists believe that all these measures will

allow raising the quality of food potato and industrial

potato, enabling the production of an extensive range of

potato products, reducing potato processing wastage as

well as potato products import. (law.by 7 August 2010).

China cassava processors seek partners

More than 30 Chinese cassava importers and suppliers

of cassava processing technology met local businesses

on September 7 in HCM Cityto exchange information

and seek business partners. The meeting was arranged

by the Trade Promotion Agency under the Ministry of

Industry and Trade, the China Trade Office inVietnam,

the China Cassava Starch Industry Association and the

Vietnam-China Trade Promotion Centre.

(Continued in next column)

China cassava processors seek partners (Contd)

Cassava, an edible root, has become an increasingly

profitable export for Vietnam due to growing demand

in foreign markets, said Le Xuan Duong of the Trade

Promotion Agency.

With the huge demand for cassava used to produce

food, animal feed and ethanol-blended petrol,China

every year needs to import more than 6 mio t of cassava

to meet its production needs. Vietnam has more than

5 lakh hectares under cassava cultivation and an output

of more than nine mio t of fresh cassava a year. Of this,

it annually exports more than 4 mio t after meeting

domestic demand. Duong said, Vietnam‘s cassava

exports are mostly starch powder and dried chips.

However, Vietnam was only able to export 1.14 mio t

of cassava worth 307 mio USD in the first six months

of this year, down 52.4% in volume and 12.8% in value

compared to the same period last year.

Wen Yu Ping, Chairwoman of the China Cassava

Starch Industry Association, said China was a huge

market for cassava chips and starch, but most cassava

products in Vietnam were produced on a small-scale,

making it difficult for Chinese importers to purchase in

large volumes.

Khanh said,Cassava is now an important source of

income for small farmers in many provinces. Cassava

area and output have increased strongly in the last

decade, from 234 000 hectares in 2 000 to

560 000 hectares in 2009, with yields increasing from

8.6 t per hectare in 2 000 to 16.8t per hectare in 2009.

But the rapid development of cassava production has

also raised environmental concerns because the soil is

exhausted after two or three crops. The sector therefore

needs to adopt appropriate cultivation techniques to

maintain output and protect the soil, Khanh cautioned.

(english.vietnamnet.vn 8 August 2010)

Page 11: Starch Italics 6th Edition

Starch Italics Crops and grains Starch Industry Overview Starch and Derivatives

Aug/Sep 2010 © GIRACT 2010 P a g e 7

Maize starch buyers switch to tapioca

Maize starch buyers are watching the trend before

switching over to tapioca starch on the back of falling

tapioca prices in the recent months. Maize prices have

increased by 10-15% in the past one year because of

surging demand for the commodity from poultry

industry while tapioca starch price declined by a

whopping 30% in the past eight months. According to

an analyst from Karvy Comtrade, spot price of maize is

currently pegged at INR 1 125 a quintal at Nizamabad

in Andhra Pradesh. The rise in maize prices has pushed

starch to over INR 1 000 per 50-kg mark. Around 65-kg

starch can be grinded from 100 kg of maize.

Maize starch is mainly used as raw material for

industrial purposes. Industries like textiles, paper,

adhesives, confectioneries, dyes and chemicals,

pharmaceuticals and corrugated boxes use maize starch

as a raw material. Due to fall in tapioca prices,

manufacturers are expected to start buying tapioca

starch in place of maize starch, said J Manjunath,

member of Sago Serve, the only government-run

exchange to trade tapioca products. Currently, price of

tapioca starch has declined to INR 2 100 90-kg bag

from INR 3 200 in January, he said.

Although, price of tapioca starch is almost same as

maize starch, traders are stocking tapioca starch on

hopes of a rise in maize prices sometime in the coming

months, said Rajasekar, a leading tapioca merchant

from Salem in Tamil Nadu.

A report released by Karvy Comtrade said that fresh

arrivals of maize crop is likely to be delayed this year

due to late sowing. The report further added that maize

production is expected to touch 20 mio t this year on

higher acreage and improve yield. Price of the

commodity is expected to go up in the coming months

over fears of crop damage in Karnataka, one of the

major producer of maize in India. (financialexpress.com

9 August 2010)

Kellogg to cut sugar levels in cereal

Health and consumer groups have given a guarded

welcome to the decision by Kellogg to cut the sugar

content of one of its best-sellling children‘s cereals. The

company said it would cut sugar levels in Coco Pops

from 35% to under 30% from next year. Minister of

State at the Department of Food Ciarán Cuffe

welcomed the announcement and called on Kellogg to

extend the initiative to other products.

The Irish Heart Foundation (IHF) and the Consumers‘

Association described the move as a step in the right

direction. However, IHF chief executive Michael

O‘Shea claimed Coco Pops was still an unhealthy

product, and pointed out the new sugar level was twice

that recommended by the UK Food Standards Agency.

Children‘s cereals have been under fire from health

groups for their high sugar, salt and fat levels, which

campaigners claim are contributing to rising levels of

obesity among young people. As a result, sales of

Coco Pops had begun to fall. Kellogg said yesterday its

move was driven by consumer demand rather than any

scientific evidence that high sugar levels were

contributing to obesity.

Jim McNeill, Kellogg Company of Ireland managing

director, said the sugar is to be replaced with starch

from grains and glucose syrup with no use of artificial

sweeteners. Vitamin D is also to be added. He said

Kellogg planned to make further reduction in sugar

levels in Coco Pops in the future, and in other products

in its range. Salt levels have been cut by 44% over the

past 12 years, according to the company. Irish cereal

consumption is the highest in the world, at 8.2 kg per

person per year. (irishtimes.com 5 August 2010)

Page 12: Starch Italics 6th Edition

Starch Italics Starch and Derivatives Starch Industry Overview

Aug/Sep 2010 © GIRACT 2010 P a g e 8

Now, Rasna to enter health drink segment

Soft drink concentrate maker Rasna is looking at

foraying into the health beverages segment with the

launch of three glucose and energy products next

summer, according to chairman and managing director,

Piruz Khambatta. It is also planning to increase the

number of Devil‘s Workshop stores, the company‘s fast

food chain.

The company is currently test marketing its

glucose-based product in Kolkata. The glucose-based

concentrate market has two players, Dabur with

Glucose-D and Heinz with Glucon-D. ―Glucose

concentrate in India is seen as an ultimate health

product. We are currently test marketing Rasna Glucose

Plus in Kolkata. We are also looking at launching

energy drinks simultaneously. We would be launching

these products during the summer of 2011,‖ said

Khambatta.

The new products from Rasna will be targeted at the

mass segment and priced between INR 2 and INR 10.

Rasna is looking at closing FY2011 at INR 400 crore.

Khambatta said that the company is also looking at

increasing its sales force, especially in the smaller

markets as almost 45% of its sales come from these

markets. ―In the last couple of years, we have increased

our sales force from 300 to 750. Every year, we

increase the sales force by almost 10-15%. This year,

too, we would do the same,‖ she said.

Rasna is also looking at increasing the number of

Devil‘s Workshop stores from 300 at present to 700 by

March 2011. (mydigitalfc.com 30 August 2010)

DJ Cargill executive: India to export 1 mio t sugar

India will likely export 1 mio t of sugar in the next

marketing year starting October 1 and is set to become

a regular exporter, an executive at agribusiness trading

company Cargill Inc. said Wednesday.

"India is set to become a structural exporter of white

sugar, thanks to Shree Renuka Sugars and Silk Road,"

Jonathan Drake, head of the sugar unit business at

Cargill Sugar, said at the Indian Sugar Summit.

India, the world's largest sugar producer after Brazil,

has resumed exports of sugar after being an importer

for a few years. Drake said China will emerge as one of

the top 10 sugar importers next year.

(tradingmarkets.com 1 August 2010)

More food companies banish high-fructose corn syrup.

First it was calories, then it was fat and sodium. Now,

the latest health concern is high-fructose corn syrup. As

the country deals with obesity issues, ingredients in

food have come under increasing scrutiny, bringing

some confusion to the marketplace but also

opportunities for companies as they try to differentiate

themselves in a competitive grocery store.

