The Philippines: Rising cost of materials cuts carrageenan output

By Othel V. Campos
MANILA (Manila Standar Today).- Shemberg Marketing Corp., the country’s biggest carrageenan processor, said production has dropped 300 percent due to the high cost of materials.

“We used to produce 40 metric tons of cottonii powder per day but now, it’s down to 10 MT,” said chief executive and president Benson Dakay. “Everybody in the Philippines, Indonesia, China and Malaysia is in the same situation. Agricultural production has been reduced by 50 percent.”

He said the price of Philippine cottonii, a seaweed variety used in the production of carrageenan, went up two fold this year from $800 per MT to $1,600 per MT, while Indonesian cottonii was now $1,400 per MT from $600 per MT.

Iain Neish, Seaplant Foundation managing director in Indonesia, said the demand for seaweed-based products was on the rise but the local seaweed industry had failed to catch up.

He attributed the reluctance of industry players to invest in seaweed source development to poor access to finance, business services and other enterprise materials.

“Also, farmers’ link to seaweed to hydrocolloid value chains have become weak and they [farmers] have little capacity to recover from ‘force majeure’ events, like weather and peace and order problems,” Neish added.

Dakay said these were difficult times for exporters because of the peso’s continued strength against foreign currencies.

Source: http://www.manilastandardtoday.com