Sucralose keeps profits sweet for Tate & Lyle

By Jane Byrne

- Last updated on GMT

Related tags: Sucralose, Starch, Acid, Tate & lyle

UK food group Tate & Lyle anticipates a year of profitable growth based on strong performance for its sucralose ingredient.

The London-based ingredients supplier released a trading update for the six months ending 30 September 2011 ahead of the release of its half year results on 3 November.

Its sugar substitute sucralose, notes Tate, saw strong volume growth, though at lower average selling prices. And it expects that there will be an easing of volumes to a more normal level in the second half of the year, as the high demand was caused by new product launches.

In May, the company announced it was planning to re-start production at its mothballed sucralose plant in the US, citing hot demand for the sweetener meant it needed more capacity from two global sites.

The sweetener giant put a pause on production at its site in McIntosh, Alabama, in May 2009, to concentrate production at its new, state-of-the-art facility in Singapore. The reason was given as a “breakthrough in sucralose manufacturing yields​”. Over the previous year its facilities had seen yield improvements of 25 per cent, helped by the advent of more efficient fourth generation technology.

The UK group said that in Europe the anticipated squeeze in sweetener margins from higher corn prices has been partially offset by higher volumes.

"Industrial starch volumes in both the Americas and Europe are broadly in line with the prior year although we have improved margins in Europe against a market backdrop of higher demand for corn starches,”​ it added.

The supplier said it expects citric acid sales to be somewhat lower in the first half than the prior year as a result of a more competitive environment, particularly in Latin America.

The ingredients group concluded that its expectations for the full year remain unchanged.

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