Consumer concern has been getting a quick response

from food companies, as many remove high-fructose

corn syrup from well-known products, replacing it with

cane or beet sugar. Sara Lee Corp. is the latest to jump

on board, removing the sweetener from its two

best-selling breads. High-fructose corn syrup is the

widely used and historically inexpensive sweetener.

Many medical and nutritional experts, as well as the

Corn Refiners Association, say that all sweeteners are

metabolized in the same way.

(Continued on next page)

Page 13: Starch Italics 6th Edition

Starch Italics Starch and Derivatives Starch Industry Overview Bio-Plastics

Aug/Sep 2010 © GIRACT 2010 P a g e 9

More food companies banish high-fructose corn syrup (Contd)

A Princeton University study, on the other hand, has

found that long-term consumption of high-fructose corn

syrup does lead to abnormal increases in body fat,

especially around the belly.

Last week, Sara Lee, the maker of Jimmy Dean

sausages and frozen cheesecake, announced it would

remove high-fructose corn syrup from its Soft &

Smooth and 100% Whole Wheat bread lines because

their consumers - mothers in particular - had asked

them toOver the last few years, Kraft Foods Inc. has

removed high-fructose corn syrup from its Capri Sun

juice drinks, Wheat Thins, Premium crackers, Nabisco

100-calorie packs, and the majority of its salad

dressings. A danger, according to nutritionists, is that a

label reading HFCS-free could become synonymous

with healthy. Keri Gans, of the American Dietetic

Association, said both high-fructose corn syrup and

sugar provide a lot of extra calories and no nutritional

value.

Audrae Erickson, president of the Corn Refiners

Association, cited a survey that said only 3.6% of

consumers are concerned about high-fructose corn

syrup: "A sugar is a sugar, whether it's corn sugar or

cane sugar." Production of high-fructose corn syrup has

been on the decline over the last few years, and that's

putting pressure on the corn-growing industry.

For decades, corn syrup reigned as the industrial

food-sweetener of choice. Trade barriers made sugar

more costly to U.S. consumers, and corn subsidies

made the grain-derived sweetener extremely cheap.

However, increased ethanol production in recent years

has boosted the price of corn and, consequently, of corn

sweeteners. The average price of high-fructose corn

syrup during fiscal 2009 was 31% a pound, compared

with 36 cents a pound for sugar, according to the U.S.

Department of Agriculture. (philly.com 26 August

2010)

Strong growth predicted for US bioplastics

The entry of key players such as Cargill-owned

NatureWorks and Novamount in recent years will

ensure capacity growth so that output reaches 325m

pounds (147m kg) by the end of the period, said The

Freedonia Group. Efforts to reduce both pollution and

reliance on oil-based plastics, as well as continued

consumer demand for sustainable and eco-friendly

packaging will also spur growth, said the study

entitled ‗Degradable Plastic‘ to 2014.

The report suggests the success that appeared to elude

the sector for so long could finally be realised as

growing capacity, the increased use of blends and

potential oil-price volatility all combined to boost

demand. Performance of the Bioplastics is also

improving thanks to the use of more polymerisation,

blending techniques and higher yield processing

technology, it added.

The US Bioplastics sector is currently dominated

by polylactic acid (PLA) and starch-based plastics. PLA

is forecast to make annual gains of 20% until 2014 on

greater availability, greater processor familiarity and

performance that will expand potential applications.

An increasing number of suppliers, improved resin

grades and better blending techniques with other

biopolymers are predicted to help starch-based plastics

grow at around 11% per year.

A more buoyant outlook for the sector is spurring the

development of new products –

with polyhydroxyalkanoate (PHA) predicted for most

growth. The study estimates that the development of

new PHA grades will see it capable of replacing

polyolefins in higher performance injection moulded

articles as well as containers, bottles and food service

disposables. Degradable Plastic to 2014 is available

from The Freedonia Group priced US USD4 800

(foodproductiondaily.com 1 August 2010)

Page 14: Starch Italics 6th Edition

Starch Italics Bio-Plastics Starch Industry Overview

Aug/Sep 2010 © GIRACT 2010 P a g e 1 0

GIRACT Sweeteners & Starch Price Monitoring

Giract provides quarterly prices of white sugar,

key starches and their principal derivatives used

in the food industry across major regions. The

report comprises tables and commentary on

price movements as well as charts which track

annual running price series. Details on the

following page.

US demand for degradable plastics to grow 16.6%

US demand for degradable plastics is set to grow 16.6%

per year to 325 mio pounds (147.7 mio kilos) by 2014,

giving the market a value of USD 380m, according to a

new Freedonia report. Freedonia says that even though

degradable plastics have been on the market for

decades, growth was limited because of high cost and

various performance drawbacks.

Now, interest in envinronmental friendly products is

strong and future opportunities will come from

―continued capacity growth, efforts to reduce pollution

and US reliance on petroleum products, and consumer

demand for sustainable, environmentally packaging and

manufactured goods‖, says the firm.

PLA and starch-based plastics currently dominate the

market and both will continue to experience strong

growth. The PLA market is expected to grow 20.5% per

annum to 2014, totalling 140 mio pounds

(63.6 mio kilos). The starch-based plastics market will

grow 11.2% to 85 mio pounds (38.6 mio kilos).

However, Freedonia says a relatively new product –

polyhydroxyalkanoate (PHA) – will experience rapid

growth rates of 103.6%, boosting the market to 35 mio

pounds (15.9 mio kilos) by 2014

―While sales of PHA were negligible in 2009, rapid

growth over the next ten years should boost the product

up among the leading types of degradable plastics,‖

says Freedonia. ―Growth is predicted on significant

capacity increases, competitive pricing and the

development of grades capable of replacing polyolefins

in higher performance injection moulded articles.‖

(europeanplasticsnews.com 2 September 2010)

Corn starch bags promise to send

plastic packing

After gaining popularity in Europe and America, corn

starch bags are finally here and are all set to replace

bags made of plastic and oxy-degradable materials.

―The bags are made of resin drawn from corn starch.

While all other materials have a limited shelf life of six-

eight months, the corn starch bags can be used for as

long as one wishes to. Unlike other materials that

decompose by getting divided into fragments and later

being consumed by bacteria, the bags decompose when

thrown in soil or garbage, enriching the quality of soil.

Once thrown in the litter, 75% of composting process

takes place in 90 days. In four months, the entire bag

composts,‖ said Vivek Mehta of city-based Balson

Industries, sole manufacturer of such bags in Pune.

City-based Protecterra Ecological Foundation (PEF), an

organisation working towards conservation of

environment has been involved in promotion of the

bags. Resembling the texture and look of plastic bags,

the corn starch bags are available in three types — bin

bags for garbage disposal that cost INR 110 for 30

bags, shopping bags and carry bags. Costing INR 300

per kg, the corn starch resin is three times costlier than

plastic which is INR 90 per kg, despite which the

manufacturers are optimistic. (expressindia.com 1

August 2010).

Page 15: Starch Italics 6th Edition

GIRACT

Sweeteners & Starch Price MonitoringQuarterly Price Review of Starches, their derivatives and Sugarin Key World Markets

Now in its 10th successful year !

Giract provides quarterly prices of white sugar, key starches and their principal derivatives used in the food industry across major countries. This report comprises tables and commentary on price movements. In addition, charts track annual running price series.

Why should you subscribe to this Price Monitoring?

Because you are closely involved with these products and often find it difficult - or impossible - to obtain ex-manufacturer price estimates on a comparative scale across countries

Because this is an efficient mechanism to remain abreast of developments

Because this monitoring programme has been endorsed by key players including ADM, Avebe, BASF, Cargill, CPI, Lyckeby, Novartis, Unilever, Dupont, …

Because Giract is well-known for its in-depth analyses of the world starch and sugar industries over the last 30 years.

What does this Price Monitoring contain?

Compact tables which provide ex-factory prices in local currency and USD for the key products and countries as shown below (relevant raw materials for each country), along with charts tracking price trends.

