Can Stevia Cash-in BIG as a Healthier Alternative to Sugar? STEV, IPSU, GLGL, SUWN & TATE : Blog

Can Stevia Cash-in BIG as a Healthier Alternative to Sugar? STEV, IPSU, GLGL, SUWN & TATE : Blog.

If you are looking for more exposure to agricultural commodities, sugar and sweetener stocks Imperial Sugar Company (NASDAQ: IPSU)GLG Life Tech (NASDAQ: GLGL),Sunwin International Neutraceuticals (OTC: SUWN)Tate & Lyle PLC (LON: TATE;TATYY) and Stevia Corp. (OTC: STEV) could all help to sweeten up your portfolio with profits. For starters, the huge clamor for corn, soybeans, wheat and just about every agricultural crop in general has been a huge boon to the agricultural industry. In fact, the Wall Street Journal has recently reported that the US Department of Agriculture is projecting total cash receipts, or income for agriculture will jump 9% this year to a record $341 billion. However, its also important to remember that not all agricultural commodities or crops, especially when it comes to sweeteners, are the same or have the same potential to deliver huge growth and profits as consumers are becoming more health conscious.

For example: USA Today pointed out last year that there is a heated debate going on over the health risks associated with consuming too much sugar, high-fructose corn syrup (HFCS) and other similar types of sweeteners. On one side of the debate are groups representing the sugar and high-fructose corn syrup (HFCS) industries who say their products are natural and do not cause weight gain or other health problems while on the other side of the debate are health and public interest groups who argue that these products come with health risks and need to be regulated more.

Whichever side comes out a winner in this debate over sweeteners will have major repercussions for the food and beverage industry and agricultural producers alike as Americans eat and drink an average of 22.2 teaspoons (or 355 calories) of sugar a day.

What is Stevia?

One lesser known agricultural crop that is an alternative to sugar and high-fructose corn syrup (HFCS) is Stevia. In case you are not familiar with Stevia, its actually 240 species of plants that are native to South America, Central America and Mexico (plus several species can be found in Arizona, New Mexico and Texas) that has long been used as a folk medicine by natives of these regions.

What makes Stevia attractive for farmers and food processors seeking a sweetener is the fact that its extract has up to 300 times the sweetness of sugar. Moreover, Stevia has also attracted attention due to higher demand for low-carbohydrate and low-sugar food alternatives. Since Stevia has a negligible effect on blood glucose, it also makes a great natural sweetener for those who are on carbohydrate-controlled diets.

Today, Japan consumes more Stevia than any other country in the world and accounts for 40% of the Stevia market. In fact, the Japanese have been using stevia for table use, food products and soft drinks (including in Coca-Cola).

Otherwise and in 2008, the US Food and Drug Administration approved Stevia extract Reb-A for use in the USA and in less than a year, Stevia’s US sales surpassed sales figures for saccharine and aspartame. Today, Stevia can be found in over 6,000 products ranging from beverages to foods to medicines and its increasingly heading towards mass commoditization like sugar and high fructose corn syrup (HFCS). Sales of Stevia sweetened products also topped $2 billion in 2011.

On the production side, China is now the largest producer of Stevia in the world followed by other Asian or South American countries. The Stevia plant itself is a perennial but its growing cycle can vary greatly depending on the type of Stevia and the growing location plus the plant is also sensitive to frost. Hence and in China, its common to only have one or two Stevia harvests but closer to the equator, its possible to harvest Stevia year round.

Who Produces Sugar, Stevia and Other Sweeteners?

