Raisio enhances production for continued Asian invasion

By Neil Merrett

- Last updated on GMT

Related tags Supply and demand Asia

Raisio has announced an expansion of its Finnish production
facility to meet growing demand in Asia of its cholesterol lowering
Benecol ingredient - as part of a bid to turn around declining
profits in the sector.

The company saw sales of its ingredients arranges last year decline slightly to €49.7m from €50.2m in 2005, and hopes capitalising on growing markets in Asia can turn this around. Raisio was unable to specify any exact details regarding the expansion. The company's Benecol branded plant stanols are one of its most important sources of income. Stanols are cholesterol-like molecules derived from plants, and are increasingly well known to consumers due to their scientifically proven ability to reduce HDL (bad) cholesterol levels. Though the company has been involved for some time in distributing Benecol within Asia, a Raisio spokesperson told AP-Foodtechnology.com​ that the region remains a major market for the group. "The Asian market has been a long time aim for Raisio, with its markets continuing to offer significant potential for our brands," they said. The spokesperson attributed this growing potential for ingredients in Asia to growing concerns over health and nutritional benefits. "Cholesterol levels in Asia are quite high, and with consumers increasingly concerned about their health, we expect our products to be a success." Demand for Benecol in Asia has been driven in part by major markets like China and India, where consumers have higher disposable incomes than in the past, but the adoption of western eating habits that are less healthy than traditional diets is pushing up heart disease rates. The spokesperson added however, that a number of South-East Asian markets like Thailand are also becoming important to achieving the company's ambitions for growth. Though the company is expects continued growth in its Asian markets, it has decided against setting up production facilities in the region. Through its expanded production facilities in Finland, and its plant in the US, Raisio is confident that the company can meet growing demand for Benecol. "We have two good plants in operation, and these will definitely be sufficient for our aims," added the spokesperson. They did not rule out the possibility of the company considering a local production facility within Asia in the future if the market demanded, however. "In the future perhaps we may see investment in the area, though we are currently waiting to see how the market unfolds," they said. To further support its two existing plants, the company added that Raisio would continue its strategy of working with local partners to better adapt to foreign markets. "The company believes that working with firms who are aware of local circumstances is the best way to tailor our products to specific markets," they said. After buying back its Chinese sales rights for products containing Benecol in November 2005, the company is thought to be keen on once again reestablishing links with firms in the country.

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