Food industry challenged by buyers’ choices

Food industry challenged by buyers’ choices

6:19 AM, 9th November 2016
R S Jalan, Managing Director, Gujarat Heavy Chemicals Limited, (GHCL).
R S Jalan, Managing Director, Gujarat Heavy Chemicals Limited, (GHCL).

In an interview R S Jalan, Managing Director, Gujarat Heavy Chemicals Limited, (GHCL) with Chemical Today magazine opens up on the changing trends in the food industry. He also delves into the growth potential that the sodium bicarbonate industry has in the near future.

By Shivani Mody

Global trends in the sodium bicarbonate industry.

The global demand in the sodium bicarbonate industry is said to be growing by 4 to 4.5 percent on year on year basis. The target segment for such kind of a product is the food industry, alkaline mining industry, dairy/cattle feed industry, which provides a good opportunity for the consumption of the product in the global market.

Impact of soda ash market on the sodium bicarbonate industry.

Soda Ash is a major raw material used in the manufacturing of sodium bicarbonate and hence the pricing of soda ash does influence the pricing of sodium bicarbonate. However, the market size of sodium bicarbonate is very small in terms of the global capacity consumption, which stands at 2.5 million MT per annum as against the installed soda ash capacity of 67 million MT per annum. Hence we may say that the correlation is very limited.

Growth potential for sodium bicarbonate in emerging markets.

Sodium bicarbonate is primarily used in the food industry and also in other segments like poultry and chemicals. With the economy targeting a growth of 7-8 percent in coming times, all these segments are expected to witness growth as well. GHCL specializes in manufacturing food grade of sodium bicarbonate. Our sodium bicarbonate finds application in many industries including pharmaceutical and food additive industries. Procter & Gamble is one among some of our notable clients.

Potential for food additives and animal feed industry in emerging markets.

In emerging markets, food and animal feed industry are showing good growth prospects for the food additives category. The key market drivers for the growth of food and feed additives industries include: increase in the consumption of bakery products, change in food habits and also growth in the poultry segment.

Challenges faced by the food additives industry.

The challenges faced by the food industry are growing with the increasing number of alternatives available to consumers. Hence the consumer has more choices, bringing down the loyalty factor for the bakery products. Thus, wafers/namkeen are giving tough competition to the bakery products.

GHCL’s food additives business & activities.

We have a current sodium bicarbonate capacity of 30,000 MTS per annum which is planned to be enhanced to 60,000 MTS per annum by next year end. However, a significant majority of our production (almost 75 percent by volume) is technical grade and only 25 percent is food grade. We are looking to expand our reach within food grade segment to improve our market share.

Focus on sustainability in the food additives business.

Our major interest is in the field of soda ash where our installed capacity is 8.5 Lac MT per annum which is being enhanced to 9.5 lac MT per annum by the end of the current financial year. In contrast to that, the capacity of our sodium bicarbonate production, which is a co-product, is 30,000 MTS per annum and we have planned to enhance it to 60,000 MTS per annum by next year end.

Our sustainability efforts are focused on soda ash where we are working on sustainable reserves of our raw materials i.e. limestone, salt and lignite etc. Soda ash being a key raw material for sodium bicarbonate production, the efforts deployed will bring positive results herein as well.

© Chemical Today Magazine

See the Interview Coverage in Chemical Today magazine (Pg 20)

View the interview on Mobile, download the Chemical Today magazine app 



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