Growing from flour to feed

by Meyer Sosland
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Hazaa Investment Group
Al Hazaa Investment Group entered the Jordanian feed industry in 2008 and in 2016 doubled production capacity at the facility.
 
Al Hazaa Investment Group began with one flour mill in Iraq in 1942 and through strategic investment and expansion has extended throughout the region into multiple sectors and industries. The company’s businesses now include grain storage, plastics, pasta production, grain milling and other investments in large corporations across the Middle East. The company operates in Iraq, Jordan, United Arab Emirates, Egypt and Cyprus.

The founder, Sharif Al Hazaa, established the philosophy of the group, which is to build strong foundations in major market fields and focus primarily on activities that would contribute to the economy of Iraq. The second generation of the Hazaa family now plays an active role in the management of the company.

“The group today owns many silos to store grain, a number of mills to make flour, macaroni factories, feed plant and plastic companies to produce the required bags for flour, grain and animal feed,” Khalid Al Hazaa, general manager, told World Grain in a recent interview.

Hazaa Investment Group
Jamal Al Hazaa, CEO

In the late 1970s, Jamal Al Hazaa, Sharif’s eldest son, with the assistance of his brothers, Omar and Khaled, took over management of the group. Together, they grew Al Hazaa Investment Group into a leading industrial business in multiple industrial sectors across the Middle East. Now in its third generation, seven members of the family have joined the business and work in the company’s plastic, flour milling, feed milling and industrial manufacturing businesses.

Today, the company operates nine milling facilities in four countries and has a total daily flour production capacity of 3,550 tonnes. This growth took decades of careful planning and investment, the company said. The expansion began with the building of a series of new flour mills in Iraq during the 1970s and early 1980s. Al Ahram Wheat Grinding Co. was established in 1973, and its flour mill located in Baghdad now has production capacity of 200 tonnes per 24 hours.

In 1977, the family established Al-Farouq Co. for Grain Milling in Northern Iraq. Today, the mill has a production capacity of 250 tonnes per 24 hours and a 5,000-tonne grain storage capacity. Al-Mashriq Co. for Grain Milling was established in 1980 in Southern Iraq. Al-Mashriq mill has production capacity of 250 tonnes per 24 hours and a 3,000-tonne grain storage capacity.

Al-Rafidain Co. for Grain Milling operates a mill at the site of the company’s original mill. With production capacity of 300 tonnes per 24 hours and 10,000-tonne grain storage capacity, the facility is considered one of the largest flour mills in Iraq.

Al Hazaa Investment Group’s milling capacity expansion across the greater region occurred in the 1990s and 2000s. The Gulf Industrial & Development Co. was established in South Amman, Jordan, in 1994. Today, it operates two production lines with total capacity of 840 tonnes per day.

The Jordanian Flour Co. was established in 2001 with the building of the Marka Mill in the Northern Amman region of Marka. The 300-tonne-per-24-hour mill has a 5,000-tonne grain storage capacity and was built by Bühler.

Al Hazaa Group acquired the Raghadan Mill in 2005 and proceeded to revamp its equipment and supply it with well-trained and qualified staff that enabled the mill to produce highly competitive products in the market. The Raghadan Mill has production capacity of 450 tonnes per 24 hours and grain storage capacity of 10,000 tonnes.

The company moved into the Egyptian grain processing market with the 2005 establishment of the Crown Mill. The mill’s production capacity is 640 tonnes per 24 hours and has a 35,000-tonne grain storage capacity.

After establishing Al-Ain Flour Mill in 2010 in Ajman, United Arab Emirates, Al Hazaa Investment Group became established on the Arabian Peninsula. The mill, known for focusing on the production of high-quality products, has a production capacity of 320 tonnes per 24 hours and a 15,000-tonne grain storage capacity.

Al Hazaa Group also has developed its pasta production with Al Jadeda Foods Co. in Jordan and Al Iraq Pasta Production Co. in Baghdad. Al Jadeda Foods has a vast range of products, including long and short pasta, Chinese noodles and extruded potato, corn, wheat and rice items. The company has a packaging facility that includes bulk packaging in 5-, 10-, 20- and up to 1,000-kg bags for restaurants, hotels and the armed forces.

Al Iraq Pasta Production Co.’s four production lines feature the latest equipment. It has a production capacity of 35 tonnes per 24 hours and produces all kinds of pasta from macaroni, noodles, spaghetti and more.

Growth Opportunities 

Hazaa Investment Group
These silos at Al Hazaa's Jordanian feed mill are used to store grain prior to processing.
 
