DSM hikes vitamin A price

The mark-up relates to the global food, pharma and personal care industries as DSM has already raised vitamin A prices to animal nutrition and health clients.

DSM's global vitamin Aproduct manager, Dr Steffen Ruf, told NutraIngredients.com booming crude oil prices contributed to the price rise as its vitamin A is sourced from oil by-products such as acetylene, acetone and methanol.

It is the first time DSM has increased the cost of vitamin A "in recent years".

The price rise follows similar gains for vitamin E last year in which similar reasons were cited, and more may be on the cards.

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We expect that vitamin E prices will continue to increase in the near term, however, no price increase threshold is currently on our agenda," Ruf said.

Vitamin A as a raw ingredient is only available via synthetic production unlike other letter vitamins such as vitamin E and vitamin C.

It is typically associated with eye health, overall physiological development and tissue differentiation.

Crude reality "A lot of this has been driven by the crude oil market situation," Ruf said.

"Obviously that is completely out of our hands and has been influential in the rise.

Energy costs have also been on going up across Europe and we have been affected by that."

DSM meets all of its global vitamin A customer requirements via a Swiss production facility.

Ruf emphasised the rise was also being driven by demand for "high-quality" vitamin A. "Our research indicates consumers are keener than ever to purchase quality ingredients and products and they are willing to pay for that quality.

I won't name names but there is a lot of vitamin A around that is of significantly lower quality than ours."

He added: "For us it comes down to customer perception about the quality of the ingredient and our customers are more and more focused on that.

We have the reputation for producing some of the highest quality vitamin A in the world."

Supplements down, raw materials up

He said the trend towards "natural" wasn't affecting the vitamin A market as, despite its synthetic processing, its purity was not questioned.

Yet sales of single-letter vitamin A supplement sales have been falling in western Europe with Euromonitor noting a decline from €31.1m to €23.9m between 2000 and 2006.

The UK saw a particularly sever contraction in this market from €10.3m to €2.7m.

However over the same period raw material sales leapt more than 22 per cent from €230.4m to €281.5m indicative of the wide variety of human and animal vitamin A applications as well as the fact there is no widespread vitamin A deficiency in the general population as there is in other vitamins like vitamin E. DSM estimates two thirds of its human-use vitamin is used in food supplements and one third in foods.

It said the US supplements market represented a "significant amount of vitamin A" but wouldn't specify which food applications filled most of its orders either in Europe, North America or other regions.