Wednesday, February 3, 2010

"Now taste remains the same but the source has changed!!!"


As we have seen that sugar price in India is increased by more than 100 percent. The reason is that India is facing problems in compensating the country’s requirement because of scarce water, competition among crops and rising consumer demands. So does it mean that upcoming generation will short-off sugar? Of course not, we have one more substituted-solution to grab.

Thanks to corn which helps us in an economically way. Corn contains starch, which yields a thick sweet liquid called High Fructose Corn Syrup (HFCS). As because of thick liquid nature, it can’t be converted in to table sugar crystal, which we use at home. This type of sugar can be used in those processes which require melted liquid sugar, instead of crystalline form. For example, we can use HFCS sugar in cakes, confectionary, sweets, ice creams, cold drinks and also in wines. Its sweetening index can be adjusted by modulating level of fructose to glucose. Some of the HFCS are even 30% sweeter than cane sugar.

USA is using this sugar since last 30 years, because there is very less production of cane. Sugar cane in India was cheap and plentiful. But at present India is not able to establish equilibrium between demand and supply, thereby causing sugar price to reach at Rs.45 per kilogram.

India grows about 18 million tonnes corn annually and one kilogram gives 600 gm fructose. Industry watchers say, at current corn prices, the basic grade - HFCS 45% - would cost Rs 26/kg at factory gate and can reach the wholesale market in barrels, after paying tax, at about Rs 32/kg. By-products will fetch extra incomes to firm. Suddenly, locally produced fructose is the smart cheaper alternative.

Advantages of HFCS:

Corn production requires less water, less nutrients and less educated labour than cane. It can be grown by marginal farmers in Bihar, Karnataka, Andhra Pradesha, etc.

Many corporate are planning to entertain this sector by entering in it. India’s first HFCS factories are expected to start manufacturing within next six months. “We will start with HFCS 45%. Our calculations show that local fructose will always be at least Rs 2/kg cheaper than sugar. That would mean big saving for industrial users. Moreover, with a 30% import duty, there is no threat yet from imported HFCS,’’ said a player in the starch industry.

The overall success of HFCS- corn sector can be analyzed by the acceptance of industrialist and people who consume it.

Cola companies are among India’s biggest consumer of cane-sugar. For compensating their requirements, they collect sugar from every part of India. Although in western countries, they use HFCS 55%, in premium grade in beverages. But Indians are very reluctant to change their taste. It’s a matter of concern for HFCS’s manufacture that at what standard (in terms of HFCS %) it will penetrate in the Indian market and liking by the people. Last year PepsiCo gave its American consumers a nip of what we drink by introducing Pepsi and Mountain Dew “Throwback” versions, made with pure sugar instead of HFCS, as a two-month promotion.

If HFCS comes in a behavior of country people thereby it can replace even 30% cane sugar of consumption, will cause to resist of importing sugar from other countries, and we will be self-sufficient. But the question is that when it challenges the monopoly of cane sugar and defeats the same. But as far as price of sugar is concerned, then it will soon to take charge.

Which one is sweet cane or corn?

Hint: decide on the basis of prices/kg they offer.

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