SHAH ALAM: Central Sugars Refinery Sdn Bhd (CSR), a unit of Tradewinds ( M) Bhd, has allocated RM30 million in capital expenditure (capex) this year to improve the productivity and efficiency of its plant.
Chief executive officer Hishammudin Hasan said the company has embarked on its transformation journey from commodity-based to a fast-moving consumer goods company (FMCG).
“We want to transform, not only in terms of products, but also in mindset by employing more talents from FMCG companies.
“Part of the capex would be used to adopt new production techniques to enable the plant to produce better sugar for Malaysians,” he said during a media visit to CSR’s plant here yesterday.
In line with the transformation journey, said Hishammudin, CSR had embarked on a rebranding exercise aimed at educating and encouraging consumers to shift from consuming white sugars to brown sugars and to promote healthier living.
Sugar has been linked to a number of health problems such as obesity and diabetes, but the fact is, it is not the product that caused the problem, it is the lifestyle, he said.
Hishammudin said in November last year, the company introduced a new variant of brown sugar that has low glycaemic index (GI) and polyphenols – an antioxidant that helps in managing sugar level.
The sugar is currently being imported from Australia, but CSR had clinched the exclusive manufacturing and distribution rights for the low GI brown sugar and expected to produce it in Malaysia by year-end, he said.
“Typically, in other countries, low GI sugars are priced at a premium, but for us, it is placed in the mass market range because we recognised that Malaysians deserve a better sugar product,” Hishammudin said.
CSR had rebranded itself through its packaging as well as product diversification, and currently has more than 10 products and about 70 stock keeping units, he said, adding that its factory is now running at maximum production capacity of 50,000 tonnes per month.
Moving forward, Hishammudin said the company would continue to invest in research and development to come out with better sugar variants, with plans to embrace the Industry 4.0 by allocating a significant amount of funds to move into predictive engineering and artificial intelligence.
Meanwhile, chief operating officer, Victor Ng Chin Wei said the company aimed to produce 565,000 tonnes of sugar this year, 70 per cent for the industry and the rest for direct consumers.
“We are putting a lot of effort to grow the consumer side to 40 per cent in two years.
“We are doing a lot of brand building by investing in advertising and marketing. Sugar is seen as a commodity and we want to change the game to make it truly FMCG,” he said.
On the sugar tax which would be imposed starting from July this year, Ng said the company expected to see some drop in volume, but hoped that the move to expand the business into FMCG would be able to mitigate the impact.
CSR commands about 41 per cent of the local market share in terms of volume, he said, adding that growth in sugar industry was typically about 1-2 per cent per year.
“In terms of volume, we do not see any sudden rise, particularly in domestic consumption. But innovative value-added products could drive the business forward,” he said. –Bernama
