23 May 2013 10:53 [Source: ICIS news]
SINGAPORE (ICIS)--Southeast Asian sorbitol producers are grappling with increasing cost pressure because of rising feedstock tapioca starch prices.
Export prices of feedstock tapioca starch listed by the Thai Tapioca Starch Association (TTSA) were at $515/tonne (€402/tonne) FOB (free on board) Bangkok for the week ended 21 May, representing an 8% increase since April.
An Indonesian sorbitol producer said the increase in tapioca prices sourced out of Thailand has resulted in squeezed margins, adding that they may have to reduce sales volume if they are unable to pass on the cost increase to customers.
The producer is currently offering cargoes at $670-680/tonne FOB Indonesia.
However, market observers noted that any price hikes would be difficult to materialise given stiff competition from other Asian producers that are not reliant on tapioca.
For instance, Indian suppliers that use maize as feedstock are currently offering sorbitol export cargoes at around $600/tonne FOB India.
Sorbitol is an artificial sweetener with applications in food products and pharmaceuticals.
($1 = €0.78)
For the latest chemical news, data and analysis that directly impacts your business sign up for a free trial to ICIS news - the breaking online news service for the global chemical industry.
Get the facts and analysis behind the headlines from our market leading weekly magazine: sign up to a free trial to ICIS Chemical Business.
|ICIS news FREE TRIAL|
|Get access to breaking chemical news as it happens.|
|ICIS Global Petrochemical Index (IPEX)|
|ICIS Global Petrochemical Index (IPEX). Download the free tabular data and a chart of the historical index|
Asian Chemical Connections