Weather and increased demand are putting pressure on prices
International Protein-isolate makers are struggling to fulfil their orders and maximise plant capacities as the global milk supply is exhausted. Poor weather conditions for dairy have reduced output in the US, Europe, Australia and New Zealand, as well as surging demand for animal proteins in places such as China and India.
But Danish dairy giant Arla said the milk crisis had peaked in the latter part of 2007, and that supply was returning to 'regular' levels as more dairies came on board, lured by healthy prices, and as weather conditions stabilised and Asian markets developed their own supply channels.
"The shortage has affected our business and we have had to ration orders and give priority to preferred customers,? said Arla media-relations co-ordinator Theis Broegger. "Our ingredients business has been affected, but we have reserved milk for it because it is high value. We have also had to significantly increase the cost of many of our ingredients as input prices have gone up some 30 per cent. It has certainly been a good time for farmers.?
French milk protein-isolate supplier, Ingredia, which has sales in excess of $100 million, cannot get enough milk for its French operation, and is trying to shore up new deals with French dairies, and looking abroad for partnerships with protein-fraction suppliers and dairies to rectify the situation and meet its international expansion plans.
"Things are moving, but they are moving slowly,? Ingredia's director of international affairs, Dominique Filbien, told Fi. "We hope to have signed some new deals by year's end. We are also close to signing some deals in other countries that will increase our capacity significantly.?