Glucose syrup HFS Native Starch Cationic Modified WhiteDE 40-42 DE 63-65 DE <20 42% 55% Maize Wheat Potato Tapioca Starch* Starch

food grade+

Sugar

LatAmChinaEUIndiaRussiaThailandUSA* LatAm, China, India, Russia, Thailand+ EU, USA

How do you subscribe to this Price Monitoring ?

By simply filling in the form below and returning it to us or subscribing online at www.giract.com.

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Page 16: Starch Italics 6th Edition

Starch Italics Bio-Plastics Starch Industry Overview

Aug/Sep 2010 © GIRACT 2010 P a g e 1 1

Cereplast sees larger quarterly loss

Bio-plastics maker Cereplast Inc. reported on Monday a

slightly larger second quarter loss due to higher costs

and lower revenue associated with opening an Indiana

plant.

The El Segundo company also announced a new chief

financial officer. Cereplast reported a net loss of

USD 1.7 mio, compared with a net loss of

USD 1.05 mio a year earlier. The company said the

increase was largely due to restructuring costs as it

moved its distribution and manufacturing operations

from Los Angeles County to Seymour, Ind. Net revenue

fell 24% to USD 684 431, due in part to the plant

relocation.

The company also said it absorbed one-time costs in

connection with moving its stock listing to the Nasdaq.

It had been traded over the counter.

Cereplast makes plastic resin out of 100% renewable

raw materials, including corn, wheat and potato

starches. Most resin is derived from petroleum.

Cereplast announced that it promoted

Heather E. Sheehan to chief financial officer, effective

August 16.

Prior to joining Cereplast, Sheehan served as CFO of

Exemplis Corp. and worked at ConAgra Inc.,

International Rectifier Corp. and Trans Mountain Pipe

Line Co. She earned a bachelor of business

administration degree in accounting from Simon Fraser

University in Vancouver, British Columbia. Shares

closed down 3%, or less than 1%, to USD 3.22 on the

Nasdaq. (labusinessjournal.com 16 August 2010).

Bioplastics Company Cereplast One To Watch In 2010

Following a recent USD 7.5 mio fundraising and new

contract wins, sustainable plastics company Cereplast

is on firm footing for the remainder of the year, and is

poised as the one company for investors to watch as the

bioplastics industry grows due to new and improved

economic and policy measures.

Cereplast designs and manufactures proprietary starch-

based, renewable plastics. These resin families replace

a significant portion of petroleum-based additives with

bio-based material such as starches from tapioca, corn,

wheat and potatoes, meeting the demand from

consumers and manufacturers for sustainable plastics.

Recently, the European Commission published a report

focusing on bio-based initiatives to guide EU politics in

the coming decade. European Bioplastics, a European

branch association representing industrial

manufacturers, processors and users of bioplastics and

biodegradable polymers and their derivative products,

estimates the 2020 market potential for bioplastics will

be a factor of 3 times greater if effective policy support

measures are put in place. Specifically, European

Bioplastics estimates 770kt of bioplastics production

without political support and 2 550kt with supporting

political measures. The latter would represent an

increase in bioplastics market share from its current

0.5% to 5% within 10 years.

(Continued on next page)

Page 17: Starch Italics 6th Edition

Starch Italics Bio-Plastics Starch Industry Overview

Aug/Sep 2010 © GIRACT 2010 P a g e 1 2

Bioplastics Company Cereplast One To Watch In 2010 (Contd)

Cereplast is likely to benefit from this potential growth,

as though the company is yet not profit-making, it is

increasing production partially thanks to a stronger

working capital position after raising fresh capital in

June. Just two months ago, the bioplastics business

entered into agreements to ship 16 mio pounds of

bioplastic resins in 2010, representing up to a whopping

400% increase in shipments over 2009. It also

expanded distribution agreements in South East Asia,

Southern China, South America, Europe and in the

United States with Ashland Distribution.

In its second quarter results, Cereplast recorded that its

gross margin as a % of net sales increased to 30.8%

from 8.6% for the same period last year. Gross profit

rose 157.3% to USD 199211, primarily on account of

cost savings from its new bioplastics manufacturing

facility in Seymour, Indiana, capable of producing

approximately 80 mio pounds of bioplastic resin once

operating at full capacity.

The company even expects its revenues for 2010 to

increase more than 190% over last year to between

USD 8-10 mio, and to achieve operational profitability

by the fourth quarter. As part of its growth strategy,

Cereplast has made new appointments to its team,

including Heather E. Sheehan, who was announced this

week as the new senior vice president and chief

financial officer. (proactiveinvestors.com 20 august

2010).

US degradable plastics demand to grow 16.6% annually

U.S. demand for degradable plastics is forecast to rise

16.6% per year to 325 mio pounds in 2014, valued at

USD 380 mio, according to a new market study from

Freedonia Group Inc. Polylactic acid (PLA) and starch-

based plastics currently dominate the market, and both

products will see strong growth, according to the report. (Continued in next column)

US degradable plastics demand to grow 16.6% annually (Contd)

PLA demand will grow more than 20% per year

through 2014, thanks to increased availability, greater

processor familiarity and performance enhancements

that will expand potential applications.

Freedonia expects strong growth in demand for

polyhydroxyalkanoate (PHA), thanks in part to

development of grades capable of replacing polyolefins

in injection molded applications, as well as in

foodservice disposables, nonwovens, containers and

bottles. Degradable plastics, is available for USD 4 800

from Cleveland-based Freedonia Group.

(plasticsnews.com 31 August 2010).

Developments in polypropylene from propylene derived from renewable feed stocks

Polymers made from renewable feedstocks result in

reduced greenhouse gas emissions when used as a

substitute for petroleum. With significant content

derived from starches, the pricing is not as influenced

by volatile oil prices as traditional plastics. After

developing the market of oil from sugarcane, Brazil is

now looking for a possible green PP derived from

propylene produced from sugarcane.

Braskem and Novozymes succeeded in developing a

new technology to convert sugar into polypropylene.

Brazil's leading PP producer Braskem, has collaborated

with Denmark-based Novozymes for a research project

to develop a process to manufacture PP from

sugarcane. The new polypropylene conversion process

under development will require a new fermentation

process with new microorganisms, with Novozymes‘

know-how. Braskem was the first company in the world

to produce a certified 100% renewable polypropylene

on an experimental basis.

(Continued on next page)

Page 18: Starch Italics 6th Edition

Starch Italics Bio-Plastics Starch Industry Overview Bio-Fuels

Aug/Sep 2010 © GIRACT 2010 P a g e 1 3

Developments in polypropylene from propylene derived from renewable feed stocks (Contd)

Under the terms of the joint development agreement

with Braskem, initial development work will run for at

least five years. Upscaling and further commercial

development will take place in a pilot facility before a

large-scale plant is constructed in Brazil and

commercial products enter the market. It is still a long

way off before a product is manufactured and ready to

be sold.

Hiroshima University and the Japanese automaker

Mazda have joined forces to produce a new range of

polypropylene (PP) materials stemming from non-food

renewable resources with high cellulose content. The

aim is to develop polypropylene by using non food

vegetable products such as plant stalks or wood

shavings.

Cereplast Inc., manufacturer of proprietary bio-based

sustainable plastics, announced the launch of a new

family of resins, Cereplast Hybrid ResinsTM

. The new

resins will complement the existing line of compostable

resins, expanding market applications. Both resin

families are perfectly suited to meet the needs of

converters, manufactures and brand owners interested

in producing and selling environmentally sustainable

plastic.

Known as BiopolyolefinsTM

, they replace 50% or more

of the petroleum content used in traditional plastic

resins with bio-based materials such as starches from

corn, tapioca, wheat and potatoes. With nearly the same

physical characteristics and price point as traditional

polyolefin, they are an ideal way for plastic

manufactures to reduce their reliance on petroleum.

(plastemart.com 31 August 2010).

