Economic Insight Q1 2017IndonesiaEconomic outlook: Growth likely to strengthen this year on improving external demand and terms of trade, modest slowdown ahead in 2018. Inflation is rising but likely contained not too far above target. Rising global yields and inflation mean BI is likely to start raising rates in 2017.

Main risks: BI targets a lower inflation rate than has historically been achieved; if they aim to push inflation expectations lower, policy will need to be tighter.

MalaysiaEconomic outlook: Both internal and external demand has demonstrated a modest pick-up, prompting us to raise our growth outlook by 20bps to 4.5% in 2017 and 4.7% in 2018. Inflation has also advanced and should head towards 4.5% until July 2017, per our projections.

Main risks: Sharp swings in the ringgit from aggressive US Fed rate hikes or a near-term spike in core inflation could prompt Bank Negara to hike the policy rate late this year.

PhilippinesEconomic outlook: As domestic demand normalizes from elections, higher food & energy prices and a low base are expected to guide inflation towards the upper end of the BSP’s 2-4% target.

Main risks: Already elevated inflation to begin with, albeit largely due to a base effect, could prompt the BSP to hike rates soon given an outlook of stronger oil price increases and weak FX pass-through.

SingaporeEconomic outlook: Sustained improvement in external demand alongside a modestly supportive fiscal stance should further lift GDP growth from 2.0% in 2016 to 2.5% in 2017 and 3.0% in 2018.

Main risks: If the exports rebound is sustained, MAS could slightly increase the slope of the SGD NEER policy band later this year, as a means to prevent domestic rates from rising rapidly in line with US Fed rate hikes.

ThailandEconomic outlook: Growth easing could extend into Q1, primarily pulled down by an unfavorable base, before sustained fiscal stimulus and an exports rebound brings growth to a 4.0% average in 2017 and 2018.

Main risks: Trade protectionist measures by the US pose a downside risk to our growth call, which partly hinges on a stronger exports outturn.

VietnamEconomic outlook: Vietnam is likely to see a modest pickup in GDP growth in 1Q as exports counter weakness in domestic demand.

Main risks: Despite higher inflation, the State Bank of Vietnam is likely to refrain from hiking rates until 2018, as it accelerates bad debt resolution and restructuring of the banking system.

region. Asia Pacific is then followed by the Middle East and Africa with $145.2bn, the Americas with $98.2bn and Europe with a project pipeline of $50.4bn. The highest value of projects is at the execution stage, with $187.2bn, while those in planning have a combined value of $173.0bn. Projects in the pre-execution stage amount to $53.8bn, while those at the pre-planning stage (announced and study) are valued at $43.8bn. India has the highest value of port construction projects, according to the pipeline tracked by the CIC, with $50.9bn, followed by Australia with $29.3bn. The UAE and Indonesia follow with project pipelines with values of $29.1bn and $27.3bn respectively.

Timetric’s Construction Intelligence Center new report, Port Construction Projects: Global, shows that 36% of the total global value of port projects belongs to the Asia-Pacific

A study develops a method for the edge coverage improvement of cathodic electrocoatings by silica nanoparticles. The effect of silica nanoparticles on the rheology of curing process, anti-corrosion performance, edge protection, and morphology are studied. Significant improvement with 4 wt% nanoparticles. Field emission scanning electron microscopy (FE-SEM) is utilised to investigate the dispersion of nanoparticles in the coating matrix. The anti-corrosion performance is studied by electrochemical impedance spectroscopy (EIS) and salt spray tests. Rheometric mechanical spectrometer (RMS) and dynamic mechanical thermal analysis (DMTA) are used to investigate the rheology of the curing process and curing behavior of the coatings respectively. Minimum melt viscosity has increased significantly in the presence of the 4 wt% nanoparticles. Results show significant improvement of edge coverage in presence of the 4 wt% nanoparticles.

Asia-Pacific Leads the Global Port Construction

Jotun is opening a state-of-the-art research and development centre at its site in Flixborough, United Kingdom. The GBP 4.5 million facility will focus on passive fire protection and insulation coatings innovation, cementing Jotun’s position at the vanguard of this demanding industry niche. Jotun is now seeking to expand its specialist team of fire protection chemists and products in response to increasing demand within the infrastructure, oil, gas, petrochemical and energy sectors. “We’re experiencing sustained growth in our advanced fire protection coatings segment and we want to build on that momentum,” explains James Irving, Jotun R&D Manager. “We already have a cutting-edge fire and insulation research facility in Dubai, United Arab Emirates, and this new centre will work in tandem with that established team, increasing capacity and accelerating new developments.

