June 3, 2021

San Miguel to spend US$630 million on building new feed mills

San Miguel Food and Beverage Inc. (SMFB), the food unit of conglomerate San Miguel Corp. (SMC), will spend an additional P30 billion (~US$630 million; P1 = US$0.021) in capital expenditures this year to expand its existing feed mills and build seven new ones, BusinessMirror reported.

The expansions include SMFB's feed mills in Echague in Isabela City from its current capacity of 500,000 tonnes per year, San Ildefonso in Bulacan, Sta. Cruz in Davao and Mandaue in Cebu.

"And we are also in the process of building seven new feed mills. And these are greenfield projects of which each of this project cost about I think US$50 million," Ramon S. Ang, SMFB president and CEO Ang said during SMFB's stockholders' meeting. He did not elaborate on the location of the new feed mills.

SMFB said its protein segment, which posted an 11% year-on-year growth, continues to recover from improved market demand-supply dynamics.

The company added it was able to adapt to changes by launching its community resellers programme, which currently has about 11,000 active resellers, to enhance availability and consumer access to its poultry and other products.

Specifically, its prepared and packaged food segment continues to shine, growing 6% helped by consumers preferring at-home dining.

SMFB is the biggest feed producer in the Philippines and operates a network of 37 feed mills across Luzon, Visayas and Mindanao.

The food unit recently built six new feed mills of which two facilities are in Luzon, in Bataan and San Ildefonso, and two in Davao and Misamis Oriental.

For the Animal Nutrition and Health segment, compound feeds are produced at 14 company-owned feed mills, seven of which are located in Luzon, three in Visayas and four in Mindanao. Most of these plants are capable of producing pelleted and crumble feeds and two plants have extrusion capabilities to produce aquatic floating feeds.

The feeds business also maintains tolling arrangements for eight rendering facilities that convert animal by-products into specific feed types.