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INTERVIEW: Nuscience Plans to Strengthen Presence in Southeast Asia

sat, 26 jul 2014
Source: Feedinfo News Service 26 June 2014 – When Nuscience Group launched its Aromabiotic® range almost 10 years ago, the global market for antimicrobial growth promoters (AGP) replacements was in its infancy. Mounting public concerns about the overuse of antibiotics in feed, as well as evolving regulatory landscapes in many parts of the world have changed that, and provided the Ghent, Belgium-based company with new market growth opportunities.

Nuscience is now planning to take Aromabiotic®, its Medium Chain Fatty Acids (MCFA) range, to Southeast Asia, where consumer pressure is expected to continue pushing meat producers away from AGPs in the coming years.

Katrien Deschepper, Nuscience Group COO, provided Feedinfo News Service with her view on the growing demand for antibiotic alternatives in that region, and on the opportunities that Nuscience sees in other emerging markets such as Russia and Brazil.

Cracking the Southeast Asian Market

Nuscience has been selling its MCFA range – which consists of Aromabiotic® Pigs, Aromabiotic® Poultry and Aromabiotic® Cattle – in countries such as Korea, Japan and Taiwan for some time now, where demand for AGP replacements is growing year on year.

“South Korea has followed Europe’s lead to ban the use of AGPs, as later did Bangladesh too. To meet the requirements of importing countries, producers exporting poultry from countries like Japan, Thailand, Australia and New Zealand have also voluntarily stopped using AGPs. We are very happy with the growing use of our Aromabiotic® in these markets as many producers have found it to be an ideal replacement, if not a better alternative to AGPs,” explained Deschepper.

But Nuscience now wants to take its expansion plans a step further, and penetrate Southeast Asia.

Deschepper acknowledges that Nuscience’s mission will not be easy, as poor management levels and a lack of legislation still contribute to the continuing use of AGPs in this region. However, the Nuscience COO believes that the time is ripe for the move.

“We foresee that the use of prophylactic antibiotics will stagnate. There is a lot of growing pressure from supermarket chains and consumer groups throughout the region,” she said.

Deschepper went on to say that Nuscience’s Aromabiotic® range has had a very good reception in countries where antibiotic growth promoters are still allowed.

“In Asian countries, a lot of antibiotic cocktails are used not only as growth promoters but also to fight against the high infection pressure which is often the reality,” she noted.

“Aromabiotics work very well in these conditions: they help lower the infection pressure and promote the health of the animal. As a result, the need for antibiotics as well as the risk of antibiotic resistance is lowered.”

In China, where Nuscience has been present since 1996, pork producers have recently been affected by low prices. Nevertheless, Deschepper hopes that the industry is now entering a period of growth. “Our strategy in China today is to grow our existing companies instead of creating more companies in different areas. With two strong operational companies, we are faster in implementing innovations,” she said.

“Nuscience wishes to become the knowledge partner for the industry, to educate the technical staff of feed companies as well as farm managers and owners operating farms on the benefits of using Aromabiotic® and respond to the increasing consumer demand for natural meat and egg production,” she added.

In addition to its products based on MCFA, Nuscience also offers its Asian customers health solutions such as Vitanox®, a natural antioxidant countering oxidative stress; Vitafix®, a range of detoxifying agents; Vitagal®, a powerful soy enzyme; and Vitamul®, a nutritional emulsifier.

An Adapted Market Approach

Two years ago, Nuscience Group’s CEO Patrick Keereman told Feedinfo News Service that the company was expecting “significant improvements” in terms of market presence for its existing products such as the Aromabiotic® range thanks to an adapted market approach.

According to Deschepper, this approach included the creation of two business units through which Nuscience products are currently sold: Health4U and Nutrition4U. Both units have a specialized and focused sales team, whose job is to bring the nutritional products (young animal nutrition, premixes, concentrates) and the health products (Aromabiotic® and functional feed ingredients) to the market.

“The Health4U team is working globally and allows us to be active in markets that could not be reached with our Nutrition4U products,” she says. “This focused and global approach has certainly been the basis of our actual important growth of Aromabiotic and other Health4U products. At the same time, there is a ’cross-fertilisation‘ between both business units allowing us to be the nutritional knowledge partner adding value for farmers, integrators and feed producers, in areas that really matter to them,” said Deschepper.

She argued that Nuscience will continue to focus on innovation, and place customers at the center of its R&D efforts. “Our customers are key in our innovation processes: challenges of customers are turned into solutions. A good example is Vitadys® which was developed together with veterinarians as a preventive nutritional measure. DOC Star®, a brooding complement for day old chicks has been developed to increase the uniformity.”

In addition to Southeast Asia, Nuscience also hopes to strengthen its foothold in other emerging markets. Serbia, for example, where Nuscience acquired a 51% interest in premix producer Novi Mix (Nuscience Premix International) last year, is seen as a “door opener” to the Russian and central European markets.

Nuscience’s acquisition in 2013 of Brazil’s Metachem Nutrients (a manufacturer of organic acid solutions) is also seen as strategic.

“Metachem Nutrientes, which has now become Nuscience Nutrientes do Brazil, is an important acquisition for our group as this brings us into a new market with specific needs. As such we have acquired a position in the top segment of the feed market and we will be able to add on very specific products of our current range to be marketed in Brazil,” said Deschepper.

Even if Deschepper confirmed that Nuscience’s growth strategy will continue to be based on organic growth, she does not rule out the possibility of new acquisitions. “We are working on both levels to make the growth happen. We have targeted some markets on which we want to take a position in the coming years.”