Jotun Consolidates Passive Fire Protection Coatings Lead in Flixborough R&D Facility

AkzoNobel has officially opened its €11 million powder coatings facility in Chengdu, western China. The new site will help to meet growing demand in the region and supply customers with a full range of powder products for the automotive, construction, furniture and IT industries. “The opening of our Chengdu production site will strengthen our position as the global leader and China’s largest powder coatings supplier,” said Conrad Keijzer, AkzoNobel’s Executive Committee member responsible for Performance Coatings. “It will allow us to leverage the strong growth that we see in the western provinces of China, furthering our organic growth momentum.”

New AkzoNobel Site Strengthens Leading

Powder Coatings Position

Improving the Edge Protection of Automotive

Electrocoatings

Coating & ResinsIndustry Focus Q1 / 20172

News by CountryIndonesiaJokowi Optimistic of Witnessing 10% Growth in Automotive Industry

Indonesian President Joko Widodo (Jokowi) is optimistic that the automotive industry would attract more investors and grow over 10 percent annually. President Jokowi expressed optimism in his remarks at the opening ceremony of PT Mitsubishi Motor Krama Yudha Indonesia (MMKI) at the Greenland International Center, Central Cikarang, Bekasi District, West Java. “With such a large market, I am certain that more investments will flow into the automotive sector of Indonesia, as we have a large market, and greater the investments, more employment opportunities will be available,” he emphasized. President Jokowi lauded Mitsubishi Motors commitment to increasing its investment by setting up a new plant in Indonesia, which will be able to offer jobs to around three thousand people. Hence, Jokowi is committed to easing the flow of investments, particularly in the automotive sector, considering its impacts on the economic growth.

VietnamVietnam Driven to Protect Domestic Automobile Industry

Vietnamese policymakers are looking at ways to safeguard the domestic automobile industry against foreign rivals. Vietnam’s automobile industry is expected to face more hurdles in the years to come as the local market opens up to foreign competitors. Locally-assembled cars could cost 20 percent more than those imported from neighboring countries such as Thailand and Indonesia in 2018, when tariffs on car imports into Vietnam from other ASEAN countries will be cut to zero from the current 50 percent, the trade ministry said. The government has asked trade officials to look at ways to prevent a surge in car imports. The Southeast Asian country has targeted car manufacturing as a “spearhead industry” that could help it move up the global chain. However, the fact that it still heavily relies on imported cars to meet local demand has exerted tremendous pressure on local manufacturers.

ThailandTata Aims to Build on Recent Truck Gains in Thailand

fiscal year to roughly 3,000 units. With a 10-year contract up at the Thonburi Automotive Assembly Plant in the south of Bangkok, Tata has signed a renewable 5-year pact with the Bangchan General Assembly plant, 34 km west of central Bangkok. Production will begin at Bangchan after the installation of assembly equipment at a cost the Bangkok Post puts at 500 million Thai Baht ($14.5 million). The facility will have a capacity of 8,000 Tata Xenon pickups and 2,500 Tata Super Mint pickup trucks in a 1-shift operation. Tata says Xenon production will launch in September. To help reach its local sales target, Tata says it also will introduce more models to local showrooms.

Philippines$166M Office Project Planned for the Philippines

secured a $166M contract from ArthaLand to provide engineering, procurement and construction (EPC) services for its Cebu Exchange project in the Philippines. The project will involve the construction of a 38-storey office building on an 8,440 sq m property. The facility has been designed to accommodate information technology and business process management (IT - BPM) locators who are expanding their operations in the region. Expected to be the first and only Grade-A office building in Cebu, the project is set to achieve LEED certification, and the Philippine Green Building Council’s Building for Ecologically Responsive Design Excellence (BERDE) certification.

Knusford Berhad (KB), a Malaysian construction and property firm, and China Railway Dongfang Group Sdn. Bhd. (CRECSB) have

Indian automaker Tata is moving production in Thailand as part of a company reset that aims to increase its Thai sales 83% this

Coating & ResinsIndustry Focus Q1 / 20173

Tetra Pak to Invest in Packaging Plantsin South Asia, East Asia & Oceania

GM to Drive Industry toward Sustainable Natural Rubber Tires

Creativity Shines in Golden Age of Light Fixture Technology

General Motors Co. is collaborating with rubber and tire suppliers to establish a plan to source more rubber through environmentally sound and sustainable natural rubber production. Additionally, the auto maker also intends to move the industry toward net-zero deforestation and uphold human and labor rights. Steve Kiefer, GM’s senior vice president of global purchasing and supply chain, said in that GM is establishing commitments with suppliers such as Bridgestone Americas Inc., Continental Tire the Americas, Goodyear and Michelin to determine a plan for the future. “We want to encourage affordable, safer and cleaner options for our customers that drive value to both our organization and the communities in which we work,” Kiefer said. Working with those suppliers is the first step in the plan, as the auto maker looks for ways to develop transparency into natural rubber usage and ensure its traceability throughout the supply chain.

