Muscat: Salalah Mills Co, a publicly-traded firm on the Muscat Stock Exchange (MSX), proposes to invest between RO 10 and 12 million in a new food industries hub in Khazaen Economic City.

The Dhofar-based flour mill company will sign an initial agreement to this effect for the lease of a 20,000-square-meter land in Khazaen. In the first phase, the proposed Food Industries Centre will comprise an industrial bakery and manufacturing lines for frozen and semi-cooked pastries, with frozen cakes, snacks, noodles, and biscuits following in the second phase.

In a filing to the Capital Market Authority, Salalah Mills CEO Ahmed Alawi al Dhahab said the new venture is in line with the company’s strategy to expand its flour-based food activities. The project, financed with the support of commercial loans, will come into production before the end of 2022. Internal Rate of Return (IRR) is projected at 18 percent, with the complex expected to turn a profit from the second onwards, the CEO noted, citing feasibility studies.

Salalah Mills, one of the Sultanate’s largest millers, runs four mills in Raysut Industrial City with a total capacity of 1,500 tons per day. Macaroni is also produced by a wholly-owned subsidiary at a rate of 432 tons per day. According to the business, a plastics manufacturing plant, which presently produces 250,000 bags per day, is being extended to reach a capacity of 350,000 bags per day by the end of 2022.

Additionally, Salalah Mills plans to commence trial production of its concentrated animal feed manufacturing unit by the end of this month, with a production capacity of 240 tons per day. Likewise, Salalah Laboratories Company, a new subsidiary focusing on providing physical and chemical analysis of grains and foodstuffs, will be launched this year.

Going forward, Salalah Mills has plans to diversify its product portfolio and revenue sources said Al Dhahab. Over the 2022 – 2025 timeframe, the company aims to expand into various food categories, notably food grain trading and storage, manufacture of flour blends, improvers, vitamins and minerals for bakeries, flour mills, fodder factories, starch production, fish and pet feed, production of grass capsules, and manufacture of flexible packaging films and FFS bags. Besides, the company is weighing partnerships for the production of plastic medical supplies, he added.