AAK invests US$32m in expansion of its production facility in China

CHINA – AAK, supplier of vegetable oils and fats for specialized products has said that it will invest US$32 million (SEK 300 million) at its production facility in Zhangjiagang, China.

The company said the investment will seek to increase capacity and support volume growth with a focus on Special Nutrition and Bakery segments.

The investments include a stand-alone processing plant for Special Nutrition, focusing on the production of infant nutrition specialty solution INFAT, sold through Advanced Lipids, a joint venture between AAK and IFF.

AAK will also add additional capacity in the Bakery segment to meet the strong demand for the company’s high-end bakery solutions.

Furthermore, AAK will invest in some base production equipment and infrastructure to accommodate the general domestic growth, according to the company.

“China is a key growth market for AAK, and the country will continue to present attractive opportunities for profitable and sustainable growth in the specialty and semi-specialty vegetable oils and fats market,” said Johan Westman, AAK President and CEO.

“AAK has established a solid presence in the Chinese market and with these new investments we are very well positioned to continue to grow organically and capture market share.”

The investments are expected to be commissioned during the second half of 2020.

The Zhangjiagang production site was inaugurated in September 2017 with an annual production capacity of 100,000 MT.

“The processing plant for Special Nutrition will significantly strengthen the product and service offering for end-customers,” said Torben Friis Lange, President AAK Asia.

“Combined with the investment related to our high-end bakery solutions, we will support our long-term growth in the fast-growing and significant Chinese market.”

In October last year, AAK opened a new Customer Innovation Center in Singapore to strengthen its capabilities in the Southeast Asian market.

Located at Biopolis, the center focuses on applications within bakery, ice cream, dairy and special nutrition, housing research laboratories of pharmaceutical and biotechnology companies as well as public sector research institutes.

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