Oatly Partners With Yeo’s For US$30M Asia Oat Milk Factory In Singapore, First Time Outside E.U. & U.S.
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Swedish oat milk maker Oatly is partnering with Singapore-headquartered Asian heritage beverage giant Yeo Hiap Seng – known as Yeo’s – to jointly invest US$30 million to begin producing the brand’s oat milk for the first time outside of the U.S. and Europe. Yeo’s facility in Singapore will start production by mid-2021 to supply the Chinese market and subsequently the wider Asian market to meet the surging demand for plant-based alternatives across the region.
Singapore beverage giant Yeo’s, known for its range of Asian food and drinks products, has forged a long-term partnership with Swedish food giant Oatly to manufacture the famous plant-based oat milk, the firm announced on Monday (March 29). Jointly investing US$30 million for equipment and facilities, the Senoko Way-based plant will begin producing Oatly’s popular enzyme-treated oat milk by the second half of this year, with the first batch earmarked for the Chinese market.
Yeo’s will be managing, operating and maintaining the new facilities producing Oatly’s TetraPak packaged products to supply markets across Asia, including in Singapore, where the brand made its first entry in late 2020.
Oatly’s Singapore launch came after its major partnership with Starbucks to add new plant-based options in eight Asian markets and in mainland China, the biggest and most lucrative of all markets in the region eyed by many startups as the key to drive the sustainable food revolution.
We are delighted that Oatly, a world leading dairy alternative brand, has chosen Yeo’s as its first Asia strategic partner and Singapore as its manufacturing location.Samuel Koh, CEO, Yeo’s Group
The first time that Oatly’s popular plant-based beverage will be manufactured outside of the U.S. and Europe, the move to launch a Singapore production and bring production to the region signals the strong demand to come from Asia, especially in the coming years with industry experts highlighting the region as the fastest-growing market.
For heritage brand Yeo’s, the strategic partnership will be an important avenue for growth and to remain relevant with consumers who are increasingly shifting to healthier and sustainable non-dairy alternatives, a trend that has only accelerated since the pandemic.
“We are delighted that Oatly, a world leading dairy alternative brand, has chosen Yeo’s as its first Asia strategic partner and Singapore as its manufacturing location after strict due diligence. This strategic partnership positions both companies to tap the surging demand in this region for plant-based dairy,” commented Samuel Koh, CEO of Yeo’s Group.
“We believe that this segment will continue to grow exponentially as consumers become more aware of the impact of their food and beverage choices on their health and the environment,” Koh added.
We believe that this segment will continue to grow exponentially as consumers become more aware of the impact of their food and beverage choices on their health and the environment.Samuel Koh, CEO, Yeo’s Group
Johnny Teo, executive director for food, healthcare and biomedical at government agency Enterprise Singapore, says that the strategic partnership also represents a further cementing of Singapore’s reputation as a leading sustainable food tech hub for the Asia region.
“This collaboration between Yeo’s and Oatly is an example of a strategic cross-border partnership that capitalises on complementary capabilities among different players in the food ecosystem, which we hope to see more in Singapore,” commented Teo.
Singapore famously became the first country in the world to give the go-ahead to sell cultured chicken, which paved the way for San Francisco food tech Eat Just to make the city-state its Asian headquarters to house its plant-based egg and cell-based meat production facilities to supply the region, and has partnered with Proterra to build its Asia supply chain.
While the latest news of Oatly’s plans to bring production to Singapore indicates its intentions to double down its presence in the continent, it’s not showing any signs of slowing down in other markets either. The food tech recently announced that it will open “one of the world’s largest plant-based dairy factories” by 2023 to supply the British market.
The surging global demand translating to its triple-digit sales growth for three consecutive years has prompted the Blackstone-backed company to file to go public in the U.S., where it is reportedly seeking a value of US$10 billion.
Lead image courtesy of Yeo’s.