10/5/2004 - Cargill, the largest private firm in the US, will link up withbiotech giant Monsanto to bring food makers an alternative source ofsoybean oil, used to reduce the artery-clogging trans fats in foodproducts.
Sourced from the 2005 growing season Cargill will process thelow-linolenic soybeans designed by Monsanto.
The move marks a clear step from both firms to drive deeper into thegrowing market for trans fat alternatives, stimulated by incoming rules inthe US that mean by 2006 food manufacturers will have to label on thenutritional panel all trans fats in food products.
Trans fatty acids (TFAs) are formed when liquid vegetable oils go througha chemical process called hydrogenation. Common in a range of foodproducts biscuits, chips, doughnuts, crackers the hydrogenated vegetablefat is used by food processors because it is solid at room temperature andhas a longer shelf life.
But research suggests that trans fats raise LDL (bad) cholesterol levels,causing the arteries to become more rigid and clogged. An increase in LDLcholesterol levels can lead to heart disease.
As a result, the food industry is gradually slicing out their use as moreconsumers look for alternative products and in the US food manufacturerswill have to label any TFA content from January 2006. Europe has yet toimpose such rules, but pressure is building from consumer-ledorganisations.
In a statement this week Cargill said it will contract Iowa growers for upto 50,000 acres of the Monsanto Vistive soybean brand, designed by theSt.Louis-based firm that claims to have sunk more than $500 million intoresearch last year.
Cargill will pay a premium to producers who grow Vistive soybeans undercontract, then it will crush and sell the processed soybean oil to foodcompanies, said the Minneapolis-based firm that pulled in a 2004 profit of$1.28 billion (€1.04bn).
Sales growth for the vistive soybean oil is not only tied to the trans fatalternatives, but also to health concerns that are currently driving themarket for soybean oil as ongoing research suggests soy not only lowerscholesterol, but can also have a preventative effect on breast cancer andother hormone-related cancers. Both the UK and the US have approved ahealth claim for soy.
Today, soybean oil - together with palm oil - accounts for over half ofall oil consumed in the world. A recent report from analysts BusinessCommunications Company suggests that US production of major crudevegetable oils is slated to reach 8.6 million metric tons in 2008, withsoybean oil accounting for nearly 87 per cent of the major vegetable oilproduction at 7.4 million metric tons.
US consumption of fats and oils is projected to increase at an annual rateof 1.7 per cent, from 12.7 million metric tons in 2003 to 13.8 millionmetric tons in 2008.