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Nestle Bangladesh opens Tk. 150 Crore infant formula plant

Bilal9

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12:00 AM, June 17, 2021 / LAST MODIFIED: 11:22 AM, June 17, 2021



Star Business Report

Nestle Bangladesh yesterday started processing, filling and packaging the company's infant formula at its Tk 150 crore factory in Sreepur, Gazipur.

The state-of-the-art plant with an annual production capacity of 6,000 tonnes will create around 1,000 direct and indirect jobs.

At the primary stage, Lactogen 2 and Lactogen 3 will be processed there. Later, Lactogen 1 and Nano would be processed.
Some 34 factories in the world have this kind of plant and Nestle Bangladesh joins this league with this plant.

Industries Minister Nurul Majid Mahmud Humayun inaugurated the plant through an online programme where Md Sirazul Islam, executive chairman of Bangladesh Investment Development Authority (BIDA), was also present.

Nestle Bangladesh kept its commitment of establishing the plant in the country, the minister said.
"I had a discussion with the Nestle leadership in Switzerland about the world-class factory."

Bangladesh is the fastest growing economy and investing here is profitable, the BIDA chairman said.

"Now, entrepreneurs can get relevant approval easily online. So, I request all to invest in Bangladesh."

Around 10,000 tonnes of infant formula is sold in Bangladesh every year and Nestle holds 55 to 60 per cent of the market share with its two brands Lactogen and Nan.

The company has been selling its products in Bangladesh for more than 26 years.

"Driven by purpose and touching the lives of millions by addressing their daily nutritional needs, we take pride in bringing nutritionally superior products to people of Bangladesh with the highest standards of safety and quality in our world-class facility at Sreepur factory," said Deepal Abeywickrema, managing director of Nestle Bangladesh.

"Our products supply and price would be sustainable, so people will not face any issues suddenly when the international market price changes," said Naquib Khan, corporate affairs director of Nestle Bangladesh.

"On the other hand, our foreign currency will also get comfort for the value to be added here."

Suresh Narayanan, market head of Nestlé for South Asia region, and Arshad Chaudhry, nutrition business head of Nestlé for Asia, Oceania and Africa, also spoke at the event.
 

Vapnope

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I really hope that Bangladesh gets the processing and supply chain till the milk farm as for now it looks like that raw material (semi finished) are being procured and then after recipe creation being packages.

We also got a plant from Morinaga for infant formula milk and we plan to reach til the milk farm in next 5 years.
 

Bilal9

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I really hope that Bangladesh gets the processing and supply chain till the milk farm as for now it looks like that raw material (semi finished) are being procured and then after recipe creation being packages.

We also got a plant from Morinaga for infant formula milk and we plan to reach til the milk farm in next 5 years.
Yes brother - you are talking about backward integration I am guessing. By the way Morinaga powder milk was very popular in Bangladesh back in the day. Nowadays most of the powder milk comes from Denmark (DANO brand) and New Zealand (Anchor brand). Condensed milk powder is imported in bulk chunks (almost hard like stone) and re-powdered (re-packed) locally by those investors.

Bangladesh is not a huge milk producer like Pakistan so it will take time. Genetically - a large portion of Bangladeshis are lactose intolerant because cow-herding or goat-herding was not a traditional activity historically in our area. Although India and Pakistan recently became self-sufficient in milk, Bangladesh did not, for this reason. Yogurt based drinks are more popular here, compared to fresh milk, which is mainly given to children.

Lately though, a lot of large dairy firms (akin to Western practice) and pasteurization plants have been established and more are in the pipeline. Milk production has reached 10 Million tons per year against a demand of 15 million tons/year which is met by powdered milk imports. Pakistan's production at this time is I believe about 2.5 times that of Bangladesh, 28 Million tons/year (4th largest producer globally).

Two large Dairy farms,

Dutch Dairy in Munshiganj near Dhaka (1100 heads)

Nahar Dairy Chittagong (1500 heads)

There are several large dairy pasteurization and retail vendors of milk products such Milk Vita, Aarong and Pran.



A recent forecast says that it will take until 2030 to reach self sufficiency in dairy products, which is a realistic goal. At that time demand and production will be around 17 million tons/year.

http://www.lrrd.org/lrrd32/5/moham32081.html

 
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bd_4_ever

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Swiss companies, doing it the Swiss way! ;)

Never had any doubt on Nestlé. One of the most stable companies on planet earth. There is a saying in the share market, 'you can never go wrong with a Nestlé stock'!

This reminds me of my visit to their HQ twice in the beautiful town of Vevey by Lac Léman. We worked on a machine learning case for Nestlé and presented a well-received solution to their Global Supply Chain team. Was a fantastic experience.

Very happy to see them taking the Bangladeshi market more seriously.
 

Bilal9

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Swiss companies, doing it the Swiss way! ;)

Never had any doubt on Nestlé. One of the most stable companies on planet earth. There is a saying in the share market, 'you can never go wrong with a Nestlé stock'!

This reminds me of my visit to their HQ twice in the beautiful town of Vevey by Lac Léman. We worked on a machine learning case for Nestlé and presented a well-received solution to their Global Supply Chain team. Was a fantastic experience.

Very happy to see them taking the Bangladeshi market more seriously.
I can vouch for Nestlé as well. Their brands in the US are all top performers. And they run a super clean ship in their US headquarters too. Their US HQ is not far from where I live - in Pasadena, CA. Used to have friends who worked there and heard many stories.

Yes it is great news Nestle started to expand here, we can have people trained there and these people in turn can open up their own outfits by benchmarking Nestlé best practices.

By the way the other Dairy juggernaut is Danone, which has a JV with Grameen. As per capita income goes up, Danone will expand locally as well for yogurt based drinks and yogurt itself, which has been available now for a while in frozen clean international sealed plastic pkgs. instead of in unhygienic terracotta pans from sweet shops.

And Self-Serve Frozen Yogurt dispensed out of machines is also getting quite popular (along with Premium Ice Cream like Cold Stone Creamery) - that is a massive utilization of milk too, targeted at the trendy younger populace. Hope these really take off as snacks.



 
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Bilal9

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Lactogen is being formulated locally in Bangladesh. Video with a senior Nestlé Official. he say local value addition is around 35%.


Nestlé Bangladesh has set up a Lactogen infant milk formula factory in Gazipur with an investment of Tk.150 crore, capable of producing 6,000 tonnes of baby food a year.

Naqib Khan, Director of Corporate Affairs at Nestle Bangladesh, has joined TBS to talk about this. He also shared some personal memories of his musician life.

Nestlé , a multinational food manufacturing company, has set up a state-of-the-art 'Infant Formula Processing, Filling and Packaging Plant' in Bangladesh to strengthen its influence in the country's baby food market.

From now on, the company will produce their Lactogen brand baby food in Bangladesh.

Officials at Nestle Bangladesh said they had started production of only Lactogen-1 and Lactogen-3 at a Tk.150 crore factory in Sreepur, Gazipur, since Wednesday.

Initially, the factory will produce 6,000 tons of Lactogen a year. As they gradually increase their productivity, they will start producing the remaining variants of Lactogen.

Naqib Khan, Director (Corporate Affairs), Nestle Bangladesh Limited, said, “Infant formula will be processed, filled and packaged in the new factory after bringing in large quantities of products; This will alleviate the crisis of baby food supply and provide employment opportunities to 1000 people directly and indirectly.

He added that processing in Bangladesh would add 30-35 per cent value to Nestlé products, which would save a huge amount of foreign exchange.

According to various sources, a large part of the 4,000 crore yearly baby food market in Bangladesh is in the hands of Nestlé .
 
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