The last few weeks have brought much turmoil to the industry, including the plant-based sector. The explosion of the Nord Stream 1&2 pipelines has blocked any hopes Europe had of obtaining gas supplies via this route for the near future. The massive damage caused by these explosions will prevent any gas flow until it is repaired, which will likely take a minimum of 6 months.
Significant price increases were observed for almost all products in the last quarter. There is no shortage of buyers willing to sign contracts for the whole of next year, but it is hard to find producers willing to do so. In addition, most producers are not currently offering for any period at all. One of the reasons for this is the fear that consumer interest in select products, such as snack, treats, and not basic food items is waning significantly, so they are unwilling to declare purchases for the long term. It is hardly surprising as all future forecasts indicate that consumers will limit their spending on non-essential nutrition, forgo less important items and choose cheaper substitute products.
Rising energy costs and feed prices remain a heavy burden for European meat producers. The development of feed prices in the coming months is eagerly awaited. The situation is also difficult for consumers. Many Europeans may face a cruel choice: heat their homes or feed their children, we know which one they will choose.
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Corn Gluten Meal
We are seeing increasing interest in the product from buyers in the Middle East and Asia. In recent years, many fish farmers have started feeding their fish Vital Wheat Gluten, but due to the high price, have switched to using Corn Gluten Meal, which contains a similar amount of amino acids and protein as conventional fish meal . As a result, there has been an apparent increase in interest in this product by animal feed manufacturers.
The summer drought has resulted in an unsatisfactory corn crop, which could lead to a price increase in the short term. There is no doubt that it is worth signing contracts now as the prices are relatively low. There are rumors that some fish farmers are buying the product directly from Ukrainian producers. On this occasion, it is worth remembering that it is necessary to do business only with trusted partners which eliminates the risk of mycotoxins in the product.
Potato Protein
The potato crop in Poland and Germany has been in poor condition recently. We receive many inquiries about this product, but only a few producers are ready to provide a quote. Some of the potential buyers are holding back on transactions for now, waiting for good quantity and a satisfactory price. In this situation, it is wisest to buy now, because the current situation indicates that prices will become extremely high in the short term. We expect a huge move higher in January in the price of Potato Protein
A big question mark is the changes in the Potato Starch market that will occur in the near future. About six months ago, many paper manufacturers switched to Potato Starch because of the lower price and lighter color. The question is what they will do in light of the recent poor potato harvest.
Vital Wheat Gluten
The situation on the market for Vital Wheat Gluten is somewhat reminiscent of the Potato Protein. Buyers are hesitant to do business with this product at current prices as well. There are many inquiries, and a significant number of them are for Q4, Q1, and even all of 2023. There is a shortage of manufacturers willing to do such business.
A new Vital Wheat Gluten plant in Kansas recently began construction , but probably will not get into serious play until late next year. Similarly, several new plants in Europe have already planned new expansion , but probably will not come to the market until the middle of next year, when the quality of the production has stabilized.
Demand for Wheat Starch is expected to increase significantly as Paper Industry is forced to move from Potato Starch, back to Wheat Starch. Q4 should show increased demand from them. As inventories continue to shrink.
Hydrolyzed Wheat Gluten
The market for this product is rather quiet right now. The demand has slightly decreased. At the same time, it can be observed that buyers of feed grade have started to turn to food grade, as it is difficult to find a supplier.
There are many indications that in the coming months we will see a decline in demand for food grade purchased by amateur athletes, which will undoubtedly affect the price of the raw material itself. It is also expected that some manufacturers of calf milk replacers will switch from Hydrolyzed Wheat Gluten to Soy Flour, which is competitive in terms of price.
Dextrose
Recently, there have been many inquiries about food grade Dextrose, but fewer inquiries about feed grade. We will certainly keep a close eye on the market developments that will determine the coming months. Demand very high for all sugar and sweetener products.
Soy flour NON – GMO
Demand is noticeable, especially from calf milk replacer producers and pig feed producers. As for price forecasts, we expect them to increase in the near future. Producers expected Ukrainian soybean prices to fall in Q4, but that did not happen. Moreover, it is now higher than anyone expected, which automatically leads to an increase in soymeal prices. In addition, it is also not easy to find a suitable substitute.
