Shanghai Al-Amin Biotechnology Co Ltd (AminBio), one of China’s major halal food producers, is expected to invest at least RM100 million in a production plant in Malaysia that would have the capacity to produce 3,000 tonnes of halal gelatine per year.
AminBio CEO Dawood Su Han (picture) said the plant is expected to offset the shortage of halal gelatine within the country and the South-East Asian region.
He said the company is currently undertaking a feasibility study, expected to be concluded soon, that would pave the way for the plant to be built soon.
“We are currently conducting a study to determine the best location for the plant. We would prefer it to be either in Selangor, Melaka, Negri Sembilan, Perak or Johor,” he told The Malaysian Reserve (TMR) on the sidelines of the recent Mihas Symposium on Halal Gelatine Ecosystem in Kuala Lumpur.
Ideally, the plant would occupy a 20.23ha piece of land and the entire project is expected to take two years to complete.
Dawood said it would, however, be best if the group could acquire plots of land in the Klang Valley, especially locations that are nearer to the port, which would give the company logistical advantage for import and export.
He added that the company will also be collaborating with Universiti Malaysia Pahang (UMP), Majlis Amanah Rakyat (MARA), Malaysian Investment Development Authority and the Malaysia External Trade Development Corp for the project’s development.
Once the plant is completed, it is expected to be the hub for the Asean market, particularly Indonesia.
At the moment, AminBio operates a gelatine manufacturing plant in China that has the same capacity as the proposed Malaysian plant.
Dawood said 90% of the products manufactured in the proposed plant in Malaysia would be exported to other Asean countries, particularly Indonesia that has the largest number of halal consumers in the region.
He said the facility in China currently produces 3,000 tonnes of halal gelatine annually, using bones, skin and tissue of one million cattle as its raw material.
In order to produce about the same volume of gelatine here, the company has to find ways to mitigate its raw material issues.
Dawood said the company has already invested in upstream activities in other countries that will enable the company to control the supply of raw materials.
“We can also import materials from countries such as New Zealand and Australia at cheaper cost because of the higher volume order,” he said.
Dawood said AminBio’s annual total turnover has also reached up to 200 million yuan (RM122.8 million) in the last five years.
“Once the proposed plant is in operation, our projection for the Asean market alone is around RM200 million per year,”
He added that the plant is also expected to churn out pharmaceutical as well as food and beverage products, apart from having the capacity for downstream goods, including gelatine leaves and collagens.
Last week, TMR reported that Malaysia is suffering from the shortage of halal gelatine, and currently has to import about 2,000 tonnes from Pakistan and India.
MARA and UMP has built an incubator that is slated to start operations by the end of 2019. The facility, located at UMP’s main campus in Pekan, Pahang, can produce up to 360 tonnes of gelatine a year.
The RM20 million incubator will also be used for training purposes among UMP and MARA students.
Globally, only 0.7% of the total gelatine produced is halal with only 90,000 tonnes produced annually to cater to more than 1.7 billion Muslim population.