Company: SXT
Filing Date: 2025-02-19
Form Type: 10-K
Source: 0001140361-25-005084
Chunk: 20

Company: SENSIENT TECHNOLOGIES CORP
Filing Date: 2025-02-19
Form: 10-K
Item: Item 1A
Chunk 20
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 production is energy intensive and dependent on successful farming techniques and favorable climatic and environmental conditions. As the demand for natural products continues to grow, the risks associated with
            agriculture, such as reduced crop yields, reduced crop availability, water shortages, increased water costs, reduced access to water, droughts, and other potentially more severe weather events, are becoming increasingly important. In addition,
            we obtain some raw materials from a single supplier or a limited number of suppliers. Disruptions or other issues with those suppliers could affect the availability of those materials. Even if there are multiple suppliers of a particular raw
            material, there are occasionally shortages. Constrictions in supply of raw materials can lead to increased costs. We may not be able to pass these costs to customers for a variety of reasons, including the fact that some of our competitors may
            not be subject to the increased costs. Additionally, government regulatory action against any of our suppliers or particular raw materials could also cause a supply disruption. We have, in the past, dealt with regulators shutting down
          and excluding from the market suppliers that provided the Company with raw materials. For example, in the recent past, the Chinese government has shut down a chemical park for pollution mitigation. This adversely impacted the supply of raw
          materials for the affected products and, therefore, impacted our ability to produce products containing these raw materials. Additionally, our yields from harvests for onion were adversely impacted by both drought and flooding in 2022-23 and by
          plant diseases, including downy mildew in certain growing areas, in 2024, resulting in reduced availability of onion products for our Natural Ingredients business in recent prior years. We increased the amount of onion and garlic planted in 2024,
          but there is no certainty that we will achieve greater yields or, if we do increase our yields, that there will be a market for such products. Any future unavailability or shortage of a raw material, however caused,
            could negatively affect our operations using that raw material and thus adversely affect our results.

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                We may not be able to manage inventory as effectively as anticipated, which may adversely impact our performance.

Efficient inventory management is essential to our performance. We must maintain appropriate inventory levels and product mix to meet customer demand, without incurring costs related to storing and holding excess inventory. If our inventory
          management decisions do not accurately predict demand or otherwise result in excess inventory, as has happened in the past, our financial results may be adversely impacted by markdowns