As the year comes to a close, a battle for market shares and customers has erupted among native starch suppliers. The recent increase in wheat starch supply and a stagnating demand from paper mills are having an impact on how negotiations for 2020 deliveries are panning out.
Prices for deliveries of native wheat and corn starch are on the downward trend as of the second quarter 2019. And the negative price trend is expected is continue in the new year, at least for native wheat starch.
According to EUWID sources, wheat starch buyers have been successful in demanding renewed price cuts in negotiations for 2020. An increased supply due to new market capacity has given rise to supply shifts and triggered price-based allocation battles among wheat starch producers.
What is more, demand from the paper and packaging industry, which is considered one of the major sales markets for starch products, has fallen behind expectations in 2019. Currently, the packaging paper industry is going through a weak phase albeit at a high level. The industry has failed to reach the targeted growth rates for 2019, EUWID sources remarked.
This article is an excerpt from EUWID's market and price coverage on market for raw materials and consumables in Western Europe.
Find the EUWID Price Watch Native Starch Western Europe for the fourth quarter 2019 in EUWID Pulp and Paper issue no 51/2019 available to our e-paper and print subscribers as of 18 December.