The company said that there are several specific economic problems facing food manufacturers, including a global producer price index set to rise 4.7 percent in 2010 and predicted to rise at an average rate of 2.7 percent during 2011, meaning that the price of soybeans is likely to rise. In addition, the company said that the producer price index could rise by as much as eight to ten percent in some regions.
Solae’s CEO Torkel Rhenman said in a statement: “Solae is not immune to these economic pressures, and this new pricing is critical to our business and our ability to serve our customers. Solae continues to be in a great position to help customers through these challenges by providing innovative, economical solutions. We are committed to providing high quality, predictable soy ingredients while continuing to invest for future innovation to meet our customers’ needs.”
The company, which provides both genetically modified (GM) and non-GM soy ingredients, also said that continued improvements in biotechnology to boost soybean yields are impacting on its non-GM soy ingredients. As acreage devoted to non-GM soy decreases, price premiums necessarily increase, it said.
Solae said that although it has been able to absorb much of the current inflationary pressure, “price increases are unavoidable” considering current outlooks.
However, the company said earlier this year that interest in sustainable soy has boosted growth for the soybean industry, and it expects further interest in soy-based ingredients.
In terms of environmental impact, soy is thought to be a more carbon efficient protein than beef and dairy production, using less water and energy, for example. The company has said that soy can produce ten times more protein per acre than beef, and five times more than dairy.