May 22, 2023
Malayan Flour Mills to invest in Tyson poultry integration JV
Malayan Flour Mills Bhd (MFM) intends to invest at least RM135 million (US$) in capital expenditure (capex) on its poultry integration-based joint venture, Dindings Tyson Sdn Bhd (DTSB), this year.
DTSB is a joint venture with Tyson Foods in which MFM holds a 51% equity stake. MFM executive deputy chairman and managing director Teh Wee Chye said the company is confident in the prospects of the poultry integration segment.
"Importantly, the segment maintained its momentum of volume optimisation in line with the rising demand for our processed meat from our customers in the quick-service restaurants and food manufacturing sectors," he said in a statement. Thus, MFM intends to invest in the segment alongside its joint venture partner in order to expand the capacity of the poultry processing facilities.
"While our flour and grain trading segment was affected by a confluence of factors that impacted our regional flour milling operations, the poultry integration segment's profitability is on the rise," Teh added. "In a challenging environment for our flour and grains trading business, we will continue to focus on assuring cost-effectiveness in our flour milling operations through improved flour extraction and blending techniques."
He revealed that the capex would be used to upgrade the company's primary poultry processing plant in Sitiawan, Malaysia.
With the upgrade, MFM would increase the slaughtering capacity of the processing plant by more than 20% to 340,000 birds per day, from 280,000 birds per day currently.
Capex for the expansion will be funded by both internally-generated funds and bank borrowings.