Corn, Modified & Clean Label Starches
The starch processing industry has transformed into a bioprocessing industry to meet the demands of a multitude of market segments, such as food, industrial, bioplastics and biochemicals-based renewable sources, with highly efficient and sophisticated biochemical and engineering processes that produce a multitude of products from corn, one of the most significant crops in world.
The industry is becoming technologically sophisticated and is continuing to further diversify its product mix. New starch derivatives, such as clean label starches, continue to grow. Production costs will decline in real terms, and there will be further consolidation in the industry. However, the basic character of the industry is changing. Sweeteners, starch and alcohol will still account for almost 95 percent of total grind, down only slightly from the current share.
Corn refineries/possessing capabilities comprise the front end of an industrial complex that produces food, specialty chemicals, industrial products, fuels and pharmaceuticals. Such an expanded biorefinery would provide cleaner and more economical processes for producing existing products, new intermediates for manufacturing new products, and an expanded stable market for wet millers and for corn farmers.
A large corn wet-milling plant with its own steam and electric cogeneration station can form the nucleus for several other plants. Besides sweeteners and starch derivatives, the wet mill is the source of materials for plants that produce industrial enzymes, organic acids, amino acids and ethanol. The enzymes are then used to convert starch to lower molecular-weight products, principally various maltodextrins and syrups. The organic acids are used in processed foods, detergents, and polymers. The amino acids are used as feed and food supplements and, in the case of phenylalanine, to make aspartame. The ethanol is used as a fuel or an industrial solvent.
The recent shut down of the Memphis, Tenn. facility by Cargill has removed almost 2 billion pounds of sweeteners (mainly HFCS). Unmodified and certain modified starches have maintained supply demand balance along with stable prices even with record corn production and significantly lower cost prices. Penford was acquired in January 2015 by Ingredion, making Ingredion the largest manufacturer of specialty modified starches. A new small player High Plains Milling has entered this industry by restarting Cargill’s Dimmit, Texas facility.
Modified starches are utilized in hundreds and even thousands of food, industrial, biofuels, bioplastic applications. Unmodified starches have limited usage due to their inherent weakness of hydration, swelling and structural organization. To enhance viscosity, texture, stability among many desired functional properties desired for many food and industrial applications, starch and their derivatives are modified by chemical, physical and biotechnology means. Practically every category of food utilizes the functional properties of starch to impart some important aspect of the final product.
Figure 2. Modified food and industrial starches (corn, USA), 2014 estimate (million lbs)
Source: CRA, USDA and Private estimate
Clean Label Starches
The Clean/Simple label on foods as a marketing tool and to offer value added option is the most important area in recent food markets. The clean label starches for simple food labels are the fastest area of functional starches, growing at 5 to 7% depending on the market segment. In response to consumer demands, manufacturers are trying to simplify ingredient lists by removing and replacing artificial additives. There are a range of projects trying to find technical solutions that enable manufacturers to produce so called "clean label" products.
For more information on starches, browse S.K. Patil and Associates' relevant reports.
This report was written by Sakharam K. Patil, Ph. D., President of S.K. Patil & Associates, Inc.
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