Danisco strengthens presence in India's budding markets
India with the opening of two new manufacturing units focusing on
functional systems and enzymes.
The Danish group has invested $6m (€3.9m) into the new plants, which open tomorrow and will serve its South-Asian customers in India, Sri Lanka, Bangladesh and Pakistan. Food expenditure is increasing on average in India as the country experiences economic growth, sparking western companies to step up investment there. Danisco wants to be at the forefront of this growth, putting its attentions to gums and systems, aimed mainly at the dairy industry, and enzymes, which cover a wide range of applications. "All food markets are experiencing growth in India meaning it is a very exciting area for us," Angela Fan, Genecor division communications manager, told FoodNavigator.com. "Before we were importing products, but now we want to provide a more direct service to our customers." According to Business Monitor International's India Food & Drink Report, food consumption is set to increase 9.4 per cent by 2012. However, it says this is a modest rate when considering the pace of the country's economic expansion, relating to just 4.3 per cent in per capita terms. Dairy growth Anders Wilhejelm, executive vice president of gums and systems, said: "The SAARC [South Asian Association for Regional Cooperation] region has been showing sustainable double-digit growth in Danisco, and the new functional systems plant will give us an edge to become one of the first international functional systems plants in the region." Functional systems refer to a combination of emulsifiers, hydrocolloids and stabilisers, and Danisco has opened the unit to respond to the particular growth experienced in India's dairy market. According to the company, India is the largest milk producer in the world with an annual production of more than 100m litres and a growth rate of 3.8 per cent. It therefore sees the area as having huge potential for value-added dairy products. Danisco intends to concentrate especially on ice cream, a sector it has been serving for 75 years. Wilhjelm told FoodNavigator.com: "As the economy grows, we think more people will buy their dairy products from supermarkets rather than make them at home. Because of the increase in production costs related to raw materials, we hope to help customers reduce dairy milk solids using methods such as increasing the amount of water or air without compromising on taste." On whether the move will save production costs for Danisco amid the current climate of soaring raw material and energy prices, he explained that the new units were not built with that intention. However, they will have a shorter supply chain, which they hope will ensure consistent quality. Enzymes According to Danisco, the industrial enzymes market is worth an estimated $75m (€48.5m), and is experiencing rapid growth in India. Danisco aims to seize this opportunity by opening an enzyme manufacturing plant, operated by its Genencor enzyme division. Tjerk de Ruiter, CEO of Genencor division, said: "Genencor has continuously been increasing its presence in India and investing in this market to satisfy quickly growing opportunities for its enzymes business. "We have ambitious plans to take the expansion further with this important step, as the new plant will provide even stronger and reliable support to our local customer base." The plant will primarily produce enzyme blends to service the markets of food and beverages, animal nutrition, fuel ethanol, grain processing, laundry detergents and textiles.