Food processing and packaging solutions company, Tetra Pak has announced a $33 million investment in its first plant for Packaging Closures in South Asia, East Asia and Oceania. The facility is set to capture the region’s rapid market growth for packaging with Closures, forecast to grow by more than 30 percent between 2015 to 2018. The advanced regional manufacturing facility will be located within the company’s existing Straws and Strips Plant in Rayong, Thailand, and will become operational in early 2018. With a production capacity of more than three billion units per year, the new plant will enable customers across the region to access locally produced Closures for the first time. Besides producing new generation Closures such as HeliCap 23, HeliCap 27 and DreamCap 26, the factory will also produce bio-based Closures, to help drive the sustainability agenda.

Plastic & RubberIndustry Focus Q1 / 20174

Johan de Nysschen’s efforts to enhance the image of Cadillac will owe a small shout-out to the rise of LED lighting technology. The increasing use of flexible LED applications in auto headlights and accent lights has resulted in a golden age of light design across the industry. Confident that they can do almost anything they want with light fixtures these days, vehicle stylists have discovered a new canvas to bend and turn and embellish the front-end designs of their cars.Playing in the LED sphere, designers have introduced changes to the front-end, combining Cadillac’s longstanding vertical lighting tradition with a touch of horizontal.Thanks to flexible LEDs, the lights permit the use of deep crevices in the fixture and glowing flat acrylic lines.

Bridgestone Airless for BicyclesBridgestone is to take its airless tyres to bicycles soon. First presented in 2011, these tyres use a series

of rigid plastic resin spokes to help a wheel keep its shape as it rolls, instead of an inflatable inner tube that can puncture and leak. The company is now making a bicycle version. By simplifying the structure of the classic tyre, Bridgestone has reduced the resistance caused by wheels continuously changing shape as they roll. All the materials used in these airless tyres are recyclable. The thermoplastic resin, which becomes flexible when heated and hardens when cooled, allows it to be processed into a variety of shapes.

News by CountryMalaysiaChina’s Mehow Builds Medical Molding Plant in Malaysia

Chinese medical injection molder Mehow Innovation Ltd. is investing more than $20 million in a new facility in Malaysia, its first outside China, as it responds to global customers who want it to diversify outside its home country. The Shenzhen-based company, which has more than 85 injection presses and 1,000 employees at its headquarters factory, opened the first phase of its new plant in Penang, Malaysia, earlier this year. It has started a second phase there that will be completed by the of the year, which will give it a little more than 20 molding machines in Malaysia. More than 90 percent of its manufacturing is exported and about 75 percent of its sales are in thermoplastic parts, with the other quarter in LSR. About 65 of its molding machines in Shenzhen are focused on thermoplastic molding.

ThailandContinental to Build New Passenger, Light-Truck Tyre Plant in Rayong

Germany-based automotive technology multinational Continental has chosen Rayong province as the site of a new tyre factory to supply the Asia-Pacific region. In the first phase, the investment in the new tyre plant will amount to around 250 million euros (Bt9.45 billion), with planned production of about 4 million passenger and light-truck tyres (PLT) per year by 2022.The start of operations is planned for 2019. “One important pillar of our long-term strategy is to operate with an agile and flexible set-up that enables us to react fast to the market requirements, establish further production capacities in the growth region APAC and to strongly support our Asia-Pacific growth plans with high-tech production capabilities,” said Nikolai Setzer, a member of Continental’s executive board in charge of corporate purchasing as well as the tyre division. The size of the site is about 750,000 square metres, which potentially allows a capacity expansion to up to 25 million tyres per year. Continental expects the start of construction and groundbreaking before the end of this year.

VietnamVietnamese Crazy about Cars, Manufacturers Rush to Sell

Car trading in 2016 saw the number of projects in the sector increasing sharply. About 505 projects in the field were licensed, ranking second in terms of foreign direct investment (FDI), just after real estate, according to the Ministry of Planning and Investment (MPI). The representative of a foreign-invested automobile manufacturer said previously, FDI capital flowed into production and assembling, but now, it pours into retail and postsale services. About 30 leading brands are present in Vietnam. However, most of them still don’t have large distribution networks. It is expected that by 2029, Vietnam market scale would be about 1 million brand-new cars a year with revenue of $12 billion. Experts have predicted the growth rate would be 20 percent in 2017 thanks to the tax cut and lower car prices. An analyst said there were clear opportunities to make money from selling cars as import tariff cuts would make cars cheaper and more affordable to Vietnamese.

