Ajinomoto Co., Inc. : Nissin Ajinomoto Alimentos Ltda. to Start up New Plant in Northeast Region of Brazil Aims to Expand Business in Fast-Growing Instant Noodle Market Start of Operations in November 2012
11/12/2012 | 10:33pm EDT
Nissin Ajinomoto Alimentos Ltda. to Start up New Plant
in Northeast Region of Brazil
Aims to Expand Business in Fast-Growing Instant Noodle Market
Start of Operations in November 2012
TOKYO, November 13, 2012 - Nissin Ajinomoto Alimentos Ltda., a joint venture in Brazil between Ajinomoto Co., Inc. (Ajinomoto Co.) and Nissin Foods Holdings, will start operations at a new instant noodle plant in the Northeast Region of Brazil in which it has invested approximately JPY 1.8 billion.
Completion of the new plant, which will commence operations in November 2012, will enable Nissin-Ajinomoto Alimentos to further expand its business in Brazil's fast-growing instant noodle market.
1. Background of the New Plant
Since its founding in 1975, Nissin-Ajinomoto Alimentos has contributed to the establishment of the instant noodle market in Brazil. It had a market share of 60 percent as of 2011, and currently has a plant in Ibiúna in the state of São Paulo.
Brazil's economy is expanding steadily due to a growing population (about 190 million in 2010 according to UN estimates) and increasing domestic demand. Economic growth is expected to continue.
Meanwhile, the instant noodle market continues to expand, supported by a rising standard of living and consumer acceptance of the convenience of delicious meals that are easy to prepare. The size of the Brazilian instant noodle market was approximately 2.1 billion servings in 2011 (10th largest in the world), and is projected to continue growing by about 5 percent annually.
Growth is particularly remarkable in the Northeast Region, which in 2011 grew by more than 10 percent over the previous year and has become the country's largest market for instant noodles.
2. Purpose of the New Plant
The Ibiúna Plant is located in the Southern Region of Brazil. Consequently, the market share of Nissin-Ajinomoto Alimentos in the Northeast Region has been lower than its average share nationwide because of price competition from local manufacturers with nearby plants. By building the new plant, the company aims to solidify its business foundation in Brazil by strengthening its cost competitiveness in areas such as distribution costs and by enhancing region-specific marketing to further increase its share in the largest regional market. In addition, with the reserve capacity of the Ibiúna Plant the company expects to expand sales to Argentina, to which it already exports.
3. Overview of the New Plant
4. Overview of Nissin-Ajinomoto Alimentos Ltda.
5. Significance of the New Plant for Ajinomoto
Strengthening and growing the overseas consumer foods business is one of the key principles of the 2011-2013 Medium-Term Management Plan aimed at making Ajinomoto a genuine global company. The construction of the new plant will promote sustainable growth of the Ajinomoto Group's instant noodle business, and lead to business expansion in Brazil.