“We rely on our expertise in flour milling to produce better quality noodles, our noodles are healthy, delicious, halal and free of chemicals and preservatives that comply with the highest food safety standards and quality requirements. The factory is fully supplied by Bühler’s high-tech machines and latest production lines. Because this business is promising and seems to be expanding in the future, our next goal is to continuously increase the capacity of our noodles production, expand our markets and distribute our Noodi brand in more countries around the world."
Al-Hazaa Investment Group
Al Hazaa, Jordan's first and only noodle producer, increased its capacity to meet the high demand it faced. We talked to Al-Hazaa Investment Group Operations Manager Walid Al-Hazaa, who has increased the noodle production of 25 thousand glasses per hour in Jordan by 5 times to 120,000 glasses with the new production line they have established.
Dear Mr. Walid Al-Hazaa, could you please inform us about the activities of Al Hazaa Investment Group?
Al-Hazaa Investment Group is an active member in the food production industry since 1942, we are driven by the motive of consciously feeding the nations, enhancing food security, and protecting our environment, therefore we operate flour milling and pasta & noodles production factories in addition to our business activities in other complementary sectors like feed milling, grain storage & trading, plastics industry and energy engineering, in which the Group operates its own solar power generating plant to supply its facilities with clean energy. Al-Hazaa Group with its 80 years of experience operates several facilities in four countries in the Middle East in Iraq, Jordan, Egypt and UAE, it has a team of more than 2,900 employees, with a grain storage capacity of 800,000 tons and grain milling capacity of 5,500 tons per day.
Our goal is to innovate new products and expand our business activities without disturbing the world’s balance, and to follow up with the world’s best innovative technologies and new trends. We always seek to find better and easier ways in operating our facilities to produce highest quality yet efficient and safe products, that will satisfy the needs of our customers.
You make investments that complement each other in fields such as grain milling, pasta production, feed production, plastics, and energy sectors. You have investments to increase capacity and also new production lines in the existing facilities. Can you tell us about these investments?
As I mentioned above our goal is to invest in projects that are innovative as well as sustainable, we strive to keep up with the world’s top-notch technologies and modernization. Our strategy when it comes to expanding our existing production lines is by seeing a possible need or a chance for the expansion this means that we take our decision in advance, before the demand happens, we improve the production lines by upgrading machinery or by increasing its capacities. Thanks to our wise management that envisions the upcoming situation, and the role of our president and chairman, Mr. Jamal Al-Hazaa, who takes the appropriate decisions at the right time, and this strategic planning has helped us in always being one step ahead of the market, this can be seen by the quick growth of Al-Hazaa Group, as it accomplished many large projects in the region in a short period of time and this what distinguishes us from others.
The role of the quality of our products and countries that we work in also plays an important role, since we produce high quality products that satisfy the needs of our customers and also because we operate in countries where the population growth rate is relatively high, we have always seen an increasing demand for our products and this facilitated the importance of expansions of our production lines.
You are the only company producing noodles in Jordan. You have increased your noodle production, which used to be 25 thousand cups per hour, by 5 times and reached 120 thousand cups per hour. Can you give us information about this investment?
Yes, we are the first and only noodles producers in Jordan and we succeeded in a very short time to compete with big brand names in the region thanks to the high quality of our product and now we are expanding our production because we faced an increased demand, so we launched the cup noodles to provide more convenient product for our customers who prefer quick meals. We are the only noodles factory in Jordan to produce bagged and cup noodles, but we still have a big share of our production for export markets as well, we export our products to 25 international markets in 5 continents around the world in Asia, Africa, Europe, North America (Canada, and the US), and Australia. Our company is producing 750 packs of noodles every minute which equals to more than 1 million packs a day, and as mentioned above, sold in 25 different markets.
Our factory is located in an industrial area close to the airport of Amman, it is a very strategic area because it is close to all FMCG distributors, which helps us in distributing our noodles to the entire Jordanian market, also our location is near the airport highway road that leads directly to Aqaba, the only port in Jordan and this also facilitates our export procedures.
What differentiates us and helps us in achieving this high demand and sales is the great quality of the raw materials we use, the best technologies implied at our factories, the high-tech Bühler machines and also the distinguished taste that matches the consumers’ needs. The main raw material for the noodles is wheat flour, which is supplied to us by our flour mills in Jordan, we receive the wheat flour according to special specifications that suit our recipe to produce our end products in the factory, and this gives us a competitive strength as we control the quality of our main ingredient and have special specifications that will ensure the production of good products.
Your investments in the noodle market draw attention. How do you see the future of this market? What are your next goals?
In my opinion, anything related to the instant food market is booming in the upcoming years, the world is moving towards time saving, fast prepared food, and a great example of this would be the instant, ready to eat food such as instant noodles, instant soups, pre-cooked cereals, ready mixes, etc. This direction in food consumption was driven by the changing behavior of workers and their working time, in most countries, the minimum working hours are 8 hours a day and can be more in some countries and this caused pressure on the time spent on food preparation and this motivated the use of packed instant foods over traditional freshly cooked foods. And instant noodles became a desirable product due to their easy and quick preparation while it is considered at the same time cheap, filling, and delicious and this applies to all instant food whether instant pasta, instant rice, oats & porridge. And of course, the growing population worldwide has a strong role in increasing the pressure on all food products, as the current world population is 7.9 billion of people, who need food every day.
So, because this business is promising and seems to be expanding in the future, our next goal is to continuously increase the capacity of our noodles production, expand our markets and distribute our Noodi brand in more countries around the world and improve our product in terms of new flavors, new servings or shapes, and maybe to introduce a new product of instant food.
Your production site and markets are located in the same geography. So the markets you are addressing are almost the same. What advantages and disadvantages does this give you on top of product development?
