IFF invests in Dubai to leverage demand in Middle East & Africa
The production site, said IFF, will be located in the Dubai Biotechnology and Research Park and will help capture more of the local market.
Touran Cheraghi-Kroon, director, creative and applications for Innovation Flavours Europe, Africa and Middle East (EAME) said she expects the new Dubai labs to significantly shorten the innovation process and increase speed-to-market.
In terms of its EAME exposure prior to this development, IFF already had sales offices in Dubai and Israel, and manufacturing facilities in Egypt.
The supplier’s Q1 results in May reflected a good sales performance in the EAME region, with IFF reporting that double-digit growth in the beverage and savoury sectors there were significant contributors to its mid-teen growth.
An analyst who follows IFF but who wished to remain anonymous told FoodNavigator.com that the Dubai move is in line with general industry trends with most of the big players establishing application laboratories in emerging regions.
He estimates that being close to the market is especially important for flavour firms, as local tastes can vary wildly between geographies and companies need to understand the subtle variations in a population’s flavour preferences.
EMEA flavour facilities
April this year saw French flavour firm Mane, ranked as the world’s sixth largest flavour and fragrance company according to Leffingwell and Associates, enter into a joint venture in Jeddah to tap the growth potential of Middle Eastern food manufacturers – the first global flavour company to set up shop in Saudi Arabia.
Mane’s approach to the Saudi market was to set up an alliance with the Banawi Industrial Group (BIG) to establish Banawi MANE Flavors (Lazeez) for the conception, application, production and sale of food flavours.
Other firms in the top ten have physical entities in other Middle Eastern countries. For instance, Givaudan has two sales offices in the United Arab Emirates and one each in Iran and Turkey, as well as flavour creation and production facilities in Egypt.
Symrise has branches in Dubai and Egypt; and Firmenich has a subsidiary in Dubai.
IFF has been building on its existing presence in other emerging markets. At the start of the year, the US headquartered group announced it was establishing new facilities in Singapore and in Guangzhou, China, where it already has production sites, allowing it to use many of its existing resources in the region.
The investment is aimed at tripling production capacity, with the expanded output expected to come online by Q2 2012.
The Singapore facility is specialising in liquid flavour and fragrance compounds, with a particular focus on the South East Asian market, while the Guangzhou facility is catering to the Chinese market alone, and will supply all product types.