Faragalla to continue expansion drive, says chairman

By Eliot Beer

- Last updated on GMT

© iStock / Digital Storm
© iStock / Digital Storm

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Egyptian food producer Faragalla will grow its milk, tomato and frozen vegetable lines this year, following US$200m of investment in 2015, its chairman told FoodNavigator.

Faragalla, one of Egypt’s largest food producers, saw rapid expansion last year, according to its chairman and founder Mohamed Farag Amer, as it brought in new lines for croissants, juice, biscuits and its Pulpy and Milky drinks among others. But Amer said the firm’s growth plans were not finished yet.

‘We must keep going’

There are some parts we must keep going on. It depends on the demand – we will invest a lot of money for milk. We have a very successful milk product, and we cannot cover our demand. Also in tomato, we will very soon have a factory for tomato in cans. And very soon again, we will double the capacity of our frozen vegetable factory​,” said Amer, speaking at last month’s Gulfood exhibition in Dubai.

He said the company’s exports operations were becoming more challenging, in part because of issues with the Egyptian economy. “It’s not easy, but we sell all over the world. It’s getting more and more difficult, but we’re still doing our best for them​.”

While Egypt has seen a resurgence in investment in recent years, thanks to a more stable political climate, shortages of foreign currency reserves and controls on foreign exchange transactions have made doing business with Egyptian companies challenging. Last month new rules on imports were due to come into force​, speculated in part to help reduce demands on forex reserves.

From his side, Amer says Faragalla is Egypt’s largest food exporter and exports to 130 countries around the world, including the US and countries in Western Europe, with organic products of particular interest to buyers in the west. At Gulfood, Amer said buyers were particularly interested in juice and frozen vegetables – but that their true interest would only become clear after the exhibition.

Croissants, jam and cheese

Faragalla’s expansion last year was significant according to Amer, and included two new croissant lines with a capacity of 75,000 pieces an hour each, along with new jam capacity of 45,000 pouch portions an hour. The company also added six new Tetra Pak lines, taking its total to 30, and two automated lines for producing cheese triangles – with production of smoked cheese coming soon.

Late last year the European Bank for Reconstruction and Development announced it had agreed a US$25m loan to Faragalla, to help fund its expansion plans.

Despite the sometimes challenging environment, Amer said he was hopeful for the future: “I hope the economy world-wide will improve, because this is good – when people have more business, they are quiet. I hope that all the wars in the Middle East to be finished, for people to live in peace and be busy, for unemployment to go down, the economy to be improved. This is my hope, and I’m trying to do my best for that​.”

Related topics Middle East

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