French supplier Epi Ingredients takes on infant nutrition challenges in Asia expansion plans

With a presence already established in Japan, China and South Korea, the company has one foot in the door. However, it is facing challenges in China when it comes to getting approval for its infant-grade skim milk powder and stage 1 to stage 3 infant formulas.

These products are part of Epi's OEM (original equipment manufacturer) business, meaning it will supply them to local importers and companies for use in finished products. 

Speaking to NutraIngredients-Asia​ at the recent FI Asia in Bangkok, marketing manager Mathieu Lucot said: “We do have an exclusive distributor in China. We have good business there, but infant nutrition is a very specific category for which we need separate registration.​

“It’s become more and more difficult because of changes in regulations. But for other ingredients, (the rules are) more flexible; it’s not as difficult to get approval for them as it is for infant nutrition products.”​

A major investment

To this end, Epi recently invested €80bn in its dry ingredients division, which includes a new dedicated infant nutrition building in France, where it is headquartered.

Lucot said, “We built this (drying) tower specifically to develop products for infant nutrition. All the processing is infant-grade, we make complete infant formula, and we also have canning facilities.”​

One such product is low-spore skim milk powder meant for use in UHT beverage formulations. UHT beverage manufacturers often face the issue of spores becoming heat-resistant and as such, impossible to eradicate via UHT.

According to Lucot, Epi "will be able to apply extremely strict manufacturing standards that will help reduce spores in our products to the very minimum, so that UHT beverage manufacturers can use our ingredients knowing that their ready-to-drink beverage will be perfectly clean and stable, with no risk of further contamination by spore development”​.

The company has already registered its aformentioned infant nutrition products for sale in China, and is currently awaiting approval.

Difficulty level: Asian

Outside of China, Japan and South Korea, Epi has expressed interest in setting up shop in South East Asia.

Lucot said, “We would like to develop our existing business in Japan, China and South Korea, but we would also like to go into Indonesia. It’s not an easy market to penetrate, but it’s one of our goals to enter that market.”​

He added that Epi was also considering the Philippines, although the sheer size of the country’s market presents its own challenges, especially since most of its imported infant nutrition and dairy products come from Australia and New Zealand.

“It’s not easy for European companies to penetrate this market because our prices may not be competitive enough when compared to Australian and New Zealand companies.​

“That’s why one of our goals is to develop specialised, specific products that deliver quality nutrition to justify their slightly higher prices.”​

Driving innovation

Apart from infant nutrition, the company produces buttermilk powder, caseins, whey products and fortified powdered milks.

It recently launched a yogurt-based finished product concept called SoFlexi, an individually packaged powdered mix with which consumers can make a variety of yogurt-flavoured snacks. 

Lucot said the objective behind the product is not just to sell a concept, but to “drive innovation”​.

“We want to approach potential customers and let them taste the product, so they can come up with ideas to develop new products. It could be a beverage, a baked good, even something savoury — there are many applications for SoFlexi.”​

At the moment, the company counts 60% of its business in Europe, 20% in Africa and the Middle East, 10% in Asia, and 10% in South America, with a €250m yearly revenue.