Specialty ingredients expert

HEADQUARTERED in Malmö, Sweden, AAK is a leading producer of specialty vegetable fats. It provides customised products in nearly all categories, with the majority ideal for use in the chocolate, confectionery, bakery, dairy, infant nutrition, and food service industries. 

The company also offers trans-free solutions for fillings for chocolate and confectionery products.

We spoke with Michael Skriver, the managing director of AAK Malaysia Sdn Bhd at Food Ingredients Asia 2014 in Jakarta, Indonesia, and discussed about food trends, growing markets, and functional cocoa butter alternatives for chocolate.

Michael Skriver, managing director, AAK Malaysia Sdn Bhd 

What main products did AAK showcase at FiA 2014?

We presented the Cocoa Butter Substitutes (CBS), Cocoa Butter Replacers (CBR), and Filling Fats during this year’s show. These products can be used in chocolate confectionery and bakery products. 

We also launched the second phase of the Akochoc™  ready-made chocolate-like compounds from AAK. 

Some of our customers have mainstream coatings or fillings that they make themselves. We now offer small batches for more special coatings and fillings. We are also looking to grow our products for baking. We want to deliver better fats such as high-quality shortenings or maybe whipping creams and fillings.

Are you seeing a new demand for certain products in Asia?

There is certainly a rising demand for high-quality fillings, especially in Indonesia and Thailand. 

Food manufacturers can now provide fillings measuring 3 mm to 5 mm, so much more than the 1 mm fillings typical of three or five years ago. The improvement in quality complements the quantity. So there is a much better experience with fillings now. The fillings melt so fast you can taste the sugar, vanilla, and cocoa all at the same time. There's a taste explosion because the fat is good.

Akochoc ready-made chocolate-like compounds from AAK

Do you see a shift in the Asian private labels?

Private labels continue to grow stronger. A lot of these are either very low-cost operations or a clear copy of a global A-brand at less cost. If you're not a global A-brand, you risk private labels taking over your products and market. 

Many of our customers come to us and discuss how they can be a local A-brand. They don't want to go into private labels, because they know that's tough. If they want to expand as a local A-brand, we help them to expand their range.

What are the big trends in the industry?

One of the key trends now is “to indulge.” The middle class, in particular, want this experience as part of their wealthier lifestyles. The other trend focuses on healthy products. 

As a Scandinavian-based company, we have the experience and advantages to grow this healthy trend. Denmark was the first to alert everyone about the negative effects of trans fats. A year ago, it was only the leading brands that wanted their products free of trans fats, but now it’s everybody. I think the wave will come through Asia in the next two years. You can also see the shift from rice-based foods to more breads, like pizzas and cakes.

You’re also in the dairy products market. What are some focus areas for you in this sector?

One of the main growth areas in dairy products these days is whipping creams. People want nice whipping creams with good flavour release and freeze-thaw stability. 

We also offer a lot of processed cheeses made completely from vegetable fat. With this, we can make mature cheeses with a natural cheese flavour, nice taste and good melting properties. 

Another key area is infant products. We are one of the world’s leading suppliers of solutions for custom-designed oil blends for infant nutrition. In addition to lactose and proteins, human breast milk supplies fats that can provide 50% of an infant’s dietary calories besides energy. These, however, act as source of essential fatty acids that cannot be synthesised by the human body. 

Our Akonino® product is an alternative for breast milk. It contains ingredients with unique properties and the fatty acids in the exact proportions needed by babies and infants. These are extracted from natural sources and blended with exceptional precision, making them healthy for babies, infants, and even young children.  

AAK is big on corporate social responsibility.  Can you tell us about some of the company’s activities?

We involve our workforce, community, and even how we source our raw materials in this endeavour. For example, in our products with palm oil, we need traceability. 

Another specific product is the shea tree from Africa. We actually work together with the United Nations all the way into the bushes of West Africa. Almost two million women are working on collecting shea kernels. We make sure that they help to organise themselves in small groups so it’s not the middle men who profit. Our work in these areas includes the formation and teaching of women’s groups in villages and by doing direct business with them we help them markedly improve their livelihood. We’ve grown this so big now, probably the United Nations or a non-governmental organisation will grow this even further. This is an amazing story, I think.

Tell us about your presence here in Indonesia. What can you offer this growing market?

Before, the demand was mostly for low-cost products. Now, however, companies want to deliver a good experience, and they want to supply to all corners of Indonesia. 

These companies need a product that is more stable, a product with a longer shelf life. All these create a demand for what we can deliver. 

We might not be the cheapest, per kilo, of raw material. But if you look at the value that we deliver to the customer, we enable customers to sell much more with much less rejection, produce faster, and offer products with a longer shelf life. This is a more cost-effective strategy as our customers will be able to sell more because they will have a premium product. 

What is your outlook for Asia next year?

We are very positive about Asia. Customers want high-end products. This is good for our company because we know we can deliver value.