OUTLOOK '12: Sorbitol prices expected to jump 12%

05 January 2012 20:37  [Source: ICIS news]

By Frank Zaworski

HOUSTON (ICIS)--US sorbitol prices are expected to increase by about 12% in 2012 as higher feedstock corn prices and increased demand from the food sector push market rates higher.

Annual sorbitol contracts, typically settled by buyers and sellers in the US during November and December, are forecast to increase by about 12% for liquid material, while lesser-used crystal sorbitol prices are expected to increase by about 5%, industry sources said.

Liquid sorbitol prices are forecast to rise to a range of 36.75-41.50 cents/lb ($810-915/tonne, €624/tonne-704/tonne) for 2012, up from a range of 32.78-37.09 cents/lb in 2011.

The bulk of the 4-cent/lb liquid sorbitol price increase (about 2.5 cents/lb) is attributed by industry sources to the higher costs of feedstock corn compared with corn prices a year ago.

Sorbitol is commercially produced by the hydrogenation of glucose from the starch in the corn kernel.

The remaining 1.5 cents/lb of the increase is attributed to higher overall costs of food ingredients in general and sugar-replacing sweeteners in particular.

Crystal sorbitol, used mainly in pharmaceutical and other specialised applications, is forecast to increase by about 5% from a range of 89.13-98.33 cents/lb in 2011 to 93.50-103.25 cents/lb in 2012.

Sorbitol volumes are forecast to increase by about 2% in 2012 from 2011 as the product's use traditionally increases or decreases on par with annual changes in the US gross domestic product.

US producers of sorbitol are Archer Daniels Midland, Corn Products International and Roquette America.

($1 = €0.77)

By: Frank Zaworski
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