US cereal major Kellogg is building a new, RM425m (US$130m) halal snacks manufacturing facility in Malaysia, having chosen the Southeast Asian nation site as part of a recently announced four-year efficiency and effectiveness programme.
The new facility, in Bandar Estek, Negeri Sembilin, will increase Kellogg’s production capacity across Asia-Pacific markets. It is expected to create at least 300 local jobs when the first phase is completed by the middle of next year.
Government congratulates itself
Prime Minister Najib Razak, who launched the ground-breaking ceremony, got in on the act by proclaiming the plant an example of how the Malaysian government’s policy to attract multinational investors to the country has been a success.
Referring to the recent World Bank Doing Business 2014 report, in which Malaysia had surged to the sixth position out of 189 economies, Razak said: “If we were not a pro-business and pro-investment government, the World Bank would not have evaluated Malaysia as the sixth most friendliest country to conduct business.”
"Perhaps, it is difficult to imagine but in 18 months, consumers in Japan and South Korea will be enjoying their Kellogg cornflakes breakfast manufactured in Malaysia.
"For us in Malaysia, we also aspire to transform our nation to become a developed high-income economy and this would probably be reflected in lifestyle changes in our breakfast menu.”
The plant will produce halal-certified Pringles crisps, and is only the second such facility in the region. Kellogg’s Asia-Pacific president, Amit Banati said the Negri Sembilan factory will complement Kellogg’s other halal facility in Thailand.
“This is a big step for us in ensuring that we stay relevant and expand our supply chain capabilities. Building a new facility highlights the focus and commitment that the Asia-Pacific region is receiving from Kellogg company,” he said.
John Bryant, Kellogg’s president and chief executive, said the company’s acquisition of Pringles in 2012 marked the beginning of an exciting new era in the evolution of our global snacks business.
“The decision to invest in a new snacks manufacturing facility—and build our capacity and capability in Asia-Pacific—is the next step in that journey,” he said
“We have a compelling business need to better align our assets with marketplace trends and customer requirements.
“To that end, we are taking action to ensure our manufacturing network is operating the right number of plants and production lines—in the right locations—to better meet current and future production needs and the evolving needs of our customers.”
Kellogg’s is the world’s largest manufacturer of ready-to-eat breakfast cereals and second largest producer of savoury snacks, biscuits and crackers. The company employs more than 2,200 employees in Southeast Asia, Japan, Singapore, Australia, New Zealand,
Thailand, India, South Africa, China and Malaysia.