Arla Foods makes bold investment in Argentina to boost protein and infant formula production

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October 10, 2023

A subsidiary of the Danish dairy conglomerate Arla Foods is making an investment in an established facility located in Argentina, with a focus on producing proteins and infant formula applications.

Arla Foods Ingredients intends to incorporate a new drying tower into its Porteña facility, characterizing it as a “substantial enhancement.” However, the company has not disclosed the exact amount of capital earmarked for this project.

The installation of a new tower, slated for completion in 2026, is expected to increase the production of permeate powder, a high-lactose ingredient derived by extracting proteins from milk for food manufacturers, more than twofold.

Arla Foods has stated that the expansion of the Porteña plant aims to meet the increasing demand for premium whey ingredients, both within Latin America and on a global scale. Additionally, the company has received approval to manufacture dairy proteins for infant formula products.

Despite Argentina’s struggle with hyperinflation, where prices are soaring at a rate exceeding 100% due to the devaluation of the local currency, the peso, it continues to attract investment.

In a statement made today, October 9th, Henrik Andersen, the CEO of Arla Foods Ingredients, made reference to the economic challenges while announcing the investment.

“We’ve had a presence in Argentina since 2000, and despite the country’s economic fluctuations, we’ve consistently delivered strong results. This positions us to invest in future growth,” stated Henrik Andersen, CEO of Arla Foods Ingredients.

In its 2022 annual report, Arla Foods did not disclose a detailed breakdown of its revenues and profits attributable to Argentina, neither for the entire group nor specifically for Arla Foods Ingredients.

When releasing its first-half results in August 2023, the parent company Arla Foods noted the presence of inflationary pressures and volume declines at the group level, resulting in a downward revision of its guidance for the year.

“As expected, the first half of 2023 was characterised by continued inflationary pressures, falling market prices for dairy products and a shift in consumer behaviour towards discount channels and private-label products,” the company said.

The full-year sales projection has been revised to a range of €13.2 billion (then $14.2 billion) to €13.7 billion, as opposed to the earlier forecast in February of €13.6 billion to €14.2 billion. Additionally, the expected profit as a percentage of revenue is now anticipated to be between 2.8% and 3%, down from the previous range of 2.8% to 3.2%.

In order to facilitate the manufacturing of infant formula ingredients at the Porteña facility, Arla Foods Ingredients stated that it has had to adhere to stringent global criteria regarding nutritional value and hygiene.

A permit was granted in June, with the business expecting that a “significant portion of the Porteña plant’s total production will go to infant-nutrition ingredients within the first year and grow further thereafter”.

Arla Foods Ingredients will source the base products locally after entering agreements with dairy suppliers and offered training to “ensure that the raw materials meet the required quality”.

Andersen added: “We are proud that we can now produce for the infant sector from Latin America. Getting here has required time, resources and a high degree of cooperation – not only between our Danish and Argentinian departments, but also with local dairies. Everyone has effectively contributed to us now being able to lift our business further.”

Body Science expands manufacturing capabilities with successful acquisition of Halo Food Factory

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October 10, 2023

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Body Science protein powders (Representative Image)

Body Science International, an Australian-based sports nutrition company, has successfully completed the acquisition of a nearby manufacturing facility previously under the ownership of Halo Food Co.

In a LinkedIn post, Sheree Young, the CEO of Body Science, a company under the Humble Group umbrella, announced the acquisition of the factory from the administrators of Halo Food. Halo Food had entered voluntary administration in August.

Australian media reported the plant is located in Sydney. Young said on LinkedIn “the acquisition by our group assures ongoing employment for the staff affected by the recent events in Halo Food group”.

Halo Food, a company listed on the Sydney Stock Exchange but headquartered in New Zealand, announced in August that it had appointed administrators Rahul Goyal, Kate Conneely, and Michael Korda from KordaMentha. The receivers, led by David Hardy, Ryan Eagle, and Emily Seeckts, were from the accounting firm KPMG.

Prior to commencing the proceedings, Halo Food had divested its weight-loss business, The Healthy Mummy. The company operated three manufacturing facilities in Sydney and Melbourne, along with an additional one in Christchurch, New Zealand.

