Swedish producer of vegetable oils and fats solutions AAK has outlined plans to build a specialty and semi-specialty edible oils factory in China, with an estimated outlay of about $56.34m.
To be built in Zhangjiagang along the Yangtze river delta, work on the factory will start at the beginning of 2016.
AAK believes that the factory will increase the company's capacity by about 100,000 MT, with scope for further expansion. It is expected to serve the bakery, dairy, infant nutrition, and chocolate and confectionery fats segments of AAK.
AAK group president and CEO Arne Frank said: "There is a significant potential for AAK in China and this new factory is an integral part of our company program AAKtion.
"China is moving from an export driven economy model to also a very strong, domestic and consumption driven economy. With a fast growing economy the demand for speciality and semi-speciality edible oils in China is expected to grow strongly."
AAK Asia, CIS and Middle East president Torben Friis Lange said, "This investment will make it possible for us to execute our strategy and grow our speciality oils and fats business in China with an increased customer service and more innovative co-developed products that address global as well as local trends.
The construction of the factory is part of a long-term investment plan in China that began with the establishment of an AAK sales subsidiary in 2011, followed by an innovation center in Shanghai last year.
