Bread’s future is far from flat for Novozymes in the Middle East
Novozymes, the Danish food technology major, has been looking at products like the flat bread to assess where its fortunes lie as its ramps up business there.
“We think this part of the world is interesting," says Rasmus von Gottberg, the company’s head of food and beverages.
“Baking is very big, and certainly in this part of the and it’s of great interest to us. Flat bread is a type of bread that prevails here and we see opportunities in that.”
Flat bread sums up the opportunities for companies like Novozymes, which place a strong emphasis on health and sustainability.
In a wasteful region, bread is served at every meal, often in vast quantities. It comes in huge piles at Arabic restaurants, with much of it left uneaten. Anyone passing a dumpster in a Gulf city couldn’t fail to see large quantities of bread rotting inside.
“There are specific opportunity areas when it comes to flat bread. And there’s the dimension that goes into reducing waste,” Von Gottberg continues.
If you can keep the bread naturally fresh for longer, you can reduce that waste, he says, adding that Novozymes has the technologies to do that.
“I’m not suggesting that these are all right and ready—there’s some already in the marketplace, but it’s something we are attentive to focus on.”
Indeed, the company is ramping up its Turkish laboratories to target the baking business, and specifically new flat bread ingredients. These are expected to come on line in the first quarter next year.
For more details on this, we “just need to be patient,” Von Gottberg adds.
Sugar is another area that has been exercising Novozymes in its approach the the Middle East—again with flat bread manufacturers standing to benefit from its technologies.
If bakers can reduce the amount of sugars in their products, that’s not a bad thing from a health point of view. And sugar, of course, has a function in preserving, so you’re back again to keeping it fresh and preventing waste in the Middle East.
“These things go hand in hand, so that represents an interesting opportunity,” says the Novozymes executive.
The company is not new to the Middle East; rather its desire to tap into a growing market is mounting, especially now that Von Gottberg and his colleagues have assessed that some of the region’s economies have reached a point that is vital for business.
“If you look at parts of the Middle East, you will see significant economic development, and if you relate it to our technologies, you could say that they go hand in hand with GDP per capita growth, and certain thresholds being passed,” he says.
“It isn’t that we haven’t been present; we have been here for a long time. But we are seeing significant acceleration in interest, and also in relevance because, for example, of the industrialisation of the region.”
This economic development has spawned the growth of a peculiar customer: the family-owned, entrepreneurial conglomerate, which plays a significant role in driving business in the Middle East.
These are very important for companies like Novozymes as their sheer size and understanding of the various layers of industrial supply lead them to become a catalyst for wider, less evolved segments of the market to develop in their own right.
This can “build momentum in the industrialisation of their support platforms,” Von Gottberg says. Moreover, they have been instrumental in driving safety considerations and product quality—often areas that had been overlooked during the region’s earlier stages of economic growth.
“Just as we have seen in Southeast Asia before, these companies, based on location and regional market understanding, are becoming significant businesses, including driving sustainability agendas. You see that in the Middle East. And those would be important players for us to engage with, for them to understand what our product technologies are doing.”
And, as so often seems to be the case, it all boils down to flat bread. As growth, driven by industrialisation, GDP income and consumer demand make the region a viable market for Novozymes, pita stands out, Von Gottberg points out.
“It’s eaten all the way from India to Morocco—and that’s a big part of the world. Of course it’s bound to take our interest,” he adds.