Cereplast investing more than USD 7 lakh in Seymour, Indiana

Cereplast, a bio-resin manufacturer located in Seymour,

Indiana, has received a USD 1 lakh grant from the

state‘s Recycling Market and Development Board,

the Seymour Tribune reports. The funds are the first the

board has granted since the state froze the board‘s

assets in 2008. The company will use the funds towards

a more than USD 7 lakh expansion, and to hire 38 new

employees. ―Seymour Tribune achieved significant

milestones in the second quarter and further positioned

the company for rapid growth and operational

profitability,‖ said Cereplast founder and CEO Frederic

Scheer.

Cereplast makes fully compostable starch-based

bioresins. Raw materials are derived from renewable

sources such as soy proteins and starches in corn,

wheat, and potatoes. It also makes hybrid resins, which

combine renewable materials with petroleum-based

plastics. (areadevelopment.com 25 August 2010).

ADM profits soar 550% as ethanol margins improve

In Illinois, Archer Daniels Midland Company reported

a 550% jump in quarterly net earnings to USD 446 mio,

reporting that ―profit in ADM‘s Oilseeds Processing

segment increased USD 132 mio due to improved

margins and higher volumes,‖ and that ―corn

Processing profit increased USD 151 mio on stronger

bioproducts results.‖

Overall, the company reported net earnings of

USD 1.9 bio for the year ended June 30, 2010, up

USD 246 mio over the year ended June 2009. The

company reported that ―Bioproducts profit in the

quarter was up significantly from last year‘s loss due to

better ethanol and lysine margins.

(Continued on next page)

Page 19: Starch Italics 6th Edition

Starch Italics Bio-Fuels Starch Industry Overview Company News

Aug/Sep 2010 © GIRACT 2010 P a g e 1 4

ADM profits soar 550% as ethanol margins improve (Contd)

At present, ADM has begun production at its Cedar

Rapids, Iowa, ethanol dry mill, which should be fully

operational by the end of August. And, in Decatur, Ill.,

the Company is working through startup issues at its

propylene glycol plant, which should be fully

operational by end of the calendar year.‖

(biofuelsdigest.com 4 August 2010)

10 of Cargill's Next-Gen biofuel bets

Global agriculture and food gorilla Cargill made

USD 2.6 bio in profit in 2010: The over-a-century-old

company, which is one of the largest private companies

in the U.S.Cargill is one of the larger producers of

ethanol and biodiesel in the U.S. and has corn ethanol

production plants in Iowa, Nebraska and Missouri, as

well as biofuel assets in Europe, Brazil, Argentina,

among other places.

But Cargill has a longer-term strategy to move from the

low-margin business of trading and processing

commodities to the higher margin businesses of

conducting research and development and creating new

chemical and bio-based intellectual property. Cargill

had revenues of USD 107.9 bio in 2010 to get that

USD 2.6 bio profit. Next-gen biofuels is just one area

that Cargill is looking to develop new IP, and it‘s been

partnering with promising startups to help deliver

innovative biofuel technology. (Continued in next

column)

10 of Cargill's Next-Gen biofuel bets (Contd)

Cargill is a dream-come-true partner for a small biofuel

startup. It has a food and ag distribution chain that

would make Walmart jealous; it sells a good chunk of

the grain and food in the US., so it has feedstocks at its

fingertips; and its traditional biofuel business is ripe for

remaking.

There are 10 next-gen biofuel bets that Cargill is

making: Virent Energy. Gevo,Argentinian

Biodiesel,Brazilian Ethanol, U.S. Cellulosic

Ethanol,Verenium Now BP, UK‘s

Greenergy Biofuels,Cargill Ventures, Jet Fuel from

Animal Waste (gigaom.com 9 August 2010).

Cargill: Wheat supplies up from 2008; trade barriers a threat

Cargill Inc. said Thursday declining wheat supplies due

to an extreme drought in the former Soviet Union are a

regional issue but that global supplies remain

comfortable. The global agribusiness giant, whose

operations include grain sourcing, processing and

transport, said wheat crops in countries such as Russia

and Kazakhstan are significantly below expectations,

which is affecting regional supplies.

"From a global perspective, however, the U.S. wheat

crop has been strong and world wheat stocks are higher

than they were during the wheat price spikes in 2008,"

the Minneapolis-based company said in a statement.

Chicago Board of Trade wheat futures prices soared in

2008 to all-time records above USD 13 per bushel due

to climbing demand and crop failures world wide. (Continued on next page)

Page 20: Starch Italics 6th Edition

Starch Italics Company News Starch Industry Overview

Aug/Sep 2010 © GIRACT 2010 P a g e 1 5

Cargill: Wheat supplies up from 2008; trade barriers a threat (Contd)

Russia said Thursday it would ban grain exports from

August 15 until the end of the year. Cargill didn't say

what effect the situation would have on its business.

Bunge Ltd. (BG), which also transports grain globally

and processes other feed products such as soymeal, said

last week the surging wheat market could have a

positive impact on its grain business.

Another rival, Archer Daniels Midland Co. (ADM),

said during its quarterly conference call Tuesday that

the surging wheat prices could potentially boost U.S.

corn exports. (automatedtrader.net 5 August 2010).

EU-China trade row looming over potatoes

A potentially damaging trade row has flared up between

EU and Chinese trade authorities as China claims

Europe has been unfairly subsidising potato starch

exports. The case is the first of its kind and comes as

EU Customs Commissioner Algirdas Šemeta arrives in

Shanghai to put pressure on China to tackle cigarette

smuggling and trade in counterfeit goods. China fears

EU member states are propping up their potato starch

companies in a way that damages Chinese domestic

industries. The Chinese Ministry of Commerce said it

launched a probe after receiving complaints from the

China Starch Industry Association. Beijing said it

would conduct an investigation in line with World

Trade Organisation (WHO) and domestic rules, and

said the process would be fair and transparent.

If it finds that European governments are conferring an

unfair advantage on its exporters, retaliatory duties

could be slapped on European imports. Commissioner

Šemeta did not plan to discuss the issue during his

discussions with Chinese customs officials this week. (Continued in next column)

EU-China trade row looming over potatoes (Contd)

A spokesperson for the Commission's trade directorate

told EurActiv that Beijing has notified Brussels of its

intention to investigate European potato starch

subsidies. Europe's generally low-key potato starch

industry has found itself in the headlines more than

usual this year, primarily as a result of the European

Commission's decision to allow BASF to manufacture

Amflora – a genetically optimised starch potato

Corn Products International Inc.

Corn Products International Inc. continues to see a

turnaround in business as volumes recovered in all

regions in the second quarter. The company trades at

just 12.3x forward earnings, well under the industry

average of 14.5. Corn Products is the largest producer

of dextrose in the world and manufactures starches,

high fructose corn syrups and glucose. The company

provides a variety of ingredients to customers in

60 industries including food, beverages,

pharmaceuticals, animal feed, corrugating, paper and

textiles.

Corn Products beat by 27% in the second quarter : On

July 27, Corn Products reported its second quarter

results which surprised by 16 cents on the Zacks

Consensus Estimate. It was the fourth straight earnings

surprise. Earnings per share jumped 121% to 75 cents

from 34 cents in the year ago period. Sales rose 10% to

USD 1 bio from USD 912 mio in the second quarter of

2009. In South America, customers were buying in the

brewing, confectionary, processed foods and packaging

industries as sales jumped 26%. Customer demand for

sweetners and starches in South Korea and

confectionary and textile industries in Pakistan drove

volume growth in Asia/Africa which had the best sales

rebound, climbing 35% over last year.

(Continued on next page)

Page 21: Starch Italics 6th Edition

Starch Italics Company News Starch Industry Overview

Aug/Sep 2010 © GIRACT 2010 P a g e 1 6

Corn Products International Inc. (Contd)

Given the volume growth, Corn Products felt confident

enough in the second half of the year to raise guidance

to the range of USD 2.55 to USD 2.75 from its prior

guidance of USD 2.25 to USD 2.60. It also believes it

will close on its National Starch acquisition at the end

of September or early October 2010. Within the last

week, 5 estimates have moved higher and 1 lower for

the third quarter, which has pushed the Zacks

Consensus up by 6 cents to 77 cents. For the full year,

the Zacks Consensus climbed to the higher end of the

company's guidance range, up 18 cents to USD 2.71 per

share.

