CAIRO: Whether it’s milk, fruit juices, yogurt, or cheese; odds are you consume at least one Juhayna product a day. Its line of products is set to increase as the company announced Wednesday plans to add two new subsidiaries at a combined capital of LE 450 million ($84 million).
With more than 28 types of food products, Egypt s Juhayna Food Industries has become one of the biggest dairies in the Middle East
“We are looking into expanding in new sectors to complement our [production line], said Chairman Safwan Thabet.
He added that the first subsidiary named Tiba was for marketing and distribution with a capital of LE 200 million. The second company called El-Enmaa specializes in agricultural and livestock development with a capital of LE 260 million.
“Tiba will distribute our products in cities across the nation, while Enmaa will provide our plants with needs from dairy products, fruits, organic fertilizers and feed, he added. “The world currently faces a global food crisis, and our [objective] is to secure our food products.
Established in 1983, the privately-owned Juhayna Food Industries has investments worth LE 1.2 billion in six factories and 50 production lines. Sales have grown some 200 folds to reach LE 2 billion this year, up from LE 11 million in 1983.
The firm holds around 30 percent of market share in Egypt and caters products to stores, hotels, airline carriers and multi-national troops. The firm exports around 20 percent of its production capacity to 48 countries including the US, European Union countries, Japan and the Gulf Cooperation Council countries.
However, spiraling food costs have hit Juhayna over recent months, almost doubling its input costs. “Higher inflation rates raise our production costs because prices of raw material increase, which all reflect on the price of end product, Thabet said. “When prices of milk, for example, soar 20-30 percent and prices of fruits almost double.it raises our input costs which will [naturally] affect consumers.
Consumer prices in urban parts of Egypt rose 19.7 percent in the year to May – a 19-year high for inflation – the state statistics agency CAPMAS said last Tuesday.
Inflation rates rebounded in the first three months of 2008, after decelerating in the second half of 2007. Consumer Price Index inflation surged 10.5 percent year-on-year in January and 12.1 percent in February, up from 6.9 percent in November and December.
In April, urban inflation in Egypt jumped to a fresh three-year peak of 16.4 percent, as food prices continued to surge. The central bank has already raised rates three times this year, saying inflation figures had exceeded its comfort zone.
In the one year to May, prices of bread and grains rose 50.8 percent, edible oils by 51.2 percent, fruit by 24.9 percent and vegetables by 27.6 percent.
In light of soaring food costs, Thabet said that Juhayna is currently eyeing new investments in land reclamation and agriculture.
“Spiraling food prices is pulling us towards investing in agriculture and land reclamation to sustain [our production]. We want to make use of all this desert to allow Egypt to feed itself, he added. “Agriculture and land reclamation have huge economic potential in the future.
