Lupin industry to succeed

26 May, 2014 01:00 AM
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I think this is a transformational project that positions lupins as a human food and it will grow.

HOPES for a vibrant WA lupin industry could only be several years away.

Lupin Foods Australia (LFA) – a wholly owned subsidiary of CBH – opened its new milling facility late last year and has directed its focus on marketing lupins as a new health food alternative on the domestic and global market.

Following its first harvest in WA, LFA general manager David Fienberg said while the new company was ticking along nicely since opening last November, it had a long way to go before it would reach its full processing capacity.

"There is probably about 250,000 tonnes of lupins consumed domestically between dairy, stock feeders and local manufacturers that bypass the system," Mr Fienberg said.

"We don't really know what our total share is, but if we look at total exports then we are probably consuming less than 10 per cent of lupin volumes in WA at the moment, maybe even less."

Mr Fienberg said while it would take a few years to hit production capacity, LFA was starting to edge up processing volumes.

With a decline in WA lupin production figures in recent years due to a lack of competitive returns and limited market access, Farm Weekly asked Mr Fienberg how LFA planned to increase grower confidence to ensure an on-going consistent supply.

"In the short term we are not too worried about it," he said.

"Our total capacity is only 150,000t and I think we can get that from what is being supplied at the moment.

"I think this is a transformational project that positions lupins as a human food and it will grow, but it will take us a few years to get there and we need more milling capacity, well above 150,000t.

"Hypothetically if we had 500,000t milling and lupin food processing capacity I would think we'd have some influence over the lupin price."

But Mr Fienberg said he didn't know whether LFA planned to increase milling capacity in the future.

"If we can establish a global demand where we need more lupins we will need more milling capacity," he said.

"It is still early days but we are doing quite well and as demand goes up our next step would be to build a major processing capability."

Mr Fienberg said LFA supplied the South East Asian and the Middle East markets and saw China, Japan, Korea and India as exciting market opportunities.

With lupins for human consumption recently granted market access to India, Mr Fienberg expected to access the market in the near future.

"India is the biggest legume consumer so that is a really exciting market," he said.

"We submitted an application three years ago but we re-submitted in March after we heard the country was going to allow lupin imports.

"We expect when India does drop the borders in the next three weeks, from the good contacts we have established, there would be good activity for demand.

"Our strategy is not to just take a food to India and expect everyone will buy it, it is a matter of market development, food taste and matching it with their different cuisines.

"Food is very parochial and consumers protect their dahls and curries and it is 1000-year-old food and manufacturing, so we're all about trying to work with the local food companies to concentrate the taste.

"The existing foods are great but the new foods taste great and have the added functionality of ameliorating the effects of obesity and diabetes.

"This is where you can have a unique selling point and then it will start slowly."

Mr Fienberg said LFA hoped to gain access to Korea, Japan and China within the next two years.

"Those three countries don't allow lupin products to be sold but we hope to be able to chip away at that," he said.

Mr Fienberg said there had been delegations from and to China and Japan in recent weeks, comprised of government officials and private parties.

"That is a collective group that the private sector have bought out here to say, 'come out here and have a look, we really need these foods so give us access to it'.

"Even though LFA is part of CBH, as a small company we have got to run on our own steam though we don't have the resources to continually chip away at these international markets.

"We work with large food groups so they can do the work.

"It is better off if Chinese, Japanese and Korean insiders are actually banging on the door to their governments saying this is a good food, it does good things for our people, let us access it – as opposed to us banging on the front door.

"China is a fantastic opportunity mainly because they are concerned about the quality of food – which is why a lot of WA products do well up there.

"We think we can piggyback off that reputation."

Mr Fienberg said there was good potential for lupins in the gluten-free and health food markets in Western Europe.

"We are a long way off being successful in there but we think we know what we need to do and we have started to work on this," he said.

"We've got some fairly influential partners that are pushing our barrow so we hope in the near future we will be able to achieve significant orders and fill up the capacity of our mill.

"That will drive questions about whether we need more processing capability and investment and then we might have an impact on the price of lupins – but not just yet."

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