PhilippinesFire Destroys Yokohama Warehouse

A major fire gutted the warehouse of Yokohama Tire Philippines Inc. (YTPI) destroying export-ready newly made tyres. It said that the company had to cancel work for about 2,000 workers and service contractors to give way to an investigation into the cause of the fire at its Phase 3 warehouse. The report quoted Angelina Casasola, YTPI vice president for administration, as saying that the firm could not yet say when regular work would resume at the factory, the biggest outside of the Japan-based Yokohama Tire. Other YTPI warehouses and stocks there have been secured.

Plastic & RubberIndustry Focus Q1 / 20175

pass on the similar fall in global markets and proportionate decline in seed prices locally. Indian edible oil (both branded and unbranded) producers, however, plan to offer discounts on the maximum retail price (MRP) on the consumer packs produced earlier. Lose retailers, too, would pass on the price fall in the international and domestic markets to consumers. Meanwhile, a cut on the MRP would depend on the sustainability of the present price level for long. The 15 percent price cut in the edible oil basket is set to reduce kitchen budget by 1.5 - 2 percent for average Indian households considering cooking oil’s 10 percent contribution to the entire kitchen expenses. “The current fall in edible oil and oilseeds can be attributed to a combination of factors including bumper soybean output in North and Latin Americas, weak demand from global bio-diesel sector due to subdued crude oil prices and bumper seed output in India this year. Every price fall in the raw materials is immediately passed on to customers and the current one is no exception,” said Atul Chaturvedi, Chief Executive Officer (Agri Business), Adani Wilmar Ltd, the producer of Fortune brand edible oils.

In a major relief for consumers, edible oil producers are looking to cut their product prices by up to 15 percent effective immediately to

Performance ChemicalsIndustry Focus Q1 / 20176

Vehicle Production to Float Asia’s Market

Edible Oil Producers to Cut Prices by 15%

Indonesia Bets on $200-BillionInvestment to Boost Energy Output

The Asia-Pacific region’s total lube market is expected to be 4 percent larger by 2025, a Frost & Sullivan analyst said. Minor dips in demand due to longer-lasting motor oils will be offset by increased vehicle manufacturing. “Between 2017 and 2025, the region’s lubricant industry will shift towards longer-lasting lubricants,” said Shikhar Aggarwal, director of visionary sciences consulting in Singapore. “While usage of lubricant per car may remain stable or drop marginally, the industry is expected to be buoyed by increasing vehicle production.” Asia-Pacific is the largest market for lubricants, accounting for close to 45 percent of global demand, he told the 11th ICIS Asian Base Oils & Lubricants Conference. “It is also the fastest-growing region, with India, China and some ASEAN countries leading the rally.” In 2016, global demand for lubricants was about 42 million metric tons, according to the U.S.-headquartered consultancy. Asia consumed 19 million tons, with China slurping 29 percent of that volume. The main drivers of industrial lubricants include “increased vehicle production and rising manufacturing output, accompanied by rapid industrialization in emerging Asia-Pacific countries,” Aggarwal said. The region is “witnessing significant investments in manufacturing facilities across all vertical segments such as construction, automotive and steel.” Yet decreases in industrial activity due to manufacturing reforms in China, for example, will check that growth.

Indonesia plans to overhaul its energy policy to attract investment of as much as $200 billion over the next decade as the former OPEC member seeks to reverse a decline in its crude oil production. The amendments to the energy policy, once approved by President Joko Widodo, will allow explorers various financial incentives including tax-free import of drilling equipment and technology and easier cost-recovery, Energy and Mineral Resources Minister Ignasius Jonan.

Southeast Asia’s biggest economy is seeking to lift production of oil and gas as a supply deficit widens, deepening the nation’s reliance on imports. Indonesia suspended its membership of the Organization of Petroleum Exporting Countries in November after just one year of rejoining the group as it struggled to stem a decline in crude and gas production caused by aging fields and a lack of investment in exploration for years.

News by CountryCambodiaPestech Wins $100M Contract for Cambodia Hydro Power Plant

Pestech (Cambodia), a wholly-owned subsidiary of Pestech International, has bagged a $100M contract from Cambodia-based Alex Corporation for the Stung Tatay Hydro Power Plant – Phnom Penh Transmission System Project in Phnom Penh, Cambodia. Under the terms of the contract, Pestech will be responsible for the design, engineering, manufacturing, installation, testing and commissioning of the 230kV Stung Tatay Hydro Power Plant – Phnom Penh Transmission System Project. It will include a 220km, 230kV double-circuit transmission line from Stung Tatay HPP to Phnom Penh.

