Gayatri Starchkem closes plant

Hyderabad-based Gayatri Starchkem Limited has shut down its sorbitol plant because of a continuing twin slump in demand and price. Gayatri Starchkem produced just 1,702 tonnes of sorbitol last year, which represents a mere 19.9 per cent of its installed capacity of its sorbitol plant.

Sorbitol is a sugar alcohol that the body uses slowly and is a sweetener used in diet foods. It is called a nutritive sweetener because it has four calories in every gram, just like table sugar and starch. The company, in its annual report, has pointed out that in 2002-03 it had produced 3,266 tonnes of sorbitol.

Presenting a bleak picture for sorbitol consumption, the company has pointed out that prospects in the current fiscal were also not hot.

"The year 2004-05 also appears to be not promising as the prices have not looked up and the company has closed the plant since April 04 and it would be opened as and when the demand picks up," the annual report noted.

"The demand for sorbitol continues to be sluggish and stagnant and as a result the prices have not looked up during the year and also the cost of production continues to remain the same," the company has said in its annual report.

The company, which also has a starch division, said that operations were affected in the division because of a paucity of working capital.

Gayatri Starchkem could crush only 17,896 tonnes of maize as against 20,395 tonnes of maize that was crushed in the previous fiscal. The company has pointed out that the losses could be contained despite a lower volume of crushing because the procurement prices of maize had come down.

In 2003-04, the company had reported a turnover of Rs 16.18 crore as against a turnover of Rs 21.29 crore for 2002-03. The net loss went up marginally from Rs 10.55 crore in 2002-03 to Rs 10.57 crore in 2003-04.