Not actually because we are located in Jordan yet we sell our products to more than 25 countries around the world in 5 continents, so we are selling our product almost all over the world and we are planning to further expand our export markets and to really cover all markets possible across the globe. Operating a business nowadays, in my opinion, doesn’t depend on geography anymore, you can see a lot of products in your local market from different countries, consumers sometimes favor imported products over the local ones and vice versa. Some consumers prefer to always try different and new products, others prefer to stick to brands they know and products they have already tried, so it’s a matter of preference and everyone has their own taste so you will always find customers for your product not only in your local market but through exportation as well. Branding also makes a big difference, you can see how people prefer big names over not very well-known brands, nice packaging and colors also catches consumers attention, and this gives the potential for imported goods to compete in any market.
In fact, operating in Jordan offered us a huge advantage as the country offers a suitable environment for investments, as it has a high growth rate, the Jordanian population is steadily increasing year after year, which results in a continuous increase in demand for food products to feed the market. Jordan also signed many trade agreements with Europe, the US, some Far East countries like Singapore and African countries like Kenya which helps us to export our products to these countries easily. Jordan is also part of the GAFTA (Greater Arab Free Trade Area) which is an agreement to facilitate and develop trade among Arab countries, which enables us as well to export our products to Arab countries without paying any customs duties. The disadvantage of exporting however is the high shipping cost, it was an increasing concern for all food manufacturers after the spike in prices due to the Covid pandemic.
How do producing and exporting in the geography where pasta is the cheapest affect your quality?
This is a very interesting question and you are completely right, markets become very competitive when the price of a certain product is cheap. However, our business strategy doesn’t fully rely on the price, in those markets, we of course face some difficulties but we focus on marketing the quality of our product, our know-how in milling and food production, the best technologies we invest to produce our products and focus on the way we present them to the market, because the price is not the sole indicator for the consumers when they choose a product, they want to know more about your product, they want to see the clean label behind your production. So even if you cannot compete on the price by offering a cheaper product, you compete on the quality and on the brand name to achieve good sales, but of course every market has its own strategy. We rely on our expertise in flour milling to produce better quality noodles, our noodles are healthy, delicious, halal and free of chemicals and preservatives that comply with the highest food safety standards and quality requirements. The factory is fully supplied by Bühler’s high-tech machines and latest production lines.
You are a company focused on Arab markets. How does the recent increase in popularity of these markets motivate you?
No, we are not only focusing on the Arab markets, as I told you before we at Halloumi Foods Company are selling our products across the world and this also implies for other facilities owned by Al-Hazaa Investment Group, we never focus on one territory but we seek opportunities in any possible market, and thanks to the high quality of our products we have always found customers that appreciate our products and look for them. Maybe the interest in investments and sales in the Arabian markets comes from their strategic location, and continuously increasing demand due to their high and increasing population, also a large share of this population is children and youth whom their needs of food products like flour, pasta, noodles, etc. is increasing by time.
What does your R&D team do about pasta production?
Our R&D team including myself are always focusing on introducing new flavors and keeping up with market changes. We do product tasting every weekend in different areas around the country in hypermarkets and major KPIs and at the tasting stands we distribute feedback questionnaires to ask customers about their satisfaction level, and about any improvement suggestions, or new flavors they would like to try, then our R&D would study the questionnaire and would take necessary actions.
We invest a lot in research and development but we believe that our team are doing a vital role and we are so satisfied with their work and are seeing good results from it, especially from the tasting stands and questionnaires, it is indeed very important to listen to your customers, and hear if they are satisfied from your product or not, if they would like to see something new, and so on.
Governments' move to increase their stocks caused records in wheat prices. How do these high wheat prices affect you?
Of course, governments around the world and also wheat mills started increasing their wheat stock because they were badly affected by the sudden increase of prices, the increased cost of transportation and many other factors that were caused by the covid pandemic or at least occurred at the same time like increase in energy and fertilizers costs, bad harvesting season, etc. For us the increase in wheat prices caused increased prices for our main raw material which is flour, the increase in flour prices was a real challenge for us because we couldn’t find any alternative way to absorb this increase, as a result we had to raise our noodles selling price as well, but we tried to keep the influence low on consumer and despite this challenge of increased production costs, the noodles remained an affordable option compared to other food products.
The whole world is suffering from expensive energy. You, on the other hand, can make a more protected production against these costs with the solar power plant established within the structure of Al-Hazaa Investment Group. What are the advantages of this?
The solar power plant was built after directions from our Chairman, Mr. Jamal himself because Al-Hazaa Group operates several flour mills and factories in Jordan so this step was taken in implementation of Al-Hazaa Group’s vision in being more sustainable and achieving conscientious business growth, therefore Al-Hazaa Group decided in 2017 to invest in the renewable energy sector to operate a power plant in Jordan that supplies all, and our facilities in the country with green energy, to reduce our carbon emissions. By this important step the Group achieves one of its business values of being more productive yet efficient and environmentally conscious, as Al-Hazaa Group is committed to building and sustaining its community and has various ongoing initiatives that contribute to the welfare of our people and society. Since its establishment, the solar power plant has indeed helped us a lot, it did an undeniable role in reducing our production cost. And after the recent increase in energy and other sudden costs during the pandemic, the role of the power plant was very much needed.
We depend 100% on the solar plant for all our electricity needs to produce our products, which add a competitive strength to us. Another advantage of using clean energy for production facilities is the fixed energy cost you pay, whereas if you depend on fossil fuel energy that is supplied by the government, your cost will always be fluctuating and you can’t determine the cost nor can you reduce it. On the other hand, the price that we pay to Al-Hazaa Company for Renewable Energy is fixed for a long time.
The world has