Breaking News on Food & Beverage Development - EuropeUS edition | Asian edition

Headlines > Market Trends

Price increases provide new marketing opportunities

By Laura Crowley , 19-Aug-2008

AB Enzymes has adapted the focus of its baking enzymes range to focus on how they provide solutions to the rising raw material costs that dog the baking industry.

Changes in industry conditions and challenges, coupled with emerging trends, can open up opportunities for manufacturers to breathe new life into old ingredients.

Although the marketing of innovative ingredients can be a costly and difficult process, there is the advantage of stirring interest in something new. Meanwhile, manufacturers of well-established ingredients have the challenge of maintaining interest.

To do this, many are seizing on shifting climates in the industry to pick a timely moment for singing the praises of old products. And for the bakery industry, one of the main preoccupations is in combating rising raw material prices.

Germany-based AB enzymes first launched its Veron GMS (Glycerol-Mono-Stearate) as part of the Veron range in 2006 to replace between 50 and 100 per cent of the emulsifier monoglyceride.

It is now emphasising how this enzyme can save up to 30 per cent of production costs.

Monoglycerides are used in a wide variety of yeast-raised baking applications, apart from crusty types of bread with a short shelf life. They form a complex with the amylase part of starch, thereby providing a soft, moist crumb and improving the initial softness for the first few days after baking.

They are mostly used together with anti-staling amylases for achieving a longer shelf life and keeping the texture fresh, Oscar Diez, sales development manager for baking enzymes, told BakeryandSnacks.com.

While monoglycerides have not suffered from price increases, cost savings achieved by replacing the enzymes with a cheaper alternative can compensate for increasing costs elsewhere, according to Diez.

Diez said: “AB Enzymes have been working for over 50 years on these products. The first product was intended to replace enzyme active malt flour and thus already intended to save the users cost on top of giving technological benefits.”

Off-setting price increases

Commodity costs have been impacted by double-digit rises in the past couple of years, as a result of poor harvests, rising populations and competition from emerging markets, grains being diverted for use in biofuels, and high energy costs that saw oil top $145 a barrel last month.

The World Bank estimated prices of wheat, rice and maize in developing countries increased $324bn (€207bn) last year alone.

Grain mills, ingredients manufacturers and commercial bakers are all facing the challenge of dealing with the cost increases so as not to suffer a dip in their profit margins.

“Our work is very closely aligned with our customers' needs,” said Gerald Jungschaffer, business unit manager for baking enzymes. "That is why we can develop custom-made solutions that provide progress, best baking results and a higher profitability for our customers."

The current Vernon range comprises 35 products. Other ingredients recently introduced by AB Enzymes to save costs include Veron HF, which is used to replace 50 per cent of the gluten used in a formulation.

 

In spring of this year, the group launched Veron S50 to replace Sodium Metabisulphite and improve the properties of the dough. The company claims it reduces the extension resistance, optimises the properties of baked biscuits and crackers and enables the biscuit and cracker industry to process commercially available flours.

Growing use of enzynes

Enzymes are commonly used in the baking industry, as they can improve the quality of the product, for example by creating a more consistent dough quality and texture, or lengthening the shelf life of the final product.

They are being used more and more worldwide in the food and beverage processing applications and are expected to rise by 8 per cent each year to reach $1.2bn (€846.2m) by 2011, according to the World Enzymes report by The Freedonia Group.

Novozyme currently holds 26 per cent of the total enzyme market, while Danisco, Genzyme, Roche, Allergen, DSM and BASF have a 36 per cent share between them, the Freedonia Group said.

Related products

On demand Supplier Webinars

Colouring Foods: Market trends and technical challenges
DIANA, FOOD DIVISION
All supplier webinars