Located in Burleigh Heads, Queensland, Body Science was acquired by Humble Group, headquartered in Sweden, during the summer of the previous year. This Australian company manufactures protein powders and bars under the BSc brand, as well as weight-management and pre-workout supplements.

“Integrating manufacturing capabilities into our group in Australia is an exciting development and opens up further opportunities for support and growth for our BSc Brand and other Humble Group brands in our region,” Young said.

“Humble Group already have extensive manufacturing capabilities in FMCG throughout Europe and the investment in Australia is a testament to the opportunity here and the ongoing support for Australian manufacturing of BSc products.”

Body Science, which distributes its products through direct-to-consumer channels and independent retailers, served as Humble Group’s introduction to the Australian market. Although specific financial details were not disclosed at the time, the Swedish company noted that Body Science was generating sales amounting to SKr284 million (equivalent to $25.7 million today) and reporting profits based on EBITDA of SKr53 million.

A representative from Humble Group has verified that the factory transaction by Body Science is anticipated to conclude within the “coming week or thereabouts.”

BlueNalu raises $33.5 Million in funding and expands strategic partnerships for cell-based seafood production

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October 10, 2023

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BlueNalu, a cellular agriculture company headquartered in the United States, secured $33.5 million in funding through a Series B financing round, attracting support from both new and existing investors.

The firm, which is dedicated to becoming the foremost global player in cell-based seafood production, has emphasized that the funding secured through this Series B round will fuel its next phase of expansion and accelerate the journey toward the widespread production and distribution of sustainable seafood on a global scale.

Following regulatory approval, BlueNalu plans to launch its first commercial product, the premium bluefin tuna toro. The toro portion of bluefin tuna is highly sought after in Asia, where over 80% of the estimated global supply is consumed.

BlueNalu highlights that at present, bluefin tuna is only accessible in extremely limited quantities, exhibits significant variability in terms of quality and sensory characteristics, and confronts substantial challenges such as declining fish stocks stemming from issues like overfishing and illicit, unregulated, and unreported fishing practices.

Aside from securing additional capital this month, the cellular agriculture seafood company also unveiled its intentions to broaden and strengthen its strategic collaborations with three major multinational players in the seafood industry headquartered in the Asia-Pacific (APAC) region.

These partnerships are poised to aid BlueNalu in its scheduled rollout of cell-based seafood across several APAC countries in the upcoming years. This support will encompass activities such as gaining market insights, comprehending regulatory prerequisites, and formulating effective go-to-market strategies.

The extended partnerships involve Memoranda of Understanding (MOUs) with prominent seafood industry players: Mitsubishi in Japan, Pulmuone in South Korea, and Thai Union in Thailand. These companies have established themselves as influential figures in the global seafood sector.

Lou Cooperhouse, president and CEO of BlueNalu, said, “We are honoured to deepen our collaborations with Mitsubishi, Pulmuone and Thai Union, visionary partners who share our commitment to driving innovation and shaping the future of the seafood industry. These extended partnerships in the APAC region underscore our dedication to working collaboratively with local experts in each region that we target, and our ultimate goal to provide our customers with healthy and trusted seafood options that have superior product benefits and align with evolving market conditions.”

The reaffirmed partnerships, which were initiated with Pulmuone in 2020 and with Mitsubishi and Thai Union in 2021, demonstrate a mutual dedication to advancing the commercialization of cell-based seafood in Asia and a joint commitment to sustainable seafood solutions aimed at addressing the growing demand for such products.

European frozen food giant Nomad Foods to shut down manufacturing plant in Bosnia and Herzegovina

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October 10, 2023

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Nomad Foods, the European provider of frozen food products, intends to shut down a manufacturing facility located in Bosnia and Herzegovina.

According to a statement from the owner of the Iglo and Aunt Bessie’s frozen food brands, the facility in Čitluk is scheduled to cease operations starting on December 1st. The closure of the plant will unfortunately lead to the termination of 52 jobs.

UK-based Nomad Foods acquired the plant in 2021 as it ventured into the ice-cream category for the first time through the purchase of frozen-food assets from Croatia’s Fortenova Group, encompassing the Ledo, Ledo Čitluk, and Frikom product lines.

