Unprecedented demand for natural colours spurs significant capital investment in Sensient’s natural colour manufacturing capacity, including expansion of largest production site in St. Louis, Missouri (USA)

Sensient Food Colors, a division of Sensient Technologies, officially celebrated the commencement of a major expansion at its largest natural colour plant, which is located in St. Louis, Missouri (USA). The expansion, coined Project Prism, is one of the many capital investments planned by Sensient to support the food and beverage industry’s rapid transition away from artificial colours in the United States. Sensient expects to spend up to $250 million in the coming years to expand its natural colour manufacturing capacity, supply chain, and personnel.

The St. Louis natural colours plant expansion is being done in partnership with Burns & McDonnell and will add 28,800 square feet of specialised processing and production capacity onto Sensient’s existing 500,000 square foot manufacturing facility.

“Sensient has taken a defining role in accelerating the industry’s transition to natural colour solutions. We are reinforcing our leadership position by making significant investments in capacity and infrastructure to facilitate the natural colour conversion in the United States. The groundbreaking ceremony marks a pivotal milestone in our mission to better serve customers and lead this industry-wide change,” stated Sensient Colors President, Steve Morris.

Citrus farmers are concerned about rising production costs. The sharpest price increase in March was observed for oil-related products, such as nitrogen fertilisers and diesel oil, due to ongoing tensions between the United States and Iran. This situation has disrupted oil production and constrained the global trade flow, leading to higher maritime freight costs.

Phosphate fertiliser prices have also risen, while potassium fertiliser quotations have seen only minimal increases.

Data from the National Agency of Petroleum, Natural Gas and Biofuels (ANP) show that diesel oil prices increased 15.4 % up to mid-March. Considering that, at the moment, the main mechanical activity performed by citrus growers is spraying, this rise in diesel prices could account for a 5.8 % increase in costs for the crop just from spraying alone, disregarding other activities and freight. This situation is concerning, as profit margins are expected to be tight in the next orange harvest.

Therefore, geopolitical developments in the coming weeks are concerning, as they could impact crop investments.