In the traditionally dairy-heavy Food Solutions business division, the focus in 2021 was also on the development of new products with high functional added value. This initiative resulted in additional lactose-free milk powders, vegan powders for the production of the finest chocolate and two high-quality semi-finished products for infant formula. In addition, demand from the chocolate industry recovered significantly and is back at pre-Covid levels. Food Solutions achieved net sales of CHF 218 million.
Manufacturing spray-dried lactose-free milk powders is a challenging process. HOCHDORF has this expertise and is therefore the only Swiss supplier of various lactose-free milk powders. The powders have an excellent, milky-sweet taste. For industrial processing, this means that less added sugar is required, which is in line with the nutritional trend in this area. The demand for our new lactose-free skimmed milk and protein powders is exceeding expectations.
Following the trend for plant-based products, HOCHDORF developed a spray-dried and roller-dried powder for the production of tasty vegan chocolate. We based this on our tasting experience with the finest Swiss milk chocolate. The positive reactions of test customers for chocolate tasting and numerous test orders are clear proof that we are on the right track.
In addition to cow's milk, HOCHDORF also dried Swiss goat's milk to produce high-quality whole goat milk powder in 2021.
In cooperation with a new customer, we have expanded the product range for special nutritional requirements for infants (FSMP) to include a high-quality fat powder made from sustainable coconut oil. The purely vegetable semi-finished product meets the high microbiological requirements for infant formula.
After the completion of the second project phase of our whey competence centre in Sulgen, we will process the delivered whey into valuable semi-finished products for our infant formula. This allows us to add even more value and Swissness to our products. The semi-finished product was previously delivered from the Netherlands. By producing locally, we avoid more than 25,000 lorry kilometres and reduce the environmental impact by at least 20 tonnes of CO2.
Demand for milk powder for the production of chocolate is back to pre-pandemic levels. Orders in the second half of the year in particular were above average. This is due to restocking as a result of transport bottlenecks and the opening up of new sales markets by chocolate manufacturers.
With net sales of CHF 218.0 million (+ 5% compared to previous year), the Food Solutions division exceeded expectations. This was due to the higher than expected share of sales for products supplied to the chocolate industry. However, the higher milk price also led to an increase in turnover.
Product developments in the area of Smart Nutrition will remain a focus in 2022. We attach great importance to the further expansion of our range of plant-based and goat's milk products. In the lactose-free milk powder product group, we expect sales to grow in the first quarter – albeit at a low level.
Milk will continue to dominate the Food Solutions division as a raw material for the time being. The extent to which the objective milk cost increases are passed on to the processors requires a better partnership solution moving forward. With the decision to concentrate production at the Sulgen site from 2024, HOCHDORF is endeavouring to ensure security of supply for its customers, provided this is commercially sustainable.