The move follows on from Salalah Mills’ announcement in August of a US$10m bag production plant, which will have a planned capacity of 48 million plastic bags a year. The Austrian packaging equipment maker said it expected to supply a full range of equipment, including a tape extrusion line, winders, circular looms, and lamination and conversion lines, to the plant by mid-2016, in line with the factory’s planned opening at the end of the year.
‘Biggest GCC packaging company’
Currently Salalah Mills buys all the packaging for its range of flours from external suppliers – but aims not just to become self-sufficient in terms of packaging, but also to become a net producer for the whole GCC.
Ahmed Alawi Al Dhahab, CEO of Salalah Mills, said: “We have great ambition to be the biggest packaging company in Oman and the area of the Gulf Cooperation Council.”
The miller mostly uses woven polypropylene bags for its flours. With the new plant and equipment from Starlinger, Salalah Mills will become Oman’s first producer of AD*STAR multi-purpose bags, according to the equipment manufacturer.
“Oman does not only have a lot to offer as a tourist destination, it is also an attractive economic location. We are delighted to work together with such a renowned business partner as Salalah Mills and will do everything we can to make this project a success,” said Hermann Adrigan, sales director at Starlinger.
$30m in projects
Salalah Mills has announced a major expansion drive in recent months, with plans to build a new US$19.5m flour mill, for completion by 2017. The mill, with a production capacity of 600 tonnes of flour a day, will add 40% to the company’s current capacity.
The firm’s stated ambition is to become the biggest flour miller in Oman, and one of the largest in the whole of the GCC, thanks to these mill and packaging projects, which total almost US$30m in investment over the next two years.
But Salalah Mills will face significant competition, both within Oman and outside. In the Sultanate, Sohar Port’s own flour mill is under construction, and will add significant capacity – and in Saudi Arabia, the government has announced plans to sell off the country’s flour mills, potentially opening up the market to competition and outside investment.