IDB Makes €20 Million Investment in Saudi Arabia
31 Oct 2013 --- The Irish Dairy Board Cooperative Limited (IDB) has today announced a €20 million investment in Saudi Arabia. The investment includes the acquisition of a 75% interest in Al Wazeen Trading LLC (Al Wazeen) and the development of a new state of art cheese manufacturing plant at the Al Wazeen facility in Riyadh.
The investment will further strengthen IDB’s position in the Saudi Arabian market, the fifth largest dairy importer in the world, as well as providing a central hub to access the important dairy growth markets in the MENA region.
The announcement was made by Kevin Lane, CEO, IDB during the Irish Trade Mission to Saudi Arabia, led by the Minister for Agriculture, Food and the Marine, Mr Simon Coveney, TD.
Welcoming the announcement at the Ceremony in Riyadh to launch the IDB and Al Wazeen development, Minister Coveney said: “Developing new routes to market, in particular the emerging markets, is a crucial component of our strategy under Food Harvest 2020 and today’s announcement represents just that. The IDB’s investment in Saudi Arabia opens up considerable market opportunities for the additional milk we are expecting post 2015. I’d to like congratulate the IDB and Teagasc on the success of their collaborative partnership that clearly demonstrates how business and science can work together to achieve commercial success.”
The new facility will use dairy ingredients to produce a range of fresh white cheeses that appeal to local market tastes. The cheeses will be made using a pioneering technology developed by the IDB and Teagasc. The technology allows innovative milk protein ingredients to be recombined for fresh white cheese production. Fresh white cheese is hugely popular in the Middle East. The facility will also include an Innovation Hub for the continued research and development of ‘white cheese’ technologies.
The facility will initially supply dairy products to the Saudi Arabian market. It is anticipated that IDB will use Saudi Arabia as a manufacturing hub for the MENA region, supplying the Islamic Halal market segment. Saudi Arabia already imports more than 400,000 tonnes of dairy produce per year. Domestic milk self sufficiency is relatively low and milk production is under stress due to the lack of water for crop growing as animal feed. Despite this, consumption of cheese and other dairy products is growing steadily throughout the region, offering an excellent platform for future growth for IDB.
This investment is a key part in IDB’s strategy to grow routes to market and added value for Irish dairy produce in the run up to the abolition of milk quotas in 2015.
Commenting on the announcement Kevin Lane, CEO, IDB said: “Today’s announcement represents a major route to market and value for Irish dairy in the post quota environment. This investment is strategically very important as it allows us to expand our business throughout the MENA region. With innovation and new product development being critical to growth, our partnership with Teagasc is an excellent example of how with innovative technologies we can create new ways of producing and selling dairy products for a global audience.”Professor Paul Ross, Head of the Teagasc Food Research Programme said: “Teagasc is delighted to be collaborating with the Irish Dairy Board in applying the technologies developed in the food research centre in Moorepark, to develop fresh cheese types suitable for markets in the Middle East. The ambition of the collaboration is to continue to develop a pipeline of new innovative products to meet specific consumers and customer needs in key global farmers for the Irish Dairy Board. This will contribute to the returns farmers receive for the milk they produce.”
