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Ajinomoto announces MSG price rise on strong demand

By Caroline Scott-Thomas , 29-Jul-2010

Ajinomoto Food Ingredients has said that it will increase the price of its monosodium glutamate (MSG) due to strong global demand and higher raw ingredient and energy costs.

MSG is a commonly used flavor enhancer in a range of packaged foods, particularly sauces, broths, seasonings, stocks, dressings and dried prepared foods. Ajinomoto is a major global supplier of the ingredient, claiming to serve about one third of the market. Market analysts at BCC Research estimate the global market size for MSG at about 2.1 million metric tonnes.

Ajinomoto said on Thursday that it will increase the price of MSG from August 1, 2010, with prices for non-contracted customers to increase by $100 per metric tonne.

President Brendan Naulty said in a letter to customers that “the move came as a result of strong global demand for MSG and recent upward raw material and energy costs.” The use of the ingredient, popular in many Asian cuisines, looks set to increase its presence in the west.

The company said that prices have been under increased pressure partly due to rising interest in umami – one of five taste sensations known to be detectable by humans. But it has also gained attention as a possible substitute for salt, as MSG intensifies and enhances flavor without having a taste of its own, and also has the properties to act as a nutrient – and as food manufacturers have ramped up their efforts to reduce salt in their products, MSG supply has been under added pressure.

Ajinomoto said that the market for umami seasonings in general is growing at about four percent per annum and that the company has seen growing demand from Brazil and Vietnam in recent years, prompting it to increase investment in these regions.

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