The new factory, opened in Zierikzee, Holland, will specialise in producing the flavour neutral PGPR emulsifiers used to control flow properties in liquid chocolate masses.
"We now have worldwide approval for the PGPR products which has significantly opened up the market for us by allowing chocolate makers globally to use the PGPR emulsifier," Hans Wikman, product manager at Palsgaard told FoodNavigator.com.
Even though we had customers in the EU, they were unable to use the ingredient if they were exporting to the US, because there was no approval for our product, he added.
While approval has boosted sales, Palsgaard claimed that the ongoing interest from chocolate manufacturers to cut costs through reducing the quantity of cocoa butter has also swung in its favour.
The price of cocoa butter is linked to the volatile cost of cocoa beans that are intimately tied to the political climate and weather conditions in the principal growing regions in West Africa, that accounts for 70 per cent of the world's output of cocoa beans.
Cost cuts in chocolate and coating recipes can be achieved through the PGPR, according to the Danish firm, by controlling the flow properties in liquid chocolate masses and reducing the consumption of cocoa butter.
"Enrobing of bars and various bakery products is another typical application area for PGPR, where the cake manufacturer adjusts the desired thickness of the chocolate layer," said the firm.
Emulsifiers - substances which reduce the surface tension between two immiscible (non-mixing) phases - are used extensively by the food industry as a whole, in areas such as bakery products, salad dressings, coffee whitener.
While they are all based on vegetable oils - rape seed and palm oil for the most part - the PGPR formulation uses castor oil for its 'very specific composition qualities'. Castor oil is obtained from the seeds of the Castor plant, Ricinus Communis.
The seeds contain 45-50 per cent castor oil which is 'special' because of its high content of the hydroxy acid, ricinoleic acid. This fatty acid normally accounts for 85-95 per cent of the castor oil. Castor oil is one of the most expensive vegetable oils and is mainly grown in Brazil and India.
The price of PGPR is mainly driven by castor oil and worldwide market prices for this oil are currently rising. On the flip side, prices are balanced by the second key raw material in the formulation, glycerol.
"Prices in the glycerol market have been very low for some time," added Wikman. According to the product manager, the low prices are linked to the considerable rise in biodiesel production in Europe, of which glycerol is a by-product from splitting the fatty acids out of the rape seed.
The new plant in Holland joins other plant facilities in Singapore, Denmark and Mexico.