MyanmarMyanmar Turns to Coffee as Crops Threatened by Climate Change

With climate change affecting crop production, Myanmar is taking steps to boost the coffee industry. Dr Aung Thu, Union Minister for Agriculture, Livestock and Irrigation said, “In the period between 2018 to 2030, it is targeted to increase the coffee growing acreage up to 200,000, with 600,00 tonnes of high-quality coffee expected to be produced by 2030. Now that coffee organizations have emerged and Myanma coffee is being exported to the global market, prospects for Myanmar coffee are found to be going well.” In the world commodity market, coffee follows petroleum as the most exported crop from developing countries. Of the exported agricultural produce from Myanmar, rice and varieties of beans are a staple source of foreign exchange. Likewise, coffee is a kind of crop bringing in foreign exchange, Vice President U Henry Van Thio said.

ThailandFOMM to Make EVs in New Thai Plant

Japan’s FOMM Corporation is scheduled to start the construction of its assembly plant for its compact electric vehicles (EVs) at Amata Nakorn Industrial Estate this year, with production expected to kick off by June next year. Chief executive Hideo Tsurumaki said the plant, which has an investment cost of about US$6 million (206 million baht) will make 5,000 units of compact EVs a year. In March, the BoI approved promotional privileges for EVs, including tax holidays of 5-8 years. The privileges focus on production of hybrid electric vehicles (HEVs), plug-in electric vehicles (PHEVs) and battery electric vehicles (BEVs). The BoI added 10 more important EV parts that will enjoy corporate income tax exemption for eight years. They include batteries, traction motors, battery management services, EV smart charging systems, DC/DC converters, inverters, portable electric vehicle chargers and electrical circuit breakers.

MalaysiaMalaysia Highway Project to be Privatized

Lebuhraya DUKE Fasa 2A (LDF2A), a subsidiary of Malaysian construction firm Ekovest, has received approval in principle from the government for the privatization of the MYR6.32bn ($1.4bn) Kampung Baru Link, Istana Link and Kapar Link expressway. The 75.2km highway will offer connectivity and direct linkage for movement in and around Kuala Lumpur City Center, and will complete the missing link for travelling in and out of Greater Kuala Lumpur and Klang Valley. “The proposed project is subject to further terms and conditions to be negotiated between the government and LDF2A and the principle approval by the government shall not in any way be considered as binding upon the government until the execution of the relevant agreement between the government and LDF2A,” said Ekovest in a stock exchange filing.

Performance ChemicalsIndustry Focus Q1 / 20177

Jebsen & Jessen Ingredients hosted the first regional technical seminar “Achieving 30+ Piglets per Sow per Year in ASEAN” a day prior to VIV Asia 2017. The target audience for this half day technical talk was aimed at farm owners, nutritionists, and veterinary professionals. The event was made possible by the collaboration of our partners: Hamlet Protein, ECO Animal Health, external consultants from Danish Farm Design and Danish genetic company called DanBred. Due to the outstanding topic covered by our key speakers, we were able to attract 85 participants to the seminar which was 70% more than originally planned. This seminar was a platform connecting our sales teams closer to both the customers and the business partners.

Jebsen & Jessen Ingredients, Regional Feed Department participated in VIV Asia 2017 during 15-17 March. This is the biggest feed exhibition organized in Bangkok, Thailand every two years. The record breaking number of visitors were in excess of 40,000 and total 1,104 exhibitors spreading out

over 7 halls including the lobby. Our booth was co-shared with 2 of our regional principals: ECO Animal Health from UK and FF Chemicals from the Netherlands. Also participating at the show with their own booths were 9 of our principals. Our regional feed sales teams were busy engaging with customers and showcased our very own Jebsen & Jessen Ingredients farm pack supplement for shrimp and livestock.

Feed TechnicalSeminar & VIV Asia 2017by Jebsen & Jessen Ingredients and Partners

The benefits of probiotics keep adding up for livestock producers. Research shows that including probiotics in rations can improve producers’ return-on-investment through better feed efficiency, increased production or even more robust immune responses. To get results, Dr. Angel Aguilar Ph.D., Dipl. ACAN, Technical Service Manager, Lallemand Animal Nutrition, suggests using four main criteria for selecting a probiotic:1. Alive: Choose a probiotic containing live, or viable, bacteria or yeast.2. From a trusted manufacturer: Ensure production and handling preserves the probiotic activity throughout the entire production distribution process.3. Specific: A probiotic should be specifically selected strains, and proven, for a production or a health outcome in livestock.4. Feed daily: Include probiotics in livestock rations each day to maintain an effective level.

We were fortunate to have the booth in an excellent location near the entrance and this helped put our company and brand up in the spotlight. It had been 3 busy days at VIV Asia 2017 where more than 20 new prospective suppliers approached Jebsen & Jessen Ingredients for possible cooperation discussion.

