Protel has recently launched food and beverage capex project data in France, Belgium and The Netherlands. Following this development, this article aims to give an easy-to-digest run down of some of the industry trends picked up by our team of researchers.
In general, the food and beverage manufacturing industry in France, Belgium and the Netherlands is very buoyant. We are seeing lots of capex investment at a pre-sanctioned status, with projects being approved quickly and, in general, rarely placed on-hold or cancelled.
More projects are coming from France due to the size of the country & industrial base. However, investment value in Belgium and The Netherlands is still very high, with capex often around €50 million mark. We are seeing a good mixture of project types. These include complete new builds and updates to existing brownfield sites with companies making the most of their available space.
Foreign direct investment levels are high. Big players such as Indian company Petiva and the Korean SPC Group are opening manufacturing centres in Belgium and France respectively. There seems to be little worry over Brexit. Indeed, it is leading to more European investment in general as UK companies look to establish a base on the continent, often in the form of a storage facility or sales office.
In a similar trend to our UK coverage we are seeing more food than drink sector projects. This is due to the huge agri-food industry in France, Belgium and the Netherlands. Despite this, investment in the beverage sector is still high, with milk powder, dairy and juices being key growth areas.
Due to the high level of pre-sanctioned projects, engineering houses, architects and equipment suppliers are all very busy. The outlook for 2018/19 certainly seems positive. We are already reporting on projects from big names such as LDC, LSDH and Barry Callebaut. The new information adds a combined project value of over €1.61bn to our capex database MyProtel.
The agri-food sector in France is one of its most profitable business areas. Key investment is happening in potatoes and dairy products, while exports of wine and champagne remain to be an important economic driving force. The food manufacturing sector is the number one area for foreign investment, with international companies such as McCain, Mars and Barilla present in the country.
Capex levels are buoyant in France. LSDH plans to invest €250 million over 3 years to adapt its factories to new food trends, focussing on vegetal ranges. Carlsberg are investing €100 million in their Kronenbourg factory, while slaughterhouse company LDC have expanded their reach by acquiring Doux Group.
The Netherlands is one of the most innovative countries in the world with a very healthy R&D environment. They have three large food based universities in ‘Food Valley’, an area in central Holland containing a collection of R&D centres from companies such as Friesland Campina. According to our researchers, food could be argued to be a more priority investment area in Holland than pharmaceuticals. Advances in healthy nutrition to prevent illness are seen as more beneficial than the development of drugs to combat it.
With over 1300 foreign companies present, overseas investment in The Netherlands is high. Twelve of the world’s largest food companies including Unilever, Mead Johnson and Monsanto have production and R&D sites there. Kraft Heinz has recently opened their largest office outside of the US in Holland, while packaging manufacturer Greif has invested in a new €1million facility there.
The food and drink sectors in Belgium are two of its key manufacturing industries, amounting to €99 million this year. Chocolate, beer and baked goods are important export areas, with an average annual rise on exports of 5% year on year. Our researchers have also seen lots of projects going to sanction in the meat industry.
Much like the Netherlands, Belgium has high levels of R&D investment. Annually €237 million is spent in this area. Belgium is a global leader in ingredients, healthy food and processed meals. A large proportion of the Belgian food and drink profits come from the Flanders area. Additionally, in the Wallonia region of Belgium the Wagralim alliance brings together a group of manufacturers, universities and research centres. These companies are working towards more innovative and healthy food products.
We are currently tracking a significant number of active food and beverage project schemes across France, Belgium and the Netherlands with a combined potential investment value of over €1.61bn.
Some of the larger investors currently on the system (full projects details available to subscribers on our project database, MyProtel):