Corn Products still has attractive value characteristics.

In addition to its low P/E, it also has a value price-to-

book ratio of 1.4, under the industry average of 2.3. The

company's price-to-sales ratio is also within the value

parameters of 0.7, under the industry average of

0.8 and under 1.0, which designates value. Its 5-year

average return on equity (ROE) is solid at 11.4%. Corn

Products also rewards shareholders with a dividend of

1.7%.

Tongaat Hulett remains well positioned to benefit

Tongaat Hulett Limited, a sugar, starch and glucose and

aluminium company, announced Monday it remains

well positioned to benefit from the favourable global

fundamentals of increasing demand for agricultural

products, food, renewable energy and land usage. The

total South African maize harvest in 2010 is projected

to be above 13 mio t, the largest crop in 29 years.

The price of maize in South Africa through to July 2011

is trading close to the world price, which contributes

significantly to the competitiveness of the starch

operation. Sales volumes of starch and glucose in the

last three months have continued to show evidence of

the contraction in consumer spending, particularly in

the prepared foods, confectionary and canning sectors. (Continued in next column)

Tongaat Hulett remains well positioned to benefit (Contd)

Increasing sugar production from the 957kt milled in

the 2009-10 season to the installed sugar milling

capacity of 19 mio t per annum, with a simultaneous

reduction in the unit cost of production, is one of

Tongaat Hulett's key focus areas.

Tongaat Hulett's sugar production for the 2010-11

season in Zimbabwe is expected to be between

330 and 350kt (from 259kt in 2009-10) and in

Mozambique to be between 230 and 250kt (from 134kt

in 2009-10). Sugar production started later than

expected due to unseasonal rain in Mozambique and

extensive rehabilitation work on the Hippo Valley mill

in Zimbabwe. Consistent mill throughput rates close to

capacity, without substantial disruptions, are now

required to crush the available cane crop and conclude

the sugar sales by the end of the season.

In South Africa, rainfall in the KwaZulu-Natal north

coast region during the sugar cane growing months of

January to June 2010 was 252 millimeters compared to

a long-term mean of 491 millimeters. Tongaat Hulett's

sugar production in South Africa is now expected to be

slightly below that of 2009-10 notwithstanding the

hectares under cane supplying Tongaat Hulett's mills

increasing by some 2 000 hectares.

These impact on the revenue streams, costs incurred

and the conversion of profits into Rands. The Rand is

currently 16% stronger against the Euro than it was for

the 2009-10 reporting period. Tongaat Hulett's land and

property development activity is currently focused on

value creation for all stakeholders in the growth

corridor north of Durban. In the current economic

climate, with the sale of development land across most

other sectors being depressed, few hectares are being

converted to development in the higher value prime

locations on the coastline and to the west of Durban.

(foxbusiness.com 2 August 2010).

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A look at Archer Daniels Midland's fourth-quarter results by unit

Operating income jumped USD 132 mio for the fourth

quarter as volumes increased on higher demand

overseas. The demand has been particularly strong in

South America and Europe, where increases offset a

decline of oilseed crushing in North America. Refining,

packaging, biodiesel and other results jumped by

USD 58 mio to 79 mio for the quarter.

Corn processing operating income increased by

USD 151 mio for the quarter, even as profits for

sweeteners and starches fell USD 30 mio.

Ethanol profit margins rose in the quarter, prompting

Archer Daniels Midland to start ethanol production at

its Cedar Rapids, Iowa plant, which should be fully

operational by the end of August.

Operating profits were up by USD 195 mio for the

quarter at the Agricultural Services unit, which includes

Archer Daniels Midland's commodities trading desk

and shipping unit. The company said global demand for

commodities is improving modestly, especially in Asia.

Barge rates fell while fuel prices increased, which hurt

profits in the transportation unit. (canadianbusiness.com

3 August 2010).

Anil Products’ PAT zooms 121 pc, plans global expansion

Anil Products Limited, (APL) has recorded a 121%

jump in its profit at INR 8.82 crore in the quarter ended

June 30, 2010. The company had posted a net profit of

INR 3.9 crore in the year-ago period. The total income

of the Ahmedabad-based firm stood at INR 106 crore in

the first quarter of this fiscal, up 40% as against the

INR 85 crore in the corresponding period a year ago.

(Continued in next column)

Anil Products’ PAT zooms 121 pc, plans global expansion (Contd)

The increase in sales and profits is the result of

successful implementation of business strategy wherein

APL has shifted its focus to value-added products,

APL's Managing Director, Amol Sheth, said in a

statement here.

APL, that makes products such as dextrose

monohydrate, anhydrous dextrose and corn syrup used

in textile, food, paper, pharma and other industries in

India, is also looking at overseas expansion. Sheth said,

"We are looking at expanding our global footprint by

opening dedicated offices in the Middle-East and

European countries this fiscal.‖ Sheth said. This will

allow us to work more closely with our foreign

customers and help us gain marketshare in these

regions. ( ibnlive.in.com 16 August 2010).

Cargill ends fiscal year with doubling in Q4 profits

US food and edible oils giant Cargill ended its fiscal

year with a fourth quarter in which its profits more than

doubled, the company announced this week. Cargill

posted fourth-quarter net earnings of USD 691 mio for

the three months to the end of May, up from USD 327

mio a year ago.

Excluding the results from fertilizer firm The Mosaic

Co., in which Cargill owns a majority stake, fourth-

quarter profits were up 87%.

For the full fiscal year, Cargill‘s profits dropped 22% to

USD 3.33bn. Excluding Mosaic, Cargill‘s earnings rose

14% to USD 2.07 bio. Mosaic had dampened Cargill‘s

earnings in 2009. Fourth-quarter revenues rose 11% to

USD 28.1 bio, although annual sales fell 6% to

USD 107.9 mio. (ausfoodnews.com 19 August 2010).

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Cargill reports strong fourth quarter results but overall annual decline

Cargill, the world's largest agribusiness company, more

than doubled its fourth quarter net earnings compared to

the same period in 2009, but still saw an overall decline

in annual revenues. The US-based business reported its

fourth quarter and annual results on 17 August,

recording net earnings of USD 691 mio for the final

quarter of the company's financial year, compared with

USD 327 mio a year ago. However, annual earnings for

the year ending 31 May 2010 dropped to USD 2.6 bio

from USD 3.3 bio in 2009. According to the company

statement, all five of Cargill's business segments

increased earnings in the fourth quarter. Results were

lifted by lower raw materials costs and a large North

American crop harvest, said Cargill.

Although Cargill does not release detailed financial

results for its business segments, the company

highlighted its 64% holding in fertiliser maker Mosaic

Company as an area that had performed badly last year,

but gave no further information. Despite the fourth

quarter rise in earnings, Cargill remains cautious about

the recovery. "More uncertainty lies ahead, for the

world has yet to transform from a policy-stimulated

upturn to a structurally sustained recovery," the

company said in its annual report.

Greg Page, Cargill's non-family chairman and CEO,

stressed that the company will continue its global

expansion plans throughout the next year. "Over the

past year, we opened 17 new and expanded facilities of

significant scale, including joint ventures. Fifteen more

projects are underway. This represents a global,

multiyear investment of more than USD 1.1 bio," he

said in the statement announcing the results.

Cargill was founded in 1865 by William Wallace

Cargill. The company employs 131 000 people across

66 countries and is still privately owned by the

founding family. (campdenfb.com 18 August 2010).

Corn Products gets FTC green light for National Starch acquisition

Corn Products International, Inc. has announced that

the Federal Trade Commission has granted early

termination of the Hart-Scott-Rodino waiting period

with respect to the Company's planned acquisition of

National Starch, a wholly owned subsidiary of

AkzoNobel. It expects the USD 1.3 bio deal to close in

late September or early October. Dutch paint maker

AkzoNobel acquired National Starch as part of its 2008

acquisition of British paint maker ICI and did not

consider it part of its core business. Corn Products

International is based in Westchester, Ill. The

company's shares were up 31 cents, or 0.9%, at

USD 34.62 Wednesday.

