Degussa forecasts non-GM lecithin shortage
The percentage of GMO soy being grown in Brazil has continuously increased in the last couple of years. Whilst in the beginning they where only found occasionally in the south of Brazil, today one can find them all over the country.
The Business Line Texturant Systems of Degussa Food Ingredients forecasts major problems coming up particularly for the European Food Industry with regards to availability of non GMO lecithins, due to Brazil’s approval of GM soy. Lecithins play a major role as food additives (emulsifier and dispersing aid) in applications like baked goods, chocolate, margarines and spreads, instant products and convenience food, but are also used under physiological aspects as e.g. dietary supplements.
Degussa writes that with the new legislation on the labeling and traceability requirements for genetically modified food and feed, which came into force in April 2004 (1829/2003 and 1830/2003), nearly all European Food Manufacturers had decided to exclusively use ingredients with guaranteed non-GM origin in order to avoid the necessity to put a GMO claim on their labels.
With regards to soy lecithins, the predominant source for such guaranteed non-GM qualities is Brazil, as the growth of GMO soy was officially banned in the past.
In the meantime however, this situation has changed. In March 2005 President Lula da Silva has officially approved GMO soy in Brazil. Already since March 2003 the Brazilian Government through a number of consecutive so-called “Provisional Measures” had at least tolerated the growth of GMO soy and accepted the respective harvests to be sold for export. As a result, the percentage of GMO soy being grown in Brazil had continuously increased. Whilst in the beginning they where only found occasionally in the south of Brazil, today one can find them all over the country.
The level of “contamination” is estimated to be up to 35 % in the 2005 season vs. ~ 28 % in some regions in 2004 and ~ 10 % in 2003.
This development already today results in more and more problems to maintain established Identity Preservation (IP) Programs. Not only that the risk of contaminations (which is a must to be excluded from the entire value chain) is significantly increasing, but also the question of sufficient quantities being available in general is coming up now.
In addition, the Brazilian Soy Crushing Industry (the origin of lecithins) has got under economical pressure throughout the last years, which has recently led to the closure of several oil mills that had been participating in IP systems in the past. So the number of reliable producers of non-GM soy derivates has declined.
Taking all these aspects into consideration, a shortage of non-GM lecithins is likely not only by 2006 but already towards the second half of 2005. This is also reflected by the fact that the oil mills, as the prime producers of crude lecithin, have in the meantime more than doubled their prices for crude lecithin compared to mid 2004.
In an early anticipation of this development, Degussa Food Ingredients through their proximity to and permanent contacts with key players in the Brazilian Crushing Industry, have secured decent volumes for their Non-GM lecithin business.
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