Lallemand’s Keys forEffective Probiotic Use

8 Feed Industry FocusQ1 / 2017

News by CountryCambodiaDemand for Meat Grows in Cambodia

Cambodia’s growing population, urbanization, economic growth and changing consumption patterns have created opportunities for the growth of the livestock sector in the country, reported the Khmer Times quoting the Ministry of Agriculture, Forestry and Fisheries’ (MAFF) annual report. “With an estimated population growth rate of 1.8%, projected meat demand in Cambodia from 2016 to 2024 is anticipated to increase from about 280,000 tonnes to 328,085 tonnes a year,” stated the report. Some 1.35 million domesticated animals were slaughtered for meat throughout the country, to meet growing demand. “Throughout the year, some 55,292 cows, 1155 buffaloes, 299,871 pigs, and 994,454 chickens were slaughtered for local meat consumption,” the report stated.

VietnamVietnam Plans to Become Global Shrimp Production Base

Prime Minister Nguyen Xuan Phuc said Vietnam should aim to become the shrimp production center of the world. He said that exporting USD 10 billion worth of shrimp products by 2025 is feasible. He said the Ministry of Agriculture and Rural Development’s USD 10 billion a year target by 2030 was too low. Mr Phuc said if Minh Phu Seafood JSC targets exporting USD 2 billion worth of shrimp by 2021, the entire Ca Mau province would be able to export USD 4 billion worth of shrimp. The remaining USD 6 billion can be reached by other provinces and cities. This means that the USD 10 billion target by 2020 can be achieved.

MyanmarMyanmar Bids to Become Major Shrimp Exporter

Myanmar is setting out to become a regional top shrimp producer to rival Thailand and Vietnam, hiring the technical assistance of American experts. “We are about to start sustainable shrimp farming with the help of a firm from the United States,” Kyaw Tun Myint, president of the Myanmar Shrimp Association said. He said Myanmar entrepreneurs in the industry were keen on farming white shrimp with the latest technology from Hawaii-based Marine Genetics LLC. “We will start farming white shrimp this year. If we are successful, it will not only support our food security but also may reduce the trade deficit up to 25 percent, thanks to potential surge in shrimp export,” he was quoted as saying. Myanmar could export 100,000 tonnes of shrimp worth US$1 billion yearly over the next five years.

ThailandBetagro Opens Its FirstPet FoodPlant in Thailand

Betagro officially opened its first pet food plant in Lopburi province, Thailand on March 21. The company has been engaged in pet food business for almost

Indonesia Demand for free range pork in Bali is increasing

East Bali Cashew based in Bali has diversified its business into pig farming and processing. Recently the company bought two boars and three gilts from Bioceleng Farm for breeding, Romeo Alfonso, owner of Bioceleng Farm told. Having a total of 300 pigs, East Bali Cashew raises its pigs under a free-range farming concept. The company processes its pork into sausages and bacon, then supplies them to restaurants in Bali. Mr Alfonso said demand for pork produced from free-range or organic farms in Bali is increasing.

12 years, Vasit Taepaisitphongse, President of Betagro Group said. The new plant produces dry pet food and pet snacks for dogs and cats. In its first phase, the company invested USD 34.64 million in the new facility, which has a monthly production capacity of 4,000 tonnes. While 70% of the production capacity will serve the local market, 30% will target overseas markets including Asean countries, Japan and Europe, said Chayanon Kittayachaweng, Executive Vice President & Chief Operating Officer of Betagro’s Agro Business. The company will tentatively increase monthly production capacity to 7,000 tonnes in the second phase in early 2018 and to 12,000 tonnes in the third phase.

9 Feed Industry FocusQ1 / 2017

JJ-Muntons (Thailand)have been busy sending production size samples to customers across the region for advanced trials and early production runs. Samples of plain and coloured Dried Extracts have been very popular. Several different flavours of Malted chocolate powder and Malted milk powder have been taken in large batch quantities by customers keen to enter into the malted drinks market. With customers keen to develop custom recipes this is creating a great excitement in the factory. Interest has been especially high in the ‘Crunchy’ formulations which have a great mouthfeel when eaten dry or added to other bakery or food products.

The main focus over the last few months has been for the certification audits required by many customers and for export

to some countries in Asia. After a pre-audit and first stage audits in February, the factory passed the second stage audits for both HACCP and GMP in March. These required a through audit of operational and hygiene procedures over the course of a day by professional 3rd party auditors. The two Auditors spent the day checking the facility, machine operation, validating procedures and interviewing staff.

In April JJ-Muntons also completed their Audit for Halal certification and are now able to issue certification from CICT for Muslim markets.