Corn Products International announced that it had

entered into a definitive agreement to acquire National

Starch, a New Jersey-based global provider of specialty

starches, from AkzoNobel, the largest global coatings

and specialty chemicals company, headquartered in The

Netherlands in June. Combining National Starch with

Corn Products will create an ingredient solutions leader

with nearly USD 5 bio in revenues.

National Starch is a recognized innovator in food

ingredients and specialty starches. The company's

technologies are supported by a world-class research

and development infrastructure and protected by more

than 800 patents and patents pending, which drive the

development of advanced specialty starches for the next

generation of food products. National Starch had 2009

revenues of USD 1.2 bio from sales of specialty

starches to both local and multinational customers in

the food, papermaking, consumer and industrial

segments. It has 2 250 employees around the world and

operates 11 plants in eight countries, including new

geographies for Corn Products such as the United

Kingdom, Germany, Australia, and New Zealand.

(foodingredientsfirst.com 19 August 2010).

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Heartland Sweeteners honored as one of Indiana's companies to watch

Heartland Sweeteners is accustomed to receiving

recognition for its xylitol-based Ideal(R) No Calorie

Sweetener. Ideal(R) has always stood apart from other

sugar substitutes and artificial sweeteners on the

market.

But now, Heartland has something new to

celebrate-being honored as part of Indiana's Companies

to Watch. In a ceremony yesterday evening at the

Indiana Roof Ballroom in Indianapolis, Heartland

Sweeteners was one of 41 companies, from a field of

more than 420 nominees and 100 finalists, to receive

the recognition.

The award, presented by the Indiana Economic

Development Corporation, its Small Business

Development Center network, Purdue University and

the Edward Lowe Foundation, recognizes the state's

privately held businesses that employ up to

150 employees and have between USD 750 000 to 100

mio in annual revenue or capital.

Heartland produces and distributes branded and private

label sweeteners for the food industry. Their branded

products of Ideal(R) and Nevella(R) are great for the

whole family, diabetics and people watching their

calorie intake. Ideal(R) and Nevella(R) are perfect for

baking and are distributed in North America, Europe,

Central and South America. (marketwatch.com

27 August 2010).

EU-China trade row looming over potatoes

The case is the first of its kind and comes as EU

Customs Commissioner Algirdas Šemeta arrives in

Shanghai to put pressure on China to tackle cigarette

smuggling. China fears EU member states are propping

up their potato starch companies in a way that damages

Chinese domestic industries.

The Chinese Ministry of Commerce said it launched a

probe after receiving complaints from the China Starch

Industry Association.Beijing said it would conduct an

investigation in line with World Trade Organisation

(WHO) and domestic rules, and said the process would

be fair and transparent.

If it finds that European governments are conferring an

unfair advantage on its exporters, retaliatory duties

could be slapped on European imports.Commissioner

Šemeta did not plan to discuss the issue during his

discussions with Chinese customs officials this week. A

spokesperson for the Commission's trade directorate

told EurActiv that Beijing has notified Brussels of its

intention to investigate European potato starch

subsidies. He said the Commission notes this is the first

anti-subsidy case China has opened against the EU.

"The Commission will continue to monitor China's

trade defence activity and will consider any adequate

reaction if China would impose measures that do not

comply with the WTO rules. In the meantime, the EU's

bilateral relations with China continue business as

usual," he added. Europe's generally low-key potato

starch industry has found itself in the headlines more

than usual this year, primarily as a result of the

European Commission's decision to allow BASF to

manufacture Amflora – a genetically optimised starch

potato (euractiv.com 2 September 2010)

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These are the news derived from regional

publications, translated using online tools,

hence the medium quality of translation.

Thailand

Bio-gas' capture renewable energy market

PTT Plc will spend about USD 9.9 mio to develop

biogas for vehicles, according to

Permsak Shevawattananon, a senior executive

vice-president of the majority state-owned energy

company. Biogas or methane would be processed from

agricultural waste into gas and could be an alternative

to liquefied petroleum gas (LPG) or natural gas for

vehicles (NGV).

"The idea is aimed at using methane gas for vehicles in

rural areas that are located too far from NGV service

stations," said Mr Permsak. PTT is developing two

methane gas production units with an investment of

USD 6.6 mio on a pig farm in Chiang Mai. Daily

methane output of 6.5t would be equivalent to 6 400

litres per day of diesel.

This project will be built and operated by

Universal Absorbent and Chemicals Co, a local biogas

developer, and partially financed by the

Energy Conservation Fund. Construction of the facility

will start next month and it is expected operations will

get underway by the end of next year.

"Although this is a pilot project, it would be the big

start to developing green fuel from waste and could cut

greenhouse gas and use of fossil fuel," said

Mr Permsak. Another project is in Ubon Ratchathani,

where methane gas will be made from cassava starch

waste. PTT will spend USD 2.6 mio to build the facility

that is expected to start operating by the middle of next

year. Its daily output of 8t would be equivalent to 8 000

litres of diesel. (thailandtapiocastarch.net 28 July 2010)

Delivery Strategy document 2. Focused research costs - increase productivity

Mr Yukon Lim Laemthong, Permanent Secretary,

Ministry of Agriculture, said the Committee prepared a

draft strategy Thai Rice No. 2 in 2011-2015 (in

production) and is providing 62 mio hectares of area for

cultivation of of 30 mio t of paddy rice under three

main strategies.

1. Research and Development: It aims to ensure that

rice production quality is improved by using insect

resistant rice which are resistant to environmental

changes, including the development of rice production

and products, to rely on imports from abroad. This will

reduce costs for farmers in terms of factors of

production.

2. To increase the yield from the present, which is

approximately 405 kg to 679 kg per rai,

(6 rai=1 hectare) the measures undertaken are - an

increase of approximately 10% of farmers would

reduce production costs by at least 15% in 2015; using

strategies in the new system of rice; water use

efficiency; the development, production and

distribution of rice seed varieties and to promote and

enhance rice mill production development.

3. To strengthen the farmers from the Department

of rice, which was targeted to increase

the income of rice farmers.

The Ministry of Commerce strategically targets to

achieve the link between production and marketing

before presenting the National Rice Policy Committee

to consider approval as fast as possible. (oatthailand.org

11 May 2010)

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Thailand's Chia Tai International trade office in China

The Thai government committee has approved the

government stocks of 140 000 MT of cassava starch to

be sold to a Chinese logistics company. This will result

not only in partially meeting the market demand in

China, but also lead to increase in starch prices due to

scarcity of raw materials in other parts of the world.

Currently, in Taiwan and Indonesia and many other

markets, buyers tend to look for alternative products of

starch to reduce the cost of raw materials.

According to the report of the agricultural sector at

present, the destruction of pests degree has reached

7.03 mio hectares, the Thai government has approved

USD 3.6 mio to the Ministry of Agriculture to control

the spread of pests. Thailand's Agriculture Ministry said

in a statement, by the end of 2010-11, cassava root

production is expected to reduce at a rate of 7.16%

from 22.95 to 21.3 mio t. By the end of this year,

cassava products prices is expected to follow a rising

trend.

However, since last year due to increase in farmers

planting costs, the Thai Ministry of Commerce issued a

statement saying that by the end of the year 2010-11, it

would start a new cassava crop root deposit increased

from USD 0.05 to 0.06 per kg. The move is likely to

encourage local farmers to grow cassava.

Meanwhile, dry cassava chip exporters tend to buy

more pieces of cassava dry but the market supply is

inadequate. Plus a few days ago in rainfall in many

parts of Thailand, manufacturing of cassava chip dry

film was not carried out. Therefore, all of the cassava

roots were used directly for processing starch. Although

the supply of cassava roots are starch manufacturer, but

can only meet about 30% of its capacity. So this has

also led to rising prices of cassava starch.

(cncassava.com 10 May 2010)

The starch market gaps, cassava starch is still high Continued strong cash price of cassava starch, Vietnam,

Thailand and increasing production of this crop season

is just rumors. The main producing factory warehouse

delivery invoice price is not maintained at

USD 545 to 552 per t.

