Monday, November 1, 2010

Corn processors regain 'whip hand' in price talks

The power in the annual round of talks to set prices of corn sweeteners has returned to processors such as Archer Daniels Midland and Tate & Lyle, leaving buyers on track for price rises of up to 25%.

The proportion of plant capacity in use among makers of high fructose corn syrup looks set to tick up to 85%, thanks to resilient US sales of the sweetener and a doubling in exports to Mexico, Credit Suisse said.

This extra usage means that "the whip hand in annual negotiations swings towards the sellers", the bank said, adding that the outcome of the talks "will be fine" for corn processors.

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