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 Oct. 17, 2012 BrownfieldAgNews reports: Citing a sizeable price difference, Coca-Cola is moving toward using more high fructose corn syrup (HFCS) instead of sugar. Michael Ferrari, director of global agricultural commodity risk management for Coke told Dow Jones Newswires, "There is a clear directional shift." Ferrari notes that not only is the cost of HFCS cheaper, there are byproducts from the process which can then be sold for animal feed and energy, offsetting some of the raw material costs. To go with that, like other food companies, Coca-Cola is getting more involved in contract farming as a way to reduce price volatility and better control quality. In contract farming, the company supplies the grower with all of the inputs and agrees to buy the crop at a pre-determined price provided company specifications are met. Ferrari says his company contracts sugar cane in India, Australia, Thailand, Brazil, Egypt and South Africa. Corn is contracted in the U.S., Canada, Mexico and Brazil. Ferrari says they plan to expand contract growing in Africa to take advantage of the large tracts of land available on the continent. Tweet |
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