According to Thailand World News Deputy Spokesman

of Thai Prime Minister Office reported that the Cabinet

agreed to the official inter-form (G2G) sale of 140kt

flour to a China Lianyungang company, equivalent to

USD 348 per t because of its price increase than other

companies.

Thailand's cabinet agreed to sell 140kt of cassava

starch, cassava starch all this volume will have some

impact on the domestic markets panic. Since last

winter, after a new corn market, domestic corn prices

were found to be higher. Corn ongoing auction, the

auction transaction volume and transaction prices are

rising, fueled the market's bullish sentiment and supply

is tight. Due to import of corn, the domestic corn supply

appears to be affected.

Meanwhile, low spring temperatures, snow and rain

weather, delayed spring sowing, the corn planting and

growth is adversely affected by additional risk premium

for the market. Currently the overall market sentiment

is heavy, but there are still some negative factors in the

market. Firstly, farmers now producing corn in

Northeast stock up the high side; Second, the lack of

bright breeding industry needs, while frozen pork

purchasing and storage policies promulgated by the

state, but still needs time to feed the demand recovery.

Mixed long and short corn market factors, the

short-term market movements have a certain deterrent

effects, but long-term trend will remain up.

(cncassava.com 10 May 2010)

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Malaysia – Indonesia Army buy Thai rice- A commercial mediation success

Foreign Trade Department Deputy Prime Minister

Mr Suwan led trade delegation visit to Thailand,

Indonesia and Malaysia to meet with senior executives

of government and agencies that control the import of

rice. Thailand has shown readiness to be the main

source of imported rice to Indonesia and Malaysia.

"In discussions with Indonesia, Thailand has asked to

consider increasing the quality of imported rice thus

Thai jasmine rice will meet the needs of the consumer

level without affecting the domestic price of rice in

Indonesia. Indonesia has also asked to consider a

Memorandum of Understanding (MOU) of rice from

Thailand to buy a new constitution to create food

security for Indonesia. Thailand also told to negotiate

with the government sale of rice to the government

(G-II G) and Indonesia.

Thai ensures that there is enough rice for Malaysia in

order to meet the current needs of rice as well as to

serve as a source for importing rice to Malaysia in the

long run. Malaysia also agrees that the Thai rice is

better than rice from other countries and is willing to

import Thai rice. (thairicemillers 16 Aug 2010)

Reclamation of agricultural products: cassava starch crop season arrival of the foreign national is up or down? The recent strong rains in Thailand, is very conducive

to the growth of cassava seedlings. In growing areas of

Thailand near Cambodia, this year has not been

seriously affected by pests and drought, and the first

price of cassava in this region has always been cheaper.

This year, the area opened several new plants and is

said that in Cambodia a few small factories has

commenced, with prices around USD 480.

(continued in next column)

Reclamation of agricultural products: cassava starch crop season arrival of the foreign national is up or down? (Contd)

Others say: "In October, the domestic price of cassava

starch is USD 687 per t, as Thailand or even decline in

value will not be very severe. The current situation is

that – USD 580 a small amount of turnover, fell to

USD 550 according to the calculation. In August, the

powder is expected to enter the production season in

October, the domestic crop season for 2 months, prices

will rise again"

Although the short-term supply and demand within the

tension is resolved, but in the long run, regardless of

country, Thailand or Vietnam, there is the trend of

demand for cassava raw materials, particularly cassava

ethanol, fresh cassava or dried cassava will become

more intense rush. Cassava in Guangxi province began

to be postponed to December harvest time around, thus

the overall maintenance of the total acreage as well as

the increase in the cassava growing area of the market

would not be greatly affected due to drought last year.

(fx678.com 17 August 2010)

Brazil/Argentina

Parana farmers complain of corn prices

The quality and yield of corn in Paraná winter may lead

to a productivity record. However, farmers still

complain about the price and feature auctions of PEP to

ensure a better income this year. If last winter the corn

was not well in Parana, on account of frost, this year the

weather has helped. 66% have already been harvested

crops, and quality is assessed as very good. Even with a

smaller area of 10%, the Paraná should close the

harvest of winter maize production with a 41% higher.

The expectation of the Secretary of Agriculture is

around 6.3 mio t.

(continued on next page)

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Parana farmers complain of corn prices (Contd) The difference up is on productivity, which should be

more than 4600 kg per hectare of grain and can be a

record for the state. But even with a vintage quality, the

farmer Odair Faval of Cambé, in the northern state, can

not stay optimistic. He planted 150 hectares, half of the

area in 2009 and calculating the costs, for a price that

currently is between USD 8.07 and 8.19 per bag.

The Cooperatives tend to accompany the forward price

for corn, whereas the farmers receive a minimum price.

At Cooperative Integrated, Londrina, over

6 000 members must deliver 380kt of maize by the end

of the harvest in September. For the commercial

manager of the cooperative, Luiz Yamashita, PEP

auctions are still guaranteed price for the grain. The

government has to determine a price that is good for

both producers and consumers too - evaluates the

business manager of the Cooperative Integrated

Luiz Yamashita. (canalrural.com.br 17 August 2010)

Tereos has lost USD 17 mio

The devaluation of the EUR against the real and falling

prices of starch in Europe had a negative impact on the

outcome of the first quarter of the 2010-11 season in

Tereos International, parent company of

Açúcar Guarani. Even with higher prices of sugar and

ethanol in Brazil, the company, which transferred its

assets this year from France to the country, posted a

loss of USD 17 mio, compared with profit of

USD 44 mio in the same period of 2009.

Andre Trucy, President of Tereos International, said the

sale price of starch in Europe fell 9.2%. Revenues from

ethanol (wheat) in the European bloc was also 18.6%

lower.

(continued in next column)

Tereos has lost USD 17 mio (Contd) From October 1, the company, the third largest

producer of starch in Europe, intends to renegotiate all

contracts for the supply of starch with customers, says

Trucy, due to the high international prices of wheat, a

raw material used for starch and ethanol.

In the Brazilian market, says Reynaldo Benitez,

Director of investor relations for Tereos ―Prices of

sugar and alcohol were higher, but production costs

increased in the order of 30%, mainly on account of the

acquisition costs of cane sugar. Net debt fell by 4%

over the first quarter, to USD 2.2 bio.‖ (udop.com

17 August 2010)

Government guarantees to support the sale of maize Representatives of the Ministries of Agriculture,

Finance and Planning will evaluate today the result of

the program for corn and also review the marketing

policy of the wheat harvest which begins in September.

The federal government's participation in the market of

maize 2009-10 harvest allowed the sale of 10.9 mio t,

with application of USD 416 mio since May when it

began operations auctions Award for

Disposal of Product (PEP) Equalizer and Premium Paid

to Producer (Pepro). For Silvio Farnese, general

coordinator of Grain and Annual Crops Department

of Agriculture, the initiative favored the market that

shows signs of improvement in prices.

At the auction conducted by the National Supply

Company (Conab) on Thursday were trading 95% of

300kt of maize offered in Mato Grosso and Goias, in

the form Pepro. The average value of the prize of

opening was USD 3.1 per bag and the closure of

USD 1.79 per bag. The discount reached 30% in

Missouri and 46% in Mato Grosso. (dci.com.br

23 August 2010)

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Bahia wants to introduce cassava starch in the production of bread and pasta

The Secretary of Agriculture of Bahia, agronomist

Eduardo Salles, defended on August 20, 2010, at the

opening of the Expomandioca National Fair of Cassava

in Santo Antonio de Jesus (BA) to join efforts for the

adoption of a law that requires the introduction of

cassava starch in the manufacture of bread and pasta.

"Studies by experts show that you can add up to 25% of

cassava starch to wheat flour without changing the taste

and without any damage, but if we can add 10% will

have a breakthrough." He considered that this

represents an increase of 2.5 mio t in cassava

production and generating over 50 000 jobs.

