CP Kelco raises prices across product range

By Lorraine Heller

- Last updated on GMT

Related tags Cp kelco E number

Hydrocolloid firm CP Kelco is the latest ingredients firm to pass
rising costs onto the market, announcing yesterday that it is to
raise prices across all of its product ranges.

The increases, of up to 8 percent, will affect the company's carrageenan, carboxymethyl cellulose (CMC), gellan gum, pectin and xanthan gum products.

"Following a series of aggressive campaigns to reduce our costs, which include streamlining our production assets, we continue to see sustainable increases in critical raw materials, energy and freight costs that negatively effect our operating margins,"​ said Rick Calk, vice president of commercial operations at CP Kelco.

The firm, a leading US-based supplier of pectin and xanthan gum, said the changes will be effective as of December 1 2006, or as existing contracts expire.

Prices for CMC products will be raised by 5-8 percent across all market segments. Pectin and refined carrageenan will be raised up to 8 percent across all markets. Biogums (xanthan gum, gellan gum, welan gum and diutan) will be raised between 3-5 percent across all market segments.

CP Kelco is the latest in a list of firms turning to price hikes as they are increasingly squeezed by higher energy and raw materials costs.

Last month, competing hydrocolloid firm FMC Biopolymer said it would implement 5-10 percent price hikes across the full range of its primary products, including carrageenan, microcrystalline cellulose and alginates. The Philadelphia-based firm said prices for hydrocolloid blends such as konjac flour and locust bean gum are also expected to see similar rises.

BASF, Novozymes, Cargill National Starch and DSM are just some of the other ingredients companies that have also announced price increases in recent months. These affect a wide range of products, including starches, citric acid, vitamins and enzymes.

December's price increases by CP Kelco follow previous increases implemented in November last year, across its biogum, carrageenan and cellulose gum range. These ranged from 4- 10 percent.

According to Calk, the firm's latest raises will allow it to "continue a serious focus on new technology development."

As part of its ongoing moves in the hydrocolloids industry the company recently announced increased investments into China for a new CMC facility and increased capacity from its biogums facility.

"These investments, coupled with continuous improvement projects in our pectin and carrageenan businesses, ensure both our product offering and infrastructure are in place for a sustainable long-term growth,"​ said Calk.

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