WORK BUILDS UP AT

JJ-MUNTONS

10 Food Industry FocusQ1 / 2017

Colin Whitehouse, General Manager JJ-Muntons noted, “These audits represent the culmination of almost a year’s work by JJ-Muntons Staff. Only 12 months ago

JJ-Muntons was just completing construction and none of our operators had seen a drier or worked in a food factory. The team, equipment and process was new and untested. Having installed the utilities, assembled the equipment, learned how to use and maintain it all, then written work instructions and procedures from scratch was already a major achievement. Now to have them validated and approved by a third party in such a short time has been an excellent team effort.”

News by CountryIndonesiaYakult Indonesia Still Relies on Imported Milk for Dairy Drinks

Yakult Indonesia vice president and director Hiroyuki Kawada said the company had to import ingredients because local milk had yet to meet the standards for the company’s fermented milk |production. “We mostly import the skimmed milk from Australia, and the rest is from Belgium,” he said. The factories can produce 6.6 million 65-millilitre bottles of cultured dairy drink a day. The company sells its fermented milk through supermarkets and through “Yakult Lady”, a sales force of women who sell the product door-to-door in many parts of the country. Indonesia was the second-biggest market for Yakult products after Japan, which has 10.18 million consumers.

ThailandThailand’s Ageing Society Expected to Affect Supplements Market

Though the dietary supplement market is expected to expand significantly in the next 10 to 15 years, the changing demands in Thailand’s ageing society will shrink it at an average of 8 per cent per year, a study conducted by SCB Economic Intelligence Centre (SCB EIC) shows. The survey reveals that consumers aged over 50 tend not to believe in the effectiveness of supplements and many who have tried them don’t notice any benefits and choose other ways to take care of their health, such as exercise or improved dietary habits. Meanwhile, demanding more products derived from natural extract and more personalised products are a significantly growing trend and if businesses do not change their strategy, the EIC expects the value of the market to shrink by 8 per cent on average over the next 15 years.

SingaporeJanuary Retail Sales Rise 2% from Year Earlier

Singapore’s retail sales in January rose from a year earlier thanks to an increase of supermarket as well as food and beverage sales. Total retail sales rose 2 per cent from a year earlier, after increasing by a revised 0.7 per cent in the previous month, according to data from the Singapore Department of Statistics. Retail sales of supermarkets and the food and beverages sector rose 13 per cent and 12 per cent, respectively, in January from the year before. On a month-on-month and seasonally-adjusted basis, total retail sales fell 1.5 per cent in January after a revised 0.8 per cent drop in the previous month.

MyanmarKirin to buy Mandalay Brewery to Dominate Myanmar Market

Japanese brewer Kirin will buy Mandalay Brewery of Myanmar for an estimated several million US dollars in its latest effort to strengthen its presence in the Asia-Oceania region. Kirin will create a local subsidiary to take over the country’s oldest brewery, based in the northern city of Mandalay, from the military-backed Myanmar Economic Holdings. With the planned purchase, Kirin, which bought local market leader Myanmar Brewery in 2015, will control 90 per cent of the country’s beer market.

VietnamVietnam’s Top Brewer Sabeco Tops Up Profit Goal for 2017

The company expects its annual sales to rise 3 percent against last year. Vietnam’s biggest brewer Sabeco is aiming to

Food Industry FocusQ1 / 2017

push sales to more than 1.7 billion liters this year, an increase of 3 percent against 2016, in a bid to raise its annual revenue by 9 percent to $1.52 billion and net profit by 1 percent to $207 million. Company bosses said that price cuts on ingredients, a preferential tax policy on malt and stable market growth in rural areas, where Sabeco is the most competitive, are the reasons for the more positive targets. Sabeco, known for the Bia Saigon and 333 brands, is also preparing for fiercer competition on the domestic market following Belgium’s Anheuser-Busch InBev entry into the Vietnamese market.

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EUDRAGIT® Technical Workshop was held by the cooperation of Evonik and Jebsen & Jessen Ingredients (T) Ltd. The total of 78 participants from pharmaceutical companies, R&D institutes, as well as university lecturers attended this one-day event at Sheraton Grande Sukhumvit Hotel on 31st March 2017. The introduction session was broadcast LIVE in our Pharma & Personal Care’s official Facebook account: https://www.facebook.com/Jebsen-Jessen-Ingredients-Pharmaceutical-Personal-Care-373153536387843/. All participants were invited to add and follow in order to receive Pharma & Personal Care updated information in the industry including new product promotions.

The morning topics being presented were introduction of Evonik and BL-Healthcare, customized release profiles with Eudragit®- tailored to your specific needs, important parameters and trouble shooting for working with Eudragit®, and drug layering and functional coatings in fluid bed equipment/technical aspects from R&D to production by special speaker from Glatt GmbH, Mr Roger Schütz, Process Expert.

