Karlshamns extends Swedish plant to up pumpable fat supplies

Related tags Fat Karlshamns

Swedish speciality fats and oils firm Karlshamns builds up supplies
of pumpable fats and liquid margarine as industry spikes demand for
convenience fats, reports Lindsey Partos.

The Karlshamn-based firm has built a plant within a current plant to ramp up production of its range of bakery-targeted fats sourced largely from rape seed and palm oil.

Priced in the same bracket as solid equivalents, the company claims users will ultimately make savings through economies in production.

The convenient delivery means users do not have to unwrap the product, or melt-down the fats, which saves on time and handling expenses, a spokesperson for Karlshamns tells FoodNavigator.com.

Spearing the bakery segment, the company delivers the liquid margarine or pumpable fats in one tonne containers or 10 tonne tanks with the plant extension servicing the west and central Europe. For the moment, this is the only facility of its kind within the €372 million Stockholm-listed group.

The new production facility will also serve as a platform for extending the firm's product range. "The new plant offers entirely new potentials, in particular so when it comes to biscuit fats - a recently developed product for the bakery industry. We are also in a position to customise products by adding flavourings to the pumpable fats,"​ commented Håkan Christensson, president of the edible oils sector at Karlshamns.

Competitively positioned, ccording to the spokesperson, there are trans fat free alternatives for the liquid margarine and pumpable fats as food developers, and the market, turn away from formulations with artery-clogging trans fats.

The company which saw its profits slip at the end of 2003, will be looking to the plant extension for new gains in the so-called value-added fats and oils sector.

A strategy that drove the firm to recently acquire UK flaked fats company Kelanco, and with it a move into speciality fats for the booming UK convenience food market.

The €1.6 million deal, concluded in September, gives Karlshamns its first production facility for flaked fats, adding to the flaked fatty acids and flake feed materials currently in the Swedish company's portfolio.

"We already have a plant for powdered fats, the Kelanco purchase and its UK production base complement this,"​ a spokesperson for the company said to FoodNavigator.com at the time.

After profits for the group slipped to SK106 million (€11m) from SK109 million for the first nine months up until 30 September 2003, the firm said at the end of last year it would be looking to focus on high-margin, value-added products to kick back the bottom line.

Tough competition, particularly from across the Atlantic, has seen US giants eating into the European market for oils and fats. Last year the world's number one oilseed processor US Bunge acquired French rival oilseed processor Cereol - the parent of ingredients company Central Soya in a move that gave it access to key operations in Europe.

"Hardening competition in the vegetable oil industry had negative effects on the oils & fats contribution margins,"​ commented the president of the firm, Jerker Hartwall, last year.

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