Focus On Natural Gas
Energy experts outline problems of fluctuating and increasing prices.
Wildly fluctuating and increasing natural gas prices are causing major headaches for snack food companies, and many companies are looking for ways to respond.
“Natural gas is suddenly three to four times more expensive than historical levels, and it is likely to stay elevated,” explained Mike Stick, executive vice president of Snyder’s of Hanover, Inc., in an interview before SNAXPO 2006, slated for March 19-22 at the Mandalay Bay Resort and Casino in Las Vegas, Nev. “The point is that energy as a whole, whether for production, trucking, heating or cooling, has increased incrementally and now has become an important issue for all vendors and manufacturers alike.”
Ever-changing prices make it difficult to plan, and increasing prices only add to pressures on costs, added Stick, one of the key forces in helping SFA develop an energy seminar scheduled to be presented at SNAXPO.
A Volatile Energy Situation
The special educational session on energy was planned because of strong demand by SFA members, said Jim McCarthy, president & CEO of the association.
“Over the past year or two, energy pricing has been extremely volatile, and we wanted to provide as much information as possible so our members could understand major factors involved and develop a strategy to help them cope with both price increases and volatility,” he added.
Paul Vinson of Utilities Manager at Printpack, Inc., who manages the company’s energy business, was scheduled to lead the session.
In remarks prepared for that presentation, Vinson discussed details of natural gas supply, storage and demand, as well as the market structure and factors affecting price and supply. He also covered current market conditions and his outlook for the future.
In an interview prior to SNAXPO, Vinson suggested that companies with access to a competitive gas market may have an opportunity to work with competitive suppliers to achieve better natural gas prices, depending on the future’s market—a point he planned to expand upon during his presentation.
“It is a hugely volatile market,” he said. “That’s just the beast we have to deal with. It’s important for companies to understand the situation, to stay abreast of developments that are rapidly changing, and to better manage their energy needs. There are things you can do.”
More Discussions Planned
McCarthy noted that the energy program had originally been planned to cover petroleum and electricity, but because of the complexity of the issues involved, it was determined to confine the SNAXPO discussion to natural gas. Future discussions of other energy issues, including oil products such as diesel fuel and heating oil, will be planned for future conferences.
“The program we planned for SNAXPO this year was packed with solid information, resources and insight,” McCarthy said. “The energy session is just one example. Other sessions scheduled deal with RFID, acrylamide, food safety and nutrition, and many others.”
“Members who did not attend this year should mark their calendars now for next year’s SNAXPO,” McCarthy added. “It just keeps getting better and better, and has become a program that you can’t afford to miss.”
SNAXPO 2007 will be held next March at the Westin Diplomat in Hollywood, Fla.