In the afternoon, the participants were divided into 2 big groups. The first group went to Evonik’s lab to learn about lab demonstration: pellet coating using Midi-Glatt, Eudragit® L30D-55 with pH adjustment preparation, and posters and videos session. After an hour, the first group was rotated to the other session taking place at the hotel. Meanwhile at the hotel, the second group learned about optimization of cleaning process using Chematic® formulated detergents targeted for the Eudragit® product line presented by special speaker, Ms Priya Poduval, Chematic Technical Sales Specialist from Dober. After 1 hour, this group was also rotated to Evonik’s lab.

Pharmaceutical Workshop in Partnership with Evonik

“The Best Marketing Practices 2016”from Evonik Health Care

Evonik Health Care is our key and important partner. The most important of Health Care Business Line product is Eudragit®, p h a r m a c e u t i c a l polymers. These

polymers enable the API in your solid dosage form to unfold its full therapeutic potential where and when it delivers the best results. Eudragit® polymers

are crucial part of pharmaceutical solid dosage forms. Jebsen & Jessen has a long partnership with Evonik Health Care in Southeast Asia. We introduce and promote Evonik Health Care products especially Eudragit® to pharmaceutical customers. Furthermore, technical workshops and seminars are organized regularly. We arrange and find most desirable and informative topics to keep our customers updated with the technology which make Jebsen & Jessen’s workshops and seminars well accepted by the customers. Jebsen & Jessen was awarded “The Best Marketing Practices 2016” at Evonik Health Care Business Partner Meeting. This is a yearly event which Evonik Health Care invites all business partners in Asia Pacific. We are very proud to be recognized by our important supplier, Evonik Health Care. We will therefore keep promoting the products and introducing advance technology to our customers.

Pharma & Personal Care Industry Focus Q1 / 2017

News by CountryIndonesiaPharma in Indonesia Competingfor Higher Margins

IPMG members – including Novartis, Merck, Bayer, Boehringer Ingelheim, and P zer – have invested more than US$1 billion in Indonesia’s pharmaceutical industry over the past few years, particularity for the construction of factories and clinical research. Indonesia’s largest pharmaceutical company, Kalbe Farma, is shifting from being a maker of generic drugs to a high-tech pharma developer. Besides producing cancer drugs, Kalbe has been investing in R&D on stem cell therapies. Significantly, a lack of generic substitutes in these fields in Indonesia implies no government-set price ceilings, and therefore these products offer higher margins. In fact, there are more than 200 drugmakers in Indonesia, most of which produce only low-margin generics. While they control 95 percent of the market by volume, they have a combined 75 percent share in value terms. Therefore, the few multinationals operating in the country have been able to make more profits because of their focus on high-value products.

VietnamFree Trade Agreements Boost Cosmetics Sector

Through free trade agreements, import tariffs on cosmetics will be reduced to 0-5%, paving the way for the Vietnam’s domestic market to develop its presence in APAC. With the signing of the Trans-Pacific Partnership (TPP) agreement in October 2015, Vietnam will benefit from lower pricing, barrier removal and decreased tariffs by up to 100%, Euromonitor International reports. While this creates significant trade opportunities for Vietnam, as more international companies will be setting their sights on the Southeast Asian country, domestic players may be pushed out of the market and unable to compete with international names.

PhilippinesPhilippines’ Healthcare Spend to Grow 9.2% to US$36b in 2026

It has been noted that generic drugmakers will be the primary beneficiaries of the Philippine government’s investment into healthcare. According to a research note from BMI Research, while the expansion of universal healthcare is a positive for the broader pharmaceutical sector, the specific target of President Rodrigo Duterte’s 2017 budget and other public health initiatives are on expanding healthcare access to low-income Filipinos. This will grow a patient segment that, given constraints on affordability, will demand for low-cost pharmaceuticals. Such opportunities will spur greater investment from both multinational drugmakers with strong generic portfolios and Indian pharmaceutical firms, intensifying the level of competition.

MyanmarUnilever and EAC Create Joint Venture to Grow Myanmar Presence

Unilever and Europe & Asia Commercial Company (EAC) have set up a joint venture in Myanmar in a bid to grow operations in the Southeast Asian country. The new entity will be known as Unilever EAC Myanmar Company Limited and will manufacture, market and distribute home and personal care products in Myanmar with a view to benefiting both companies, growing sales and market share. “In line with Unilever’s leadership in other South East Asian markets like Indonesia, Thailand, Vietnam, Philippines, we see this joint venture as a critical milestone to further our growth vision in Myanmar. EAC has a strong heritage in Myanmar and we share a complementary product portfolio. Our partnership will allow us to scale up our Home Care & Personal Care businesses and enhance the lives of consumers in Myanmar with better health, hygiene and nutrition,” said Pier Luigi Sigismondi, President Unilever South East Asia Australasia.

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