The spokesperson also verified that the facility manufactures frozen fish, fruit, and vegetable products under the Ledo brand. Additionally, they mentioned that all other product variations for the Bosnia and Herzegovina market are sourced from Ledo in Croatia and Frikom in Serbia.

In 2019, Fortenova emerged as the successor to Agrokor, which had previously held the title of the largest consumer-goods company in the Balkans until it was placed under state administration in 2017.

The spokesperson for Nomad Foods emphasized that the company’s top priority is to provide support to all colleagues directly affected by this decision. This decision was reached after thorough and deliberate consideration regarding the future of the Čitluk factory.

The New York-listed business added in the statement, “Products for the Bosnia and Herzegovina market will continue to be produced at our other manufacturing sites in Croatia and Serbia.

“We employ approximately 3,500 people across the Adriatic markets, including several hundred employees working in areas including logistics, sales, marketing and support functions who will continue to be based at Ledo offices in Bosnia and Herzegovina.”

The spokesperson confirmed that Nomad Foods operates four additional regional plants in Croatia and Serbia. However, they declined to specify the exact reason for the closure of the Čitluk site.

Upon acquiring frozen-food assets from Fortenova in 2021 for £615 million (equivalent to $749.5 million today), Nomad Foods announced that the transaction would enable the company to expand into new markets, including Croatia, Serbia, Bosnia and Herzegovina, Hungary, Slovenia, Kosovo, North Macedonia, and Montenegro.

Last year, discussions began between Noam Gottesman, the co-chair and co-founder of Nomad Foods, and his counterpart Martin Franklin regarding strategic options for the business.

During that period, Gottesman mentioned that potential options could encompass “a merger or a comparable transaction,” adjustments to the company’s “current capitalization or dividend policy,” the adoption of a new “corporate structure” for Nomad Foods, and the possibility of delisting from the New York Stock Exchange.

In 2014, Gottesman and Franklin established what was initially known as Nomad Holdings as a platform for making acquisitions. Within a year, it transformed into Nomad Foods after acquiring the European frozen-food company Iglo Group, which was followed by the incorporation of several assets from the Findus Group.

Additional deals in Nomad Foods’ portfolio include the acquisition of the Goodfella’s brand from Boparan Holdings and the purchase of Aunt Bessie’s, a UK-based frozen Yorkshire Pudding and roast potatoes manufacturer, from William Jackson Food Group.

In August, Nomad Foods released its second-quarter and first-half financial results for the period ending on June 30th. Despite a rise in revenue, the company experienced a decline in net profit.

The revenue disclosed for the quarter exhibited a 6.9% increase (8.6% organic growth) to reach €745 million ($785.5 million). Additionally, for the first half, the revenue showed a 6.3% and 8.3% rise, respectively, totaling €1.5 billion.

Adjusted EBITDA climbed 4.5% and 7.9% over the two periods to €132m and €279m.

Net profit, however, dropped 34.3% for the quarter to €49m, and was down 30.7% in the first six months of the fiscal year at €90.4m.

Sugar prices skyrocket to a 13-year high as El Niño takes its toll, FAO data reveals

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October 10, 2023

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The overall prices of global food commodities remained relatively stable in September, even though sugar prices surged to their highest point in nearly 13 years due to the influence of El Niño.

The FAO Food Index report, generated by the Food and Agriculture Organization of the United Nations, saw minimal change last month. Declines in vegetable oils, dairy, and meat prices balanced out the upticks in the sugar and cereal price indices.

The index registered a value of 121.5 points, representing a 10.7% decrease from the figure in the previous September and a 24% decline from the peak recorded in March 2022.

Sugar prices experienced a 9.8% increase compared to August, marking the second consecutive monthly rise and reaching their highest point since November 2010.

The surge in prices can be largely attributed to growing concerns regarding a more constrained global supply outlook. Initial predictions of reduced production in Thailand and India are a consequence of “drier-than-normal” weather conditions linked to the ongoing El Niño event.

The FAO’s cereal index increased by 1% compared to the previous month, primarily driven by a 5.3% surge in international coarse grain prices. Maize prices saw a 7% uptick, attributed to robust demand for Brazilian exports, reduced farmer selling in Argentina, and higher barge freight rates in the United States.

