De Heus Animal Nutrition acquires ADM’s compound feed operations in Indonesia

INDONESIA – Dutch animal nutrition company, De Heus Animal Nutrition has completed the acquisition of the compound feed operations of Neovia Indonesia (PT Welgro Feedmill and PT Wirifa Sakti) from ADM.

The acquisition further strengthens De Heus’ position in Indonesia with two compound feed mills located in West-Java and East-Java that generated total sales volume of 125,000 tonnes in 2019. Neovia Indonesia focus mainly on the poultry, aqua and swine feed segments.

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It is estimated that the size of the animal feed market in Indonesia will increase from 19 million tonnes in 2019 to 22 million tonnes by 2022. Indonesia’s current population is 273 million, making it the largest consumer market for proteins in Southeast Asia.

The demand for animal proteins will continue to increase over the coming years due to the growth in disposable income and population as well as the change in consumer preferences.

De Heus made it entry in the Indonesian feed market in 2018 through the acquisition of PT Universal Agri Bisnisindo (UAB) in Bekasi, West Java. Gabor Fluit, Business Group Director De Heus Asia said that the new acquisition will accelerate the company’s growth strategy in Indonesia.

“It gives us an excellent opportunity to expand our position in key livestock and aqua farming areas, close to our existing and potential new customers,” Fluit said.

Fluit says that since the UAB acquisition, De Heus has replicated its successful market approach developed in other Southeast Asian countries, by supporting professionalisation of independent farmers in the local livestock and aqua farming sector.

“In addition, we have improved production processes, invested in technical training of personnel and started construction of a new production line for aqua and poultry feed at the existing UAB feed mill,” Fluit says.

Kay De Vreese, President Director De Heus Indonesia added the company will continue to implement its investment plans over the coming years. He noted that Welgro and Wirifa will be aligned with De Heus standards so as will create a strong and unified De Heus organisation in Indonesia.

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“We are very pleased to welcome the Welgro and Wirifa employees as new colleagues to De Heus in Indonesia. We have come to know Welgro and Wirifa as dynamic companies with a focus on continuous improvement, which is an excellent fit with De Heus’ company culture,” Kay De Vreese commented .

“The coming year will be an important transition period. We will identify the investments needed in the production processes to improve product quality and increase production capacity.

“We will also continue to assess potential opportunities to strengthen our position in the value chain, both organically and through acquisitions.”

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