Oil producers and suppliers say that supply chain concerns and the cost of oils are top-of-mind for their customers.
“Right now, the No. 1 question we’re hearing from our customers is focused on reliability of supply and managing the rising costs of goods,” said David Johnson, director of product management, food protection, Kalsec Inc. “With so much uncertainty in the market, companies are looking for ways to maintain consistency and control costs wherever possible.”
Richard Galloway, oils consultant with the United Soybean Board, pointed to the challenges of food companies shipping products into the United States.
“As a result, high-oleic soybean oil and other domestic oils have become favored products for the baking industry due to their resistance to oxidation, providing extended shelf life for packaged products and fresh baked goods,” he said. “Furthermore, soybean oil is a reliable oil or fat for most domestic food companies.”
Mr. Galloway pointed out that 95% of US soybean farmers participate in environmental conservation programs, have increased acres of conservation tillage and no-till practices and have reduced pesticides by using satellite imagery for targeted applications. In addition, soybean production has increased, with acreage rising 1.7% in the past five years while overall soybean production is up 5%.
John Satumba, PhD, global bakery technical lead and regional R&D director for North America, global edible oil solutions, Cargill, said customers are looking for reliable partners and assurances around supply. Cost concerns are also a top issue as they seek out more affordable options that still deliver high quality.
“Flexible formulations and adjunctive labeling are tools customers can use to manage supply chain issues, enabling brands to change ingredients without compromising product characteristics,” he said. “Our scientists work with customers to take advantage of these approaches, thereby providing a mitigation strategy should challenges arise.”
Cargill is also investing in regenerative agriculture practices.
“Alongside the work we’re doing to improve the sustainability of our palm oil supply chain, we’re also investing in regenerative agriculture for crops like soy, corn and canola,” said Tai Ullmann, sustainability lead, global edible oil solutions, Cargill. “For example, through our RegenConnect program, customers can help support farmer adoption of regenerative agriculture practices and claim the carbon that is sequestered through those acres.”
Consumers and customers are looking for healthier and lower carbon foods. Bunge Loders Croklaan publishes detailed monitoring and traceability information on public dashboards to respond to those concerns.
“Customers want to know that their ingredients are produced in a way that supports their values and their consumers’ values,” said Marina Negroponte, manager, ESG global customers and NA oils, Bunge Loders Croklaan. “That’s why it is so important that our supply chains are traceable, transparent and verifiable.”
Diana Visser, senior director, sustainability, Corbion, said more of Corbion’s customers are also asking about traceability of oils to geographic regions and growing locations.
“This increased interest in the supply chain can provide customers with added assurance about the sourcing and safety of the oils,” she added.
As the definition of sustainability continues to evolve, so have the commitments of oil producers and suppliers to protect the environment and ensure that farmers and their communities are treated well.
These industries are working to improve yield and better serve their customers while being good stewards of the planet.
This article is an excerpt from the April 2023 issue of Baking & Snack. To read the entire feature on Fats & Oils, click here.