The Hawaii-based company said the increase will kick in within around three months.
“After careful evaluation, we have determined that we can no longer absorb fuel and energy increases, especially being located in Hawaii, which has some of the highest energy costs in the world,” said Cyanotech president and CEO Andrew Jacobson.
NutraIngredients-USA.com was unable to receive information on specific levels of price increases in time for publication this morning.
However, as part of Cyanotech’s first quarter results announcement, Jacobson said the firm will be implementing a price increase across all its products.
“The increase should be fully implemented by the middle of the third quarter of fiscal year 2009,” he said.
So far, since last quarter prices have only increased “slightly”, for one of the firm’s major products – spirulina.
Nevertheless, sales for the product increased 33 percent in the first quarter of fiscal 2009, ended June 30 2008. This was primarily due to increased units sold of bulk and packaged products.
In the US, spirulina holds Generally Recognized as Safe (GRAS) status for use in foods and drinks.
The company’s sales of natural astaxanthin also increased from last year. Bulk product sales increased 49 percent while packaged nutrition product sales increased by 126 percent, said the firm.
The company's flagship BioAstin brand of the antioxidant ingredient is marketed for its anti-inflammatory benefits, and for its ability to enhance skin, muscle and joint health.
Cyanotech claims BioAstin is the world's best selling brand of astaxanthin for humans, and grows the microalgae from which it derives the ingredient in shallow ponds at its 90-acre facility along Hawaii's coastline.
This year, the company announced it has been given approval for a total of 17 different structure/function claims in the US for its BioAstin. Structure/function claims are not as coveted by supplement manufacturers as qualified health claims, but still can contribute to the scientific and marketing clout of an ingredient.
Cyanotech also filed a formal petition in the European Union (EU) for six claims, which focus on joint health, skin health, protection from UV damage, eye heath and immunity.
Cyanotech said net income for the first quarter increased to $271,000, compared to a net loss last year of $382,000.
This improvement, said the firm, was primarily due to increased sales, increased gross profit, and a reduction in operating expenses.
Jacobson said in a statement: “The team really pulled together with improvements in all aspects of the business, including production. Our recent accomplishments in no way suggest we have turned our issues around, but they do show momentum toward continued improvement.”
However, despite the firm’s improved performance, it will still be passing on some of the increased costs to its customers.
“We expect continued pressure on input costs going forward and this could cause margins to decline in future periods. As everyone is aware, rising fuel and energy costs have taken a toll. This issue is not unique to Cyanotech Corporation,” said Jacobson.