Swedish-Danish ingredients firm AAK is gearing up to open a new coconut oil plant in the Philippines by the year’s end as a part of the firm’s programme to expand its footprint in Asia-Pacific.

The plant in Batangas, around 100km from Manila, was co-located with a San Pablo Manufacturing Co and was projected to become operation by the end of 2018, wrote Food Navigator Asia on 9 July.

AAK Singapore’s Southeast Asia regional director Michael Skriver said the location was near many of the firm’s customers and offered good inbound and outbound logistics for the Philippine market, in addition to its proximity to a container harbour and jetty for bulk vegetable oil shipping.

“There is a growing demand for sustainable and traceable coconut oil on the global market. The traditional coconut supply chain is long and complex because the growing areas are far away from the mills that extract the oil from the copra,” Skriver said.

“With the presence in the Philippines, AAK and the mill can directly pick up copra from the farmers and provide training and equipment as a means to ensure that a bigger share of the value goes to the farmers. We will also source coconut oil to other AAK mills in China, India, the USA and Europe,” he added.

The Philippines plant would initially focus on supplying the chocolate and confectionery fats and dairy and special nutrition sectors.

According to Skriver, opening the facility was a part of AAK’s drive to improve its presence in the Asia-Pacific region to respond to the fast-growing organic demand in all Asian markets.