Tetra Pak to step up investment in Pakistan

 

By Jenny Wiggins in London

 

 

Tetra Pak, the world’s biggest packaging company, will step up investment in building new plants in emerging markets by 10 per cent to more than €200m ($283m) next year as global milk consumption rises to new highs.

 

The investments by the Switzerland-based group that makes carton packages for milk and fruit juices come amid a 1.6 per cent increase in global milk consumption in 2008 to 258bn litres.

 

Most of the growth is from emerging markets such as China, India and Pakistan as rising income levels enable more people to adopt high-protein diets.

 

Privately held Tetra Pak, which has 43 packaging plants around the world, is building plants in Lahore, Pakistan, which will supply the Middle East and India (where it is still searching for land) at a cost of about €90m each.

 

In China, annual milk consumption is running at record levels of about 27bn litres. In India, which is the world’s biggest milk producer and consumer, consumption rose 2.6 per cent to 51.5bn litres.

 

Last year, it completed a €60m packaging material manufacturing plant in Hohhot, China, and in 2007 it invested €100m in a similar plant in Russia.

 

A driver of the milk consumption boom is rising demand for packaged milk, particularly ultra heat treated milk.

 

UHT milk is heated to at least 135 degrees celsius for at least one second, which destroys bacteria and makes it last longer than ordinary pasteurised milk.

 

Also known as long-life milk, UHT milk accounts for 23 per cent of all liquid milk consumption, up from 18.7 per cent in 2004. Even in the UK, where less than 5 per cent of the milk market is UHT milk, sales are growing.

 

 

Courtesy: Financial Times

June 1, 2009