Demand for sustainable palm oil is growing as consumer concern about deforestation builds but the complexity of commodity supply chains has made it hard to keep sustainably produced oil apart from non-sustainable oil.
First shipments
Palm oil that is entirely from sustainable sources, otherwise known as sustainable segregated palm oil, is only just beginning to hit the European market.
Lipsa said it received its first shipment of 3, 000 tons of segregated sustainable palm oil supplied by the plantation New Britain Palm Oil in January. And, by the end of April, the Spanish company will be receiving a second cargo.
A spokesperson for Lipsa told FoodNavigator.com that the intention to sell more sustainable palm oil is one of the key drivers for the capacity increases planned for 2010.
Increased capacity
Lipsa is increasing capacity at its Santa Perpetua site near Barcelona from 400, 000 mt/year to 650, 000 mt/year.
The vegetable oil processor is also building a new refinery in Puerto Exterior de Huelva in the south of Spain. Due to be finished in Q2 2010, the refinery will have an initial capacity of 250, 000 mt/year, with the possibility to be expanded to 500, 000mt/year.
This new refinery will serve the oil market in the south of Spain and abroad and is expected to reduce burdensome transportation costs.
Lipsa is making these investments in its refining capacity at a time despite a significant drop in sales revenues last year. Big decreases in world oil and fat prices meant the turnover in 2009 fell to €291m from €352m the previous year.
But in 2010, Lipsa expects the situation to improve, driven by the opening of its Huelva refinery and the increased capacity in Barcelona.
Lipsa processes a number of vegetable oils but specialises in palm oil and to a lesser extent sunflower, with the bulk of its production serving the food industry.