SMC to Expand Milling Operations
July 21, 2014
San Miguel Mills Inc. (SMMI), a unit of San Miguel Corporation food subsidiary, San Miguel Pure Foods Company Inc., is set to break ground in September for the expansion of its flour milling facility in Batangas, part of a 1,800-metric ton-per-day capacity expansion program that will also involve construction of two new milling facilities in other parts of the country.
"Our flour business has been showing consistent growth these past few years. Now we are approaching a capacity level that will trigger a planned expansion program," explained SMC president and chief operating officer Ramon S. Ang.
"This expansion will allow us to meet the growing demands of the domestic and regional flour market. At the same time, this will also do a lot in helping stabilize or drive down local flour prices as well as prices of commodities using flour," Ang added.
Ang noted that the industry has benefited from the sturdy Philippine economy with consumption of flour growing to 17.5 kg per capita. Per capita consumption in the Philippines, however, still lags behind consumption in neighboring ASEAN countries.
The project, which will involve the expansion of SMMI’s existing milling facility in Batangas and the construction of two green field facilities in other strategic areas, is part of the company’s overall strategy to grow the domestic market and at the same time penetrate the regional flour market.
"In terms of technology, the flour mills we are building will be more advanced than any in the country today. They will be geared towards serving the needs of the future. They will be able to produce many types and grades of flour, including some not currently available locally, to cater to the needs of an increasingly demanding and sophisticated market," said Ang.
Once operational, the new facilities will be integrated with SMMI’s existing mill and benefit from its recently opened Golden Bay Grain Terminal in Batangas, resulting in lower ocean freight cost of wheat as well as more flexibility in terms of the variety of wheat types to be used.
The expansion, Ang said, puts SMMI in a better position to aggressively strengthen its export business, particularly with the full implementation of the ASEAN Economic Community in 2015, which will allow for the free flow of goods, without duties, between ASEAN neighbors.
Ang added that a number of European firms have expressed their intent to partner with SMMI in building the facilities.