Katilo For Dairy Products achieved sales of EGP 80m, including 20% exports, with plans to boost the latter by 10% in 2017.
Chairperson of the company Abd El Moneim Katilo said that he aims to expand to exporting dairy, especially cheese and yogurt, to the Gulf markets, the United States, and Canada, to take advantage of currency differences after the flotation.
He added that the company reduced its exporting prices following the flotation in November, which reflected on the size of its exports in the second half of 2016, compared with the first half of the same year, indicating an increase of 30%.
He explained that the increase in exports is the tool to meet the cost increase followed by moving the prices on the local market and reduction of costs through dispensing allocations for advertisements.
He pointed out that the rise in prices for cheese during the recent period was driven by increased production input prices, especially packaging materials, which hiked by 35-50%.
Next to increased milk prices, both powder and protein, the total increased input costs reached 50-80%.
He predicted the exchange rate to stabilise at around EGP 18 against the dollar in the first half of 2017, before taking a down curve to settle at EGP 12.
Katilo said that constructions in the company’s new 5,000sqm factory in the industrial zone in New Damietta will begin by the middle of this year, estimating investments at EGP 60m.
The company has been seeking the new expansions to maintain its production size for the domestic market and for exporting.
Katilo noted that the most prominent challenge facing the dairy sector are the fragmentation of livestock, lack of awareness of adequate means of proper milking methods, transportation, and conservation.
He estimated the production of the company’s livestock to be at 3% of the total produced dairy.
He added that the Netherlands has the same number of cattle as Egypt, but the production size is five times that of Egypt, due to the difference in strains.
He pointed out that the issuance of the unified food law will replace the multiplicity of regulators, which would save time and effort for exporters and tighten control on products.
He said that his company does not export to the countries of the European Union, due to the ban the former has instituted, even though Katilo obtained a membership of several international bodies including the US Food and Drug Administration and the International Dairy Foods Association. He urged the Ministry of Agriculture to work and complete the necessary measures to lift the ban.