Spectrum, based in Springfield, Illinois, currently has two sides to its business: contract manufacturing and food ingredients.
While the former, which accounts for around 25 percent of the privately-held company's overall business, will continue to function under the Spectrum name, the latter is now being spun off into the new division.
Nexcel is offering natural, stable versions of trans fat free soy oils, and naturally processed soy ingredients which can be taken into the functional foods area.
President Rob Kirby told NutraIngredients-USA.com that the company had previously offered these same ingredients, but that the new division represents a whole new marketing effort.
"Primarily the reason for the focus on ingredients is because the functional soy business is growing," said Kirby.
Although he was not able to quantify in terms of market figures, he added that the beverage market is currently showing promise, as are on-the-go bars.
What is more, the new law making it obligatory to label trans fat content on food products in the United States, due to come into effect in January 2006, is encouraging manufacturers to reassess the type of fat they are using in their products.
"Trans fats go all the way through the food chain, so it is an excellent time to focus on this," said Kirby.
Nexcel's natural expeller-pressed and physically refined Nexsoy oils are being offered as a stable alternative to partially-hydrogenated oils.
Its newly rolled-out Zero-Trans Shortening is also designed to be a no trans fat, lower-saturate shortening for use in bakery products, donuts, microwave popcorn, margarine and general industrial frying.
Customizable depending on the application, it is available in non-GMO and organic versions.
A desire to avoid confusion with its similarly named competitor in functional oils, Spectrum Organics (recently acquired by Hain Celestial) is another reason behind the new ingredients division.
Since its soy oils are niche, Nexcel occupies a small share of the market and is not competing on a scale with the likes of ADM, Cargill and Bunge.
Nonetheless, the niche is expanding rapidly and Kirby is keen to expand market share.
He said that the company's oil sales were up 25 percent last year, and the organic section was up 50 percent.
The company's annual oil capacity across its several refineries is 60 million lbs - enough, said Kirby, to supply on a worldwide basis.
The company already ships to Asia, and is in the process of negotiating a deal in the EU.
Its capacity for soy ingredients is in the region of 100 million lbs a year.
External links to companies or organisations mentioned in thisstory: Nexcel Foods