Carbery excited about Brazilian joint venture
The 50:50 joint venture will use Carbery’s innovative technology to process whey generated at BRF’s cheese-making operations. The plant will be operational by 2014. BRF, which employs 115,000 people and has an annual turnover of $13.7 bn (€10.8bn), and is the second largest collector of milk in Brazil.
Together with significant pork and poultry operations, BRF has 14 dairy processing sites in Brazil together with one in Argentina and processes in excess of 1.6bn litres of milk per annum. BRF’s portfolio includes cheese, UHT milks and fresh dairy products marketed under the Batavo and Elege brands.
Carbery chief executive Dan MacSweeney said: “This joint venture with one of Brazil’s leading food companies further enhances our footprint in the vast agri-food business in South America.
“Carbery’s capability to produce high quality whey protein ingredients in the country will strengthen our offerings to the leading nutritional brands there, and ensure we are positioned for further growth in a dynamic and growing economic region.”
BRF chief executive Jose Antonio Fay added: “There are many synergies between our two companies and we are delighted to partner with Carbery Group on this joint venture initiative.
“They are renowned for their service and technological capability, putting their customers at the centre of projects large and small, and offering world-class quality and innovation. We were also impressed with their proven success on an international scale, and look forward to working with them.”
Carbery Group’s senior executives are understandably upbeat about the joint venture. BRF is a major player in Brazil, the world’s sixth largest economy and home to 190m people.
Brazil has a rapidly expanding middle class. It also has a highly evolved approach to sustainability, with 80% of the nation’s electricity coming from hydro power and with sugar playing a key role in its transport fuel. BRF’s focus on sustainability also ties in well with Carbery’s own programmes in this area.
Carbery operations director John Holland said: “BRF has a national sustainability programme in place. By next year, every single dairy producer will be audited for their sustainability programme.
“We also run an extensive sustainability programme at Carbery, and we are very conscious of our carbon emissions. Our plan is to reduce our carbon footprint by 20-25% during the next five to ten years.
“Our farmers are already carrying out a lot of energy-saving initiatives of their own. They realise that this kind of efficiency also makes business sense.”
In Ireland, the Stockbroker reaction to Carbery’s joint venture with BRF has been very positive.
The expectation is that the West Cork company is likely to look to further partnerships and acquisitions as part of its international growth ambitions.
Carbery has significant operations in the USA, Brazil, UK and Thailand, as well as its headquarters in Ballineen, Co Cork. This latest Brazilian venture has also been widely welcomed by Carbery’s Irish shareholders.
Dan MacSweeney noted: “By growing our presence in emerging markets like this, Carbery is adding value to its core business in Ballineen, and our other international facilities, in a steady and planned way, while demonstrating our ability to compete and succeed in world markets, using world-class process technology.
“Our R&D capabilities here in Ireland are crucial to our offering, and we are truly confident of further growth and development opportunities into the future.”
Carbery, which enjoyed a turnover of €257m in 2011, employs over 500 people globally with 200 in Ireland and is a leading player in the manufacture of whey-based ingredients internationally, brought about by significant investment in research and development, principally at its centre of excellence for nutrition in Ireland.
The outputs of this long term R&D programme has led to the development of a range of advanced dairy based nutritional ingredients which are supplied to many of the world’s leading international food and drink companies.
Many of the world’s leading consumer brands in baby food, sports and performance nutrition, together with foods such as yoghurts and bakery products, contain Carbery proteins which are recognised globally for their high quality and efficacy.
The new operation will house a state of the art manufacturing plant to produce added value nutritional ingredients sourced from whey. The construction of the processing facility is planned to commence immediately and it will be commissioned in 2014.
Carbery’s John Holland added: “We have been operating in Brazil since 2007 through Synergy, its international flavour and taste business, which is building a reputation for the supply of high quality flavour ingredients to many of the major food and drink companies operating in that rapidly growing market. Recently we opened a new flavour manufacturing and technical development centre close to Sao Paolo which will further enhance our market presence in Brazil.”
BRF’s dairy technical director, Peter Bosch, concluded: “We know of Carbery’s long standing reputation for innovation in whey processing and together with BRF’s dairy technology capabilities and consumer reach we are forming a partnership which will deliver long-term value to the suppliers and shareholders of the venture partners.”