Seeing further business opportunities, in 2008 Al Hazaa Investment Group launched the Global Feed Mill Company in Jordan and built a feed mill to keep up with the growing demand for feed in Jordan and Iraq. The grain storage silos at the new feed mill were supplied by Brock and have a total capacity of 75,000 tonnes at two locations.

The equipment for the feed mill was purchased from Bühler, and it initially had a production capacity of 240 tonnes per 24 hours. With the purchase of another feed mill line from Bühler in 2016, Al Hazaa doubled production capacity to 480 tonnes per 24 hours.

The company now produces two types of feed — cattle and poultry — for the Jordanian market, and it exports some of its production to Iraq.

“We are noticing a significant growth in the demand for feed here in Jordan because of overpopulation and the arrival of Syrian refugees,” Khalid Al Hazaa said. “The estimated consumption of feed in Jordan is around 1.6 million tonnes per year. In 2015, Jordan imported 700,000 tonnes of corn, 300,000 tonnes of soymeal and 400,000 tonnes of barley and produced 200,000 tonnes of bran. All these materials had been used to produce pelleted and meal form feed for cattle, poultry and fish. The largest share was for poultry, about 70%.”

Global Feed Mill sells around 50,000 tonnes of feed every year in Jordan and exports 10,000 tonnes annually to Iraq. Ninety percent of the feed the company produces is pelleted and the other 10% is in meal form.

“The greatest opportunity for growth is in producing poultry feed because of the great interest in poultry farming due to the increasing demand for poultry meat that resulted from the increased population in Jordan,” he said. “This demand is in part driven by the perfect weather for farming and the cheap prices of poultry when compared with other meat.”

Market Changes

Hazaa Investment Group
this production mixer was purchased to increase efficiency and performance. 
 
The conflict-driven shifts in population in the Middle East have caused demand to increase in certain areas and challenging conditions in other markets. Reacting to theses shifts and meeting demand is a challenge and an opportunity, Khalid Al Hazaa said.

“We have faced two recent changes in the market,” he said. “The first is closing the land borders with Iraq that has a negative impact on exporting, and the second is increasing demands in Jordan led by overpopulation that helped in covering the decline in demand due to the closure of borders with Iraq.”

The company has seen an increase in the number of competing feed producers in Jordan. This includes competition from large international companies like Cargill.

The war in Iraq and Syria has posed a challenge in that exporting to those countries is far more difficult, he said. The resolution of those conflicts, the increase in Jordan’s population and the company’s efficient modern systems for producing feed are seen as opportunities for the company.

“We believe that the strength we have in this field is that this mill is part of a complementary chain, as Al Hazaa Group owns sister companies to the feed mill, companies for grain trading, grain storing, mills, empty bag factories and a poultry farm, which helps the feed mill to grow,” Khalid Al Hazaa said.

Targeted Investment 

Hazaa Investment Group
Al Hazaa stores and loads the finished feed in a warehouse located next to the feed mill.
 
Al Hazaa Investment Group is taking steps to grow its share of the feed market in Jordan.

“In the coming 5 and 10 years we hope to become the number one company in Jordan in feed production,” Khalid Al Hazaa said. “Many steps are being made to achieve this goal. Over the last few years, Al Hazaa Group invested up to $15 million in the feed mill, and there is a current expansion for an extra $10 million. Our strategy is becoming the number one company in Jordan in terms of quantity and quality.”

In building the feed mill and adding capacity, the company focused on the need for safety, quality and energy savings.

“During our expansion, many machines and equipment from Bühler were installed to improve the factory performance, such as new mixers, the latest control system by Bühler (WinCos) that increases maintenance efficiency and the pelleting system HYSYS that offers top quality pellets, excellent sanitation and low operating costs,” he said.

The production of feed in the mill is fully automatic, he added. Raw materials are received, stored, milled and packed automatically.

“Our company is building solar energy cells in order to produce the required energy entirely from solar energy within the next two years,” Khalid Al Hazaa said.

In addition to being a customer, Al Hazaa Investment Group is Bühler’s agent in Iraq.

“Al-Hazaa Group has a strong relationship with Bühler that goes back more than 30 years,” he said.

The feed mill is located on 100,000 square meters. In addition to increasing production capacity, the company said it aims to increase storage capacity to 250,000 tonnes in the next five years.

“There is considerable room for expansion either in storage or production,” he said. “We have already made a plan for the next 10 years, which includes many expansions. Discussions with Bühler are being made to offer some proposals to set up a factory that produces premix.”
Al Hazaa Investment Group entered the Jordanian feed industry in 2008 and in 2016 doubled production capacity at the facility.
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