The All Rice Price Index experienced a slight 0.5% decline month-on-month in September but still stood significantly higher at 27.8% above its value from the same time the previous year. This decrease is attributed to India’s decision to prohibit the export of non-basmati white rice in July, aimed at managing the surging prices.

Vegetable oil prices saw a 3.9% decrease compared to the previous month, driven by reduced global prices in palm, sunflower, soy, and rapeseed oils.

Dairy prices continued their decline for the ninth consecutive month, decreasing by 2.3%. Additionally, meat prices experienced a slight drop compared to August, primarily due to the decline in international pig meat prices.

Dabur India ushers in a new era with a complete shift to cloud-based systems

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October 10, 2023

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On Monday, Dabur India announced its transition to a fully cloud-based operation, having effectively moved its applications from its On-Premises Data Center to the Microsoft Azure and SAP RISE platforms. Additionally, the company revealed plans to leverage cutting-edge technologies like Open AI to drive its digital transformation journey.

It also stated that adopting a cloud-exclusive strategy will greatly enhance its business resilience and enhance its offerings for retailers, partners, employees, and customers.

“Agility and business innovation are crucial to address the changing market dynamics and consumer expectations. Leveraging the power of the cloud, artificial intelligence and its strong data foundation will transform Dabur into an Intelligent, Sustainable Enterprise, with the ability to innovate new products and services faster and provide superior customer experiences. The move is also in line with Dabur’s commitment to curb carbon emissions and achieve Net Zero by 2045,” said Kaustubh Dabral, Global Chief Information Officer, Dabur India Ltd.

The leading FMCG company stated that this move will enable them to tap into real-time data insights, allowing them to swiftly and flexibly respond to changing customer and market demands. Dabur collaborated with SAP and Microsoft to achieve this transformation in a mere 10-month timeframe.

“Cloud migration is the enabler to any business transformation today. In today’s disruptive consumer goods industry, navigating unpredictable supply chains, managing ongoing macro-economic volatility, and staying one step ahead of ever-changing customer demands are key to success. Our digital-first approach will empower Dabur to drive innovation faster, exceed the industry’s pace of innovation and grow resiliently,” Dabur International Head of IT Shailendra Kumar Srivastav said.

Suba Group of Hotels expands presence with grand opening of Click Hotel in Madhya Pradesh

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October 10, 2023

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Suba Group of Hotels reached a noteworthy achievement with the grand opening of their third hotel, Click Hotel, on October 9th, in Pithampur, Madhya Pradesh. Pithampur is widely recognized as a significant industrial hub in India, designated as a Special Economic Zone (SEZ), and an integral part of the Indore metropolitan area. The location boasts exceptional connectivity through road, rail, and air, with the Devi Ahilya Bai International Airport in Indore conveniently situated less than an hour’s drive from the city.

Mansur Mehta, MD of Suba Group of Hotels said, “We are delighted to launch Click Hotel in Pithampur. With the launch of Click Hotel, we look forward to serving guests for official as well as social gatherings and stays. Click Hotel, Pithampur, perfectly embodies the brand’s core values – offering high-quality bed-and-breakfast accommodations, along with broadband (WIFI) connectivity, coupled with immaculate service and unparalleled international-standard hospitality. This ensures maximum comfort for long-stay guests, both local and expatriates. As an organization deeply rooted in India, we are also committed to sustainability and reducing our carbon footprint. We will adopt a sustainable approach by replacing plastic water bottles with reusable glass bottles and encouraging guests to reuse linen and towels. These green tourism initiatives will be implemented not only in Pithampur but also across all our other properties.”

Click Hotel in Pithampur is a chic, contemporary boutique luxury hotel that combines sophistication with affordability. It has been designed to meet the requirements of today’s business travelers, offering a comprehensive range of services. The hotel boasts 63 premium, stylish rooms and suites, as well as an in-house multi-cuisine restaurant called CINNAMON. Moreover, guests can enjoy the convenience of in-room dining, efficient service, and a wide array of amenities to ensure a comfortable and enjoyable stay. Additionally, the hotel has plans to introduce facilities like a gym and conference rooms in the near future.