According to Joselito Motta, a researcher at Embrapa

Cassava and Tropical Fruits, the cassava starch does not

contain gluten and acts as thinner this wheat

gluten. From an economic standpoint, the use of starch

in the bread will represent a savings of

USD 100 to 200 mio per year.

"Brazil imports 80% of the wheat it consumes, bleeding

our economy about USD 1 bio per year." He recalled

that a project this content proceeded in Congress but

was shelved under pressure from international lobby of

wheat. The Embrapa researcher also noted that the

Board of Aldermen of Petrolina just pass a bill

requiring the use of starch in the bread of the municipal

school feeding, waiting now to endorse the mayor.

The secretary noted that a plant starch and modified

starch is being installed in the town of Lage, Jequiriça

Valley, and another is being implemented in Vitoria da

Conquista. The Seagri studying the possibility of

reactivating a starch factory that for years is disabled in

Feira de Santana. (agrosoft.org.br 23 August 2010)

China

First Shanghai : China starch slightly weaker than expected profit

Medium-term revenue and net profit growth of

39.7% and 45.2% : The Company’s revenue reached

USD 171 mio with a gross profit of USD 22.7 mio.

Profit attributable to shareholders was USD 13.1 mio,

up 45.2%. Sales and administrative expenses during the

period was more than expected, resulting in slightly

weaker than expected performance.

Shouguang company will double the capacity of

government to promote growth plans : Signed an

agreement with Shouguang City, the Government will

provide 400 000 sq.m. of land and other preferential

policies for the development of the company 400kt of

corn starch and 50kt of lysine new projects. Shouguang

add 100kt of corn during the period of starch

technology projects have been invested to open

construction.

Expected gross margin in the second half of corn

starch increased more than 12% : Corn prices rose

25.6% to USD 253 per t. Starch business gross margin

rose significantly to 11.1% as scheduled. Linqing plant

will continue to improve capacity utilization in the

second half gross margin and will continue to enhance

the starch business.

Lysine business in the first half to help control

energy consumption, gross margin was maintained

at 21.3% : Lysine business during the company's

revenues of USD 30.1 mio, up 11.2%, sales of lysine

22kt, down 9.4%, average price USD 1308 per t, up

24.1%.

Maltose projects during the period : 100kt capacity

utilization is only 18.7% : Starch sugar business

during the company USD 2.57 mio in revenue, due to

low capacity utilization led to operating profits and

expected the business situation in the second half of

starch sugar better. (finance.qq.com 24 August 2010)

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Russia

Ukraine is determined by the regime of exports of maize in 2010, closer to its cleaning - Minister of Agrarian Policy

Ukraine until the regime of export quotas of corn,

waiting for a more accurate assessment of its crop to

make a calibrated decision on whether to introduce such

restrictions, said Agriculture Minister Nick

Prisyajnyuk. As reported, the forecast grain harvest in

Ukraine in 2010, reduced from 45-47 to 40-42 mio t,

compared to 46 mio t in 2009. In this harvesting of

early grain crops is nearly completed: their harvest was

about 31 mio t, and now the total yield depends on the

condition of corn.

U.S. Department of Agriculture (USDA) last week

lowered the forecast of the corn crop in Ukraine from

13 to 11.5 mio t, while its exports - from 6 to 5 mio t.

The Ukrainian government to ensure food security

intends to introduce quotas on exports of wheat and

barley in the amount of 2.5 mio t from 1 September

until the end of this year. (apk-inform.com 18 August

2010)

Vietnam

Cassava dishes are bringing large benefits to farmers

Cassava growing area is continuously expanding, while

sugarcane material area shrinking has caused

Quang Phu Road plant (under the Sugar Company of

Quang Ngai) forced to refuge in the Factory Road An

Khe (Gia Lai). In Quang Ngai, cassava dishes are

bringing great benefits to farmers, thereby gradually

shrinking farmland for other crops particularly sugar

cane. This is the reason why cassava growing area has

increased sharply, pushing the area of sugarcane to the

lowest.

(continued in next column)

Cassava dishes are bringing large benefits to farmers (Contd)

Tinh An Tay Commune (Son Tinh District), formerly

known as sugarcane land, but now 2/3 area of

sugarcane cassava has been beaten. Although still two

months away to harvest cassava, but now, residents of

Independence Village (West Indian Tinh commune,

Son Tinh District), have rushed to sell fresh cassava

tubers in the field for traders. Nguyen Thi Hai (live in

communal Pure Indian) said, if last year, fresh cassava

fields can only be sold at USD 20.4 to 25.5 per t, this

year, she sold up to USD 45.9 per t. While the service is

available in the second year, and lower cost of care, not

being forced traders or factory price, the sugarcane

production was 1 case per year but only

700 000 to 750 000 price per t.

Due to profit from cassava bring twice as sugar cane, so

the farmers have rushed in as cassava and sugar mills

have to refuge, the cassava processing plant each day a

swollen. Tuan Le Toan, deputy director of Joint-Stock

Company of Quang Ngai Agriculture, said the company

has 5 factories processing cassava flour, that is not

including a plant biofuels made from cassava is being

built in Quang Ngai province.

However, the 2009-2010 crop year, the situation has not

improved, when the province of sugarcane area to just

over 4800 hectares, down nearly 300 hectares and the

output of nearly 179kt of raw materials (86.8% reach).

According to the report of the Deputy Factory Road

(Sugar Company of Quang Ngai), since the year

2010-2011, Quang Phu Road plant will stop production

and relocate equipment and workshops to An Khe

Sugar Plant (Gia Lai) by Resolution of the shareholders

to move down the plant material into Quang Phu Street

to the Deputy to ensure that service sugar cane juice, as

well as to exploit the maximum capacity of the plant,

avoid having to stop production before the current

2-3 months.

(continued on next page)

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Starch Italics Regional Language News Starch Industry Overview

Aug/Sep 2010 © GIRACT 2010 P a g e 2 6

Cassava dishes are bringing large benefits to farmers (Contd)

Accordingly, from the 2010-2011 crop year, the

purchase of sugarcane by the sugar mills will take

whole Prussia Feng. Besides, will increase the capacity

of An Khe Sugar Plant from the transplant the

production line of Quang Phu Road plant and will be

completed in late 2011.

That was the plan, but said Cao Minh Tuan, Vice

Director of Quang Ngai Sugar Joint Stock Company,

the factory stopped production in Quang Phu Street one

year period will cause economic damage to the

Corporation Quang Ngai Sugar, as well as the revenue

budget for Quang Ngai province. Furthermore, the

production will entail stopping problem, because to

solve employment for hundreds of employees. (cafef.vn

18 August 2010)

Song Dinh cassava starch factory : Striving to produce 29kt of cassava starch in the 2010-2011 crop

Song Dinh company is planning to use 7 500 hectares

cassava as raw materials ensuring for processing plant

with cassava operating design capacity of 150 t per day

in new production of this crop. It is known that in the

year 2009-2010, the company produced 26 866 t of

cassava starch export to create jobs for nearly

150 workers at the plant with 2.9 mio average income

per person per month, contributions to local budgets

10 bio.

Tay Ninh cassava price increases, large grower interest The prices of fresh cassava in Tay Ninh province has

risen to USD 0.13 per kg. The current price level was

higher than 2009 when it was USD 0.02 per kg.

Accoring to the farmers, fresh cassava price is higher

then ever before. With this price, this year many

farmers planted cassava and cassava companies

purchased large harvest from Tay Ninh. With the

current price, each hectare of cassava harvested

immature, cassava growers still have about 30 mio

profit. For true for cassava harvest, growers can profit

to USD 4080 per hectare.

As cassava processing enterprises shall be made by

wheat, flour market in the world have large demand for

cassava starch, while flour production tend to reduce

flour prices have increased continuously. This year, the

raw materials area of Tay Ninh province is not much

higher than the service area of cassava in 2009.

However, lower pulp yields by farmers and businesses

at taking advantage of high prices of fresh cassava

harvested immature, so the average yield per hectare of

cassava was reduced, even reaching over

20 t per hectare. Harvesting cassava garden will

produce raw materials which will have lower starch

content of cassava grown.