The company believes that its €7 million investment will help it to meet increasing demand for the emulsifier, and consolidate its position in this fiercely competitive market place.
The expansion will enable Palsgaard to produce more than 30,000 tons per year, and will be completed by autumn 2006.
Recent figures from Frost & Sullivan reveal emulsifiers, along with fat replacers, are leading growth in the food additive industry: since 2001 the market value of emulsifiers rose by some 5.6 per cent. Emulsifiers are used by food makers to reduce the surface tension between two immiscible phases at their interface - such as two liquids, a liquid and a gas, or a liquid and a solid - allowing them to mix.
The market for emulsifiers is also growing well and enjoying growth from increased industrialisation in geographical zones undergoing a change in economic dynamics.
China is the notable example, where growth in the Gross Domestic Product (GDP) in July 2004 grew 8.4 per cent year over year, compared to the UK for instance that saw GDP grow by just 3.2 per cent year, or France by 2.4 per cent, shows a recent report from investment bank Goldman Sachs.
The expansion will therefore hopefully enable Palsgaard to tap these growing opportunities.
The expansion is part of a continuous plan to develop the Palsgaard speciality emulsifier and stabilizer product programme and follows the recent €10 million investment in a brand new spray-cooling tower, built for the production of integrated blends for improvement of ice cream products in particular.
This investment has enabled Palsgaard to expand not only the production capacity but also the range of monodiglycerides and distilled monoglycerides based on hydrogenated and non-hydrogenated oils and fats.
The firm also recently introduced a new emulsifier-stabiliser system for chilled, quark-based aerated desserts. Propelled by consumer health concerns, food makers are under pressure to design tasty foodstuffs that cut back on the fat.
On doses of between 2 and 2.3 per cent, the system is composed of beef gelatin, modified starch, mono- and di-glycerides, and sodium citrate. For Europe, labelling of the new system that "maintains organoleptic characteristics similar to those of a standard high fat version" requires E1422, E471 and E331.