Saturday, July 26, 2014

Nutritional Products Sales Increases

In 2013, DSM, FMC, BASF, and DuPont had significant nutritional products sales.  Each company has a separate segment where nutritional products represent an important contribution to the segment’s sales.  In 2013, DSM's segment, called Nutrition, accounted for 46.4% of total company sales.  For the other companies, their corresponding Nutrition & Health segments represented these percentages of total sales: FMC – 19.7%; BASF – 2.8%; and DuPont – 9.7%.  These segments do provide other products in addition to nutritional products, including personal care and flavor/fragrance products, but, nevertheless, nutritional products certainly are part of the segments’ strategic sales goals.

Also, these Nutrition & Health segments are showing reasonably strong sales increases.  For example, the compound average growth rate percentage increases from 2011 to 2013 for the companies’ segments are: DSM – 7.3%; FMC – 5.2%; BASF – 3.9%, and DuPont – 12.2%

Nutritional products being sold by these companies include the following:

DSM - vitamins; nutritional lipids (polyunsaturated fatty acids); enzymes; cultures; and carotenoids.

FMC - omega-3 oils and fatty acids.

BASF - vitamins; carotenoids; sterols; enzymes; and omega-3 fatty acids.

DuPont – probiotics and cultures.

These four, large chemical companies appear to have strong interest in developing their nutritional products businesses.  Reasons might include:

1.  New developments in human and animal nutritional need to be based on good, strong science.   Good, strong science is a major asset of these companies and putting this asset to work, from which useful, in-demand products can be developed, would be attractive to the companies.
2.  Chemical companies excel in the supply chain/logistical requirements of processing raw materials through multiple steps into finished products, an excellence that match well the needs of nutritional products.
3.  Because of 1 and 2, these companies can differentiate their products from others and through these differentiations, higher margins can be expected.

4.  With larger global, more economically robust, and older populations, interest and use of nutritional products likely will grow.

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