Palsgaard CEO: From sustainability to better-for-you demands, emulsifier market offers remedies

28 Aug 2019 --- In the midst of a mammoth global climate debate, inventor of the modern plant-based emulsifier Palsgaard has cemented its position as an “early mover” on the carbon production front. All of Palsgaard’s emulsifier and stabilizer solutions are now produced in CO2-neutral factories. Now, six global production sites are now all CO2-neutral, mainly through a shift in energy sources, and the company now plans to ramp up production to double its current capacity. FoodIngredientsFirst speaks to CEO Jakob Thøisen on the company’s achievement as well as his forecasts for the emulsifier market as a whole.

The notion of how big business, particularly those in the food and ingredients industries, will contribute to the fight against climate change is one of the key issues being debated after a leading body of experts, the Intergovernmental Panel on Climate Change (IPCC), issued stark warnings last October. Its study claimed that a rise of more than 1.5°C is risking the planet’s livability and this could be exceeded by 2030 unless drastic steps are taken now.

Visible corporate social responsibility (CSR) achievements are increasingly important to companies operating across industries. A 2018 Innova Market Insights survey found that 64 percent of US and UK consumers expect companies to invest in sustainability. The survey found that consumers’ environmental concerns outweigh social and ethical ones when considering the brands that they buy. This market dynamic has inspired product development, with 57 percent average annual growth reported in food & beverage launches with an ethical/environmental claim (Global, 2013-2017).

CEO Jakob Thøisen.Palsgaard has cemented its position as an “early mover” on the carbon production front. How did you achieve CO2-neutral production ahead of schedule?
The production of emulsifiers is very energy-intensive and when we decided to eliminate our carbon footprint, many thought it couldn’t be done. However, we’ve demonstrated that with ambition and innovation, sustainable ingredient production is possible. Achieving CO2-neutral status ahead of schedule has given us extra energy to continue making a difference.

We started in 2005 by constructing a straw fire burner at our Juelsminde, Denmark location. Following this, we installed LED lighting sensors and heat exchangers, as well as further insulating the factory. This has taken us a fair part of the way. Also, we initially changed our heavy fuel to natural gas and then the natural gas to biogas, as well as buying green windmill energy and hydro energy. 

You have achieved carbon neutrality at six plants. But surely there was a variation between your global locations so, how did you approach this?
We first achieved it at our Denmark plant, which is by far our biggest. This was soon followed by the Netherlands and Mexico, where we covered nearly all our electricity consumption through solar panels and purchasing biogas. 

But at our factory in Malaysia, we had to look for different opportunities. We found that we could not achieve it right away, so we had to buy offsets. Offsetting is a climate action that enables individuals and organizations to compensate for the emissions they cannot avoid, by supporting worthy projects that reduce emissions somewhere else. The greenhouse gas emissions reduced through offsetting are measured in UN Certified Emission Reductions (CERs).

Palsgaard has also publicized its ambition to double its production capacity while retaining its CO2 neutral status. How much of a challenge will this be?
Yes, this is a big challenge, especially as we already produce a lot of products. Our plan to double capacity will mean us applying a lot of electricity and biogas. We are also looking into making a large solar paneled plant near our factory in Juelsminde, Denmark, which will keep us CO2 neutral even when we achieve double production. 

Regarding your emulsifier portfolio, what changes have you made in the last two years to make it more attractive in a sustainable sense?Many of its lines are both also plant-based and free-from allergens, further appealing to consumers with specific dietary needs.
Aside from offering a portfolio of CO2 neutral emulsifiers, over the last few years we have started buying segregated – SG – palm oil from the Roundtable on Sustainable Palm Oil (RSPO).

Can you share some of your forecasts for the future of the emulsifier market, aside from sustainability demands?
“Better-for-you” is is a global trend right now. Each individual consumer is very concerned about what is good for them and emulsifiers can play a large role in this. Our products can both reduce fat and calorie intake.

Our lines are both also plant-based and free-from allergens, further appealing to consumers with specific dietary needs. However, I can’t divulge how much of our R&D budget we invest into this space, but we are sure that it is a trend that will continue to grow.

In some parts of the world, such as India and China, about one billion people over the next 30 years will move from low- to middle-income ranges. When this happens, a shift often occurs towards buying prepared foods from supermarkets. Many factors play into this shift, such as women entering the workforce, so the demand for food in which emulsifiers play a role in will rise.

At time a time when everyone is going clean label, how do you remain on the label?
The world’s population is growing by 87 million new inhabitants every year. So, emulsifiers have a place and they need to stay. They are needed for reducing food waste and ensuring all the population has access to food.

A full-length version of this interview can be read in the September edition of The World of Food Ingredients.

By Laxmi Haigh