Fruit-based product producer China Nutrifruit Group is to build a US$19.1m fruit and vegetable powder manufacturing facility in Daqing, Heilongjiang Province.
The company said yesterday (28 January) that it plans to acquire land use rights in Daqing to build the facility with an annual production capacity of 10,000 tons. Production is expected to begin in September.
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The facility will produce tomato, pumpkin and other fruit and vegetable powders that can be used as ingredients in products like baby food, instant soup mixes, snack foods and confectionery.
According to the company’s estimates, the average selling price is estimated to be US$2,640 per ton with an average gross margin of 45%. The firm said it expects the new line to contribute around $13.5m in revenue for fiscal year 2011.
“The fruit and vegetable powder segment is a high-growth segment that complements our current product lines,” said Changjun Yu, chairman of China Nutrifruit. “We can leverage our supplier relationships along with our network of distributors to sell our new fruit and vegetable powder products.
“Entering this segment provides a more attractive return on investment than our previous plan of acquiring a concentrate pulp production line. We will continue to outsource production of our concentrate pulp products and may seek additional acquisition targets in the concentrate pulp segment in the future.”
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By GlobalDataThe company expects to finance the investment with proceeds from its recent financing deal in October and working capital from operations.