For investors looking to sweeten their portfolio with Stevia along with sugar or other types of sweeteners, the following companies trade publicly:

  • Imperial Sugar Company (NASDAQ: IPSU). A processor and marketer of refined sugar and other sweeteners in the North American Free Trade Agreement (NAFTA) region, the Imperial Sugar Company had missed its last quarterly earnings estimate because it could not pass on raw material increases to its customers. In fact, Imperial Sugar Company’s stock then lost three-fourth’s of its value – despite the fact that it should otherwise be considered a safe and defensive food stock. On Friday, Imperial Sugar Company rose 6.32% to $7.07 (IPSU has a 52 week trading range of $5.75 to $25.68 a share).
  • GLG Life Tech (NASDAQ: GLGL). A Chinese integrated producer of Stevia extract, GLG Life Tech had issued a press release in early October that discussed operational obstacles that have negatively impacted the company’s business. A few days later, a short seller issued a detailed blog post outlining on-the-ground due diligence that concluded that the stock will not be staging a rebound. Nevertheless, GLG Life Tech and other Chinese Stevia producers face a bigger problem: When it comes to sweeteners, the Chinese do not care about calorie content as much as Americans do. However and on Friday, GLG Life Tech rose 7.69% to $1.96 (GLGL has a 52 week trading range of $1.34 to $12.45 a share).
  • Sunwin International Neutraceuticals (OTC: SUWN). Another Chinese company that is involved in selling Stevia based products as well as herbs used in traditional Chinese medicines is Sunwin International Neutraceuticals. However and while Sunwin International Neutraceuticals has not faced the same types of allegations as GLG Life Tech, its still a Chinese stock and would face the same problems with Chinese consumers as GLGL. On Friday, Sunwin International Neutraceuticals rose 9.18% to $0.345 (SUWN has a 52 week trading range of $0.21 to $0.40 a share).
  • Tate & Lyle PLC (LON: TATETATYY). With its headquarters on Sugar Quay Lower Thames Street, Tate & Lyle PLC has two operating divisions: Speciality Food Ingredients (SFI) and Bulk Ingredients (BI). In 2010, Tate & Lyle PLC sold its iconic sugar business to American Sugar Refining but the company kept Splenda – its sucralose zero-calorie sweetener. On Friday and on the London Stock Exchange, Tate & Lyle PLC loss 0.67% to £644.65 (TATE has a 52 week trading range of £608 to £683 a share), putting it out of reach of most investors but on the OTC, TATYY rose 5.35% to $41.35 (TATYY has a 52 week trading range of $31.16 to $43.25 a share).

What is Stevia Corp. (OTC: STEV)?

Stevia Corp. is a Farm Management company focused on Stevia agronomics that ranges from Stevia plant breeding to agricultural practices to post harvest techniques. Stevia Corp’s headquarters is in the USA while its R&D operations are in the USA, Singapore, Vietnam and Indonesia. Stevia Corp’s farm operations are located in Vietnam and Indonesia while farming operations in the USA are still in the planning stages.

Stevia Corp is the only company that delivers a full spectrum of agricultural consulting and related solutions for Stevia growers. Specifically, Stevia Corp. invests heavily in R&D and IP acquisition as well as manages its own propagation, nursery and plantations plus the company provides services to contract Stevia growers and other industry growers.

For now, Stevia Corp. has a supply contract in place with PureCircle, the Stevia industry’s leading refiner, to purchase Stevia at a fixed price. This contract greatly enhances Stevia Corp’s ability to plan for the long-term.

Moreover and once Stevia Corp. is able to produce enough Stevia to support an extraction facility, it may begin negotiations with PureCircle or another major refiner to form a joint venture to build and operate an extraction facility near where Stevia is grown. Stevia Corp. is also considering private labeling its own Stevia products in order to build up its own brand.

On Friday, Stevia Corp. rose 3.09% to $1 and has a 52 week trading range of $0.01 to $1.60 a share.

The Bottom Line About Stevia Corp.

Of course, there is always a risk that scientists will find some type of health risk associated with Stevia. Nevertheless and with Americans eating and drinking an average of 22.2 teaspoons of sugar a day, sugar and sweetener stocks Stevia Corp. (OTC: STEV), Imperial Sugar Company (NASDAQ: IPSU), GLG Life Tech (NASDAQ: GLGL), Sunwin International Neutraceuticals (OTC: SUWN) and Tate & Lyle PLC (LON: TATE; TATYY) will probably never run out of customers for their products.

    • Christy Overbey
    • October 8th, 2012

    I always love stevia because it is a great substitute for sugar and it can be taken by diabetics. .`;:.

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