Fiberstar plans to expand in Brazil
August 07, 2009
by FoodBusinessNews.net Staff
WILLMAR, MINN. — Fiberstar, Inc. is in the process of forming a Brazilian subsidiary and is seeking to build a production plant in Brazil to complement the plant it runs in Florida, said Dale Lindquist, president and chief executive officer of the Willmar-based company that manufactures the Citri-Fi line of products. The subsidiary will be called Fiberstar Participacoes Do Brasil Ltda.
"We have negotiated the terms of a 15-year raw materials supply contract with one of the major orange juice producers in Brazil," Mr. Lindquist said. "The agreement will be signed as soon as Fiberstar is given legal status."
The production plant will be built on a 5,500-square-meter site about 250 miles northwest of Sao Paulo, Brazil. A local city has made it possible for Fiberstar to obtain the site at no cost, Mr. Lindquist said. The company will finance part of the construction cost through an economic development loan from the Bank of Brazil.
"The addition of Brazilian production will enable us to take advantage of the counter seasonal production between the northern and southern hemispheres," Mr. Lindquist said. "We will also be able to reduce the level of inventory to sales we have been required to carry with only northern hemisphere production."
Fiberstar, a privately-owned research and development company, holds an exclusive worldwide license for patented biotechnology developed at the University of Minnesota. Citr-Fi, an ingredient made from citrus pulp, may add moistness, control moisture migration, improve yields, replace fat and reduce the cost of a variety of food products, according to Fiberstar.
The company said sales of Citri-Fi increased 27% for the seven-month period ended July 31 when compared to the same seventh-month period in 2008. Sales for the 12-month period ended July 31 were 26% higher than the previous 12-month period.