Mubeen Mehta, CEO of Suba Group of Hotels said, “We are pleased to expand our presence in Madhya Pradesh with the launch of Click Hotel in Pithampur. This marks our third brand presence in the Indore-Pithampur metropolitan region. This full-service hotel, equipped with contemporary elements, is ideal for business and leisure guests, as well as flexible independent travelers (FIT) and group travelers. It is our endeavor to continue expanding our presence across popular destinations in the country, offering standard stay and culinary facilities. Like other Click Hotels in India, Pithampur will also offer the best of services, as our empathetic approach ensures guest satisfaction.”

Nestled conveniently near key industrial hubs, IIM – Indore, and just a short 45-minute drive from the heart of Indore City, Click Hotel – Pithampur presents itself as the perfect selection for individuals in search of comfort, exceptional value, standard services infused with a hint of luxury, and a sanctuary away from the hustle and bustle of the corporate and industrial landscape.

Abinash Ashok, VP of Suba Group of Hotels said, “With the launch of Click Hotel, Pithampur, we aim to extend the Click Hotel’s stay experience to all our regular Suba patrons and, especially, the new-age travelers who seek a quality stay with high-speed WiFi at prominent locations, all at dynamic rates. With the launch of this hotel, we also emphasize our commitment to reducing our carbon footprint and gradually eliminating plastic usage.”

Every property within the Group’s portfolio showcases opulent accommodations, versatile banquet facilities, and unparalleled food and beverage services. Suba Hotels is dedicated to meeting the needs of contemporary travelers by delivering a unique lodging experience, top-notch service quality, and outstanding amenities at competitive rates. With a footprint spanning major metropolitan areas as well as tier I and tier II cities, the company provides elegant and roomy accommodations, perfect event and wedding venues, and a remarkable dining experience at their renowned restaurants.

ITC Hotels expands ‘Storii’ portfolio with new boutique resort in Kolkata

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October 10, 2023

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ITC Hotels on Monday announced the signing of its first ‘Storii’ property in Kolkata, West Bengal. The property will be located near the metropolis and is slated to open in early 2024.

According to a company spokesman, ITC Hotels already has three ‘Storii’ properties which are presently operational in Goa and Dharamshala.

The Kolkata property will have 30 keys, the spokesman said.

Anil Chadha, divisional chief executive of ITC Hotels, said “ITC Hotels has a strong presence in Kolkata. The ‘Storii’ property will be a boutique resort away from the hustle and bustle of metro life.”

ITC’s Storii hotels are boutique establishments, each characterized by a distinct ‘narrative’ stemming from its architecture, location, historical significance, thematic elements, or the amenities it provides.

Ravi Todi, director, South City Projects (Kolkata), said that this is the first hospitality venture of the property developer which will bring a world-class boutique resort with a Spa.

Nykaa must boost ad-spending to hold market shares amid rising competition

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October 10, 2023

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Amid the intensifying competition in the offline and online beauty and personal care (BPC) industry, analysts at Kotak Institutional Equities assert that Nykaa will need to continue investing in advertising to safeguard its market share.

The brokerage highlighted in a report the expanding user base of Purplle and the prospective competition posed by Reliance’s Tira and Tata Cliq.

“Beauty products aggregator Purplle has been witnessing a stronger increase in app MAU (monthly average user) compared to Nykaa. While the overall positioning of the two players is different, there is a divergence in user trends,” said the brokerage.

According to Kotak, Nykaa experienced a notable decline in its Monthly Active Users (MAU) by over 20% year-on-year (YoY) in August, reaching 6.7 million, while Purplle’s MAU surged by 60% YoY to reach 4.8 million. Furthermore, Nykaa’s website visits dropped to 10.9 million in September, marking a 16% month-on-month (MoM) decrease, whereas Purplle witnessed a 26% YoY decline to 3.2 million, as per the brokerage’s observations.

Kotak reported that metrics indicate Purplle has already secured approximately one-third of Nykaa’s monthly website visits.

“Purplle has caught up with Nykaa’s high organic search traffic share. Upstarts such as Tata Cliq Palette and Tira Beauty are using paid search channel to garner traffic on the platform,” the analysts said.

Nonetheless, the analysts hold the belief that the recent entrants, Tata Cliq Palette and Tira Beauty, may not have substantially eroded Nykaa’s market share.

Nevertheless, the increasing offline presence of all beauty and personal care (BPC) brands has heightened competition even more.

“Offline BPC retail is also witnessing heightened competition, with Tira and Palette entering the fray and Trent (Misbu) as well as Shoppers Stop planning to increase their footprint. Nykaa may have to keep up ad-spends to retain market share,” the analysts added.

Kotak’s report follows Nykaa’s Q2 FY24 performance update released last week, where the company anticipated a roughly 20% year-on-year (YoY) increase in its Beauty and Personal Care (BPC) net sales value (NSV) for the quarter. Conversely, Nykaa projected a YoY growth of approximately 30% in its fashion vertical’s NSV.

Kotak noted that Nykaa’s fashion business NSV outlook surpasses the brokerage’s projections, but the 20% growth in BPC NSV falls short of their expectations.

Additionally, the brokerage had forecasted a consolidated revenue growth of 24% year-on-year (YoY) for Q2, whereas Nykaa provided guidance indicating growth in the early 20s.

In Q2 FY23, Nykaa’s net sales value (NSV) for its Beauty and Personal Care (BPC) segment amounted to INR 981.5 Crores, while the NSV for its fashion vertical was INR 175.3 Crores.

Yesterday, Nykaa’s shares witnessed a 1.5% decline during the trading session, concluding the day at INR 147.15 on the BSE.

Swiggy and Zomato face disruptions in Mumbai as delivery workers strike for improved conditions and incentives

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October 10, 2023

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The operations of prominent food delivery platforms Swiggy and Zomato experienced disruptions in various areas of Mumbai on Monday due to a strike by delivery workers. Their demands included increased incentives and improved working conditions.

The strikes, which began on Sunday, are being coordinated by several organizations, including the Shiv Sena-affiliated Rashtriya Karmachari Sena and the Indian Federation of App-based Transport Workers (IFATW).

Shaik Salauddin, the national general secretary of IFATW, stated that thousands of delivery workers from Swiggy and Zomato participated in the strikes.

Numerous users turned to social media to express their grievances about service interruptions. One user posted on the microblogging platform X (formerly Twitter), saying, “Hello @Swiggy @SwiggyCares, if your riders in Mumbai are on strike why are you accepting orders? My order has been stuck for over 90 minutes and is not getting cancelled.”

Requests for comments on the strikes went unanswered by Swiggy and Zomato.

The delivery workers are calling for improvements in various areas, such as fair distribution of orders and workloads, optimizing pickup and drop distances, providing comprehensive insurance coverage for both workers and their families, and ensuring equal access to incentive programs.

IFATW has advocated for the introduction of a ‘Social Security Bill’ for gig workers in Mumbai, akin to a recent legislation passed by the Rajasthan government. Additionally, it has urged the establishment of a “tripartite board” comprising representatives from aggregators, worker organizations, and the government to oversee worker-related schemes. Furthermore, IFATW has called for ecommerce platforms to contribute a “welfare cess” to fund a collective fund dedicated to gig workers.

Salauddin expressed concern, stating, “We know of about 3,500 delivery partners whose IDs have been deactivated by platforms, not just in Swiggy and Zomato but across platforms, due a variety of reasons that were beyond their control, like bad weather or packaging issues or wrong location. This kind of deactivation without verification or bargaining is very harmful for workers.”

He mentioned that the striking workers were in discussions with delivery personnel from other companies, such as Zepto, to potentially join their protest. However, he refrained from providing a specific timeline for the duration of the strikes, emphasizing that they would continue “as long as they do not adversely affect the well-being of the workers.”

In April, delivery workers employed by Blinkit, a quick-commerce platform owned by Zomato, initiated a strike in response to the company’s alteration of its payout system. The change shifted from a fixed rate of INR 25 per delivery (plus an additional INR 7 during peak hours) to a minimum fee of INR 15 per delivery, supplemented by a distance-based component.

The Rajasthan Assembly passed the Rajasthan Platform-Based Gig Workers (Registration and Welfare) Bill in July 2023, making it the first law of its kind in the country aimed at protecting gig workers.

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