Shemberg Corporation, the country’s largest carrageenan producer, is asking the government to impose restrictions on seaweed exports in order to assure availability of its raw materials.

Shemberg Chairman Benson U. Dakay, who is also Seaweed Industry Association of the Philippines (SIAP) President, disclosed that because of low seaweed production, Shemberg’s carrageenan output is currently down to only 30 percent of its 10,000 MT capacity.

"There's no more seaweed in the Philippines. We have to rely on Indonesia, Vietnam. But there will only be planting if the government will provide financial assistance to farmers," said Dakay.

The country's seaweed export destinations are China or Hong Kong, 30 percent; France, 25 percent; US, 15 percent, South Korea, six percent; Spain, 10 percent; Denmark, four percent; and Brazil, two percent.

But even with its big unutilized carrageenan capacity, Dakay said the Philippines remains as the world's largest producer of carrageenan. However, Indonesia is fast positioning its carrageenan production and is even planning to ban seaweed export by 2012 so that it can turn all its raw material into pricier, high-value added carrageenan products.

Indonesian Department of Fisheries Director Dr. Victor Ph Nikijuluw said in the same press briefing that Indonesia targets to produce one million metric tons of seaweeds by 2014, three times its present production of 300,000 MT.

Nevertheless, Dakay said the Philippines still has advantage over Indonesia when it comes to technology.

Shemberg itself, a pioneer carrageenan producer in the country, is able to survive the depressed seaweed production through the manufacturing of niche products like spinossum for whitening which has a market in India. Other new applications for carrageenan are animal-free soft gel capsules, biodegradable digestible films, and microbicides for HIV or AIDS prevention.

The Philippines apparently needs to expand its seaweed production to take advantage of the growing demand for carrageenan products which is at a rate of seven to eight percent yearly. The Philippines as of 2007 produced the largest carrageenan at 34,500 MT, taking up 41 percent of total world production of 84,700 MT. It is followed by Indonesia which produced 17,000 MT.

The Indonesian government is brokering a partnership between the Philippines and Indonesia in order to produce carrageenan chips that have many uses for pharmaceuticals, cosmetics, and consumer products, according to Nikijuluw.

Fortunately, the Philippines still enjoys a price premium for cottonii seaweed compared to Indonesia at $1,300 per MT compared to Indonesia's $1,200 owing to higher quality.

Seaweed production in the country comes from Tawi Tawi, 13,740 MT as of 2008; Jolo, 12,360 MT; South Cotabato and other Mindanao provinces, 10,990 MT; Palawan and Calamian islands, 8,200 MT; Cebu and other Visayas provinces, 8,900 MT; Sorsogon and other Bicol Region provinces, 3,500 MT; and Mindoro and other Luzon provinces, 4,200 MT.

Shemberg is a widely diversified producer of carragenan whose applications are in food and non-food production.

Its subsidiaries are Shemberg Biotech Corp. in Carmen, Cebu which has a 1,600 MT per year carrageenan capacity; Shemberg Marketing Corp. in Pakna-an, Mandaue City, 3,600 MT per year; Shemberg Food Ingredients in MEPZ, Mactan, Cebu, a blending facility; and Polysaccharide Corp. in Zamboanga City, 4,800 MT per year.

Its products are pet food grade using kappaphycus and iota seaweed varieties; food grade semi-refined; and refined grade which uses kappaphycus, iota, lambda, and kappaphycus 2.
Worldwide producers of carrageenan are Shemberg, 10,000 MT, 13 percent; CP Kelco, 8,000 MT, 10 eprcent; FMC, 7,500 MT, nine percent; Marcel, 7,300 MT, nine percent; Cargill, 4,700 MT, six percent; and Shanghai Brilliant, 3,000 MT, four percent.

Shemberg's markets are Europe, 38.6 percent; Canada and the US, 28 percent; Australia, 16.5 percent; Asia, 10.5 percent; and Latin America, 6.3 percent.