Combating casein prices: How soaring raw material costs are driving demand for alternatives

Soaring casein prices are putting food and beverage manufacturers under pressure. With dairy prices in Asia Pacific at multi-year highs, manufacturers of non-dairy creamer, ready-to-drink (RTD) tea and coffee, and analogue cheese are racing to find ways to maintain margins and avoid passing on all the additional costs to consumers. Casein and its derivatives, such as sodium caseinate, are commonly used as a thickener, emulsifier and stabilizer in a range of food and beverage products. In non-dairy creamers and RTD beverages, caseinate provides emulsion stability and delivers the desired mouthfeel, while in analogue cheeses rennet casein enhances texture, melting properties, stringiness and shreddability. The search for more affordable, price-stable alternatives has led manufacturers to Cargill.

The properties of casein have made the protein a critical component of many products, notably non-dairy creamers. That reliance on casein is now becoming a problem for manufacturers. Casein is derived from milk. As such, the price of casein fluctuates in line with changes in the wider dairy market. Over the past year or so, the price of whole milk powder has increased sharply, rising from around $3,000 a tonne to $4,500 a tonne in a matter of months.¹​​ Prices are forecast to remain elevated.

At some point, dairy prices may fall but the relief the decline brings to the companies that rely on casein will be temporary. Dairy prices are inherently volatile and at some point in the future may rise again. That prediction is supported by historical trends, which show the global per tonne price of whole milk powder has ranged from around $1,500 to more than $5,000 over the past eight years. As researchers have explained, “even small shifts in supply can cause very large changes in price​.”²​​

Finding fixes for price volatility​

The current high price of a key raw material, and the near certainty that prices may rise sharply again in the future, pose challenges to food and beverage manufacturers, which need to deliver products at a consistent price while contending with significant swings in the cost of production. The challenge has led manufacturers to seek alternatives to casein.

Modified nOSA (n-octenyl succinic anhydride) emulsifying starches are the first choice of many manufacturers. Products such as Cargill’s C*EmCap and C*EmTex lines of instant emulsifying starch can aid in emulsification and deliver the mouthfeel of caseinate at a lower price not tied to the dairy market. Similarly, other starches including Cargill’s C*Stretch series provide the shreddability and meltability that casein brings to analogue cheese while minimizing the impact of dairy price volatility.

The popularity of emulsifying starches is supported by their stability and the greater control they bring to the manufacturing process. However, in some applications manufacturers are seeking out other options to maintain the protein content of their final products.

Plant-based proteins offer a way for manufacturers to move away from caseinate while maintaining protein levels. However, the sensory properties of the protein are less suitable to some applications, for example because they impart a beany flavor to non-dairy creamer and RTD tea and coffee, creating a need for a clean-tasting protein product that can be an effective replacement of caseinate in these applications.

Pea protein isolate offers manufacturers a way to bring emulsification and texturization to products without compromising protein levels, as Vicki Chen, Technical Category manager, Convenience, Cargill Asia Pacific, explained.

“Emulsifying starch has been known to be a star solution when it comes to casein replacement – especially for applications like non-dairy creamer. Cargill has a wide range of nOSA pregelatinized and cook-up starches that can help manufacturers experience excellent mouthfeel, emulsion and cost savings. But what our customers have found most interesting is that our Radipure pea protein isolate is able to help them maintain protein levels, while reducing costs in this volatile time, and most importantly with minimal impact on the sensory profile​,” Chen said.

Supporting the switch to casein alternatives​

Cargill produces its cook-up and pregelatinized emulsifying starches at three plants in Europe and North America, equipping it to serve manufacturers that need their emulsifying, viscosifying, texturizing, and process and storage stable properties. Radipure pea protein is produced in Asia, to serve the needs of Asian manufacturers that need protein based on non-GMO, hypoallergenic peas.

The emulsifying starch and pea protein production infrastructure is part of a much broader operation that includes 13 Innovation centres and application labs globally. Working out of the sites, Cargill offers a range that spans texturizing solutions, polyols, stevia, pea protein and more, plus expertise in how to formulate the ingredients to meet consumer demands and adapt to production requirements. 

References​

1. Asia Pacific dairy prices to average at multi-year highs in 2021, highlighting strong recovery in demand. https://www.fitchsolutions.com/commodities/asia-pacific-dairy-prices-average-multi-year-highs-2021-highlighting-strong-recovery-demand-30-04-2021​ (2021).
2. Rezitis, A. N. & Kastner, G. On the joint volatility dynamics in international dairy commodity markets. Aust. J. Agric. Resour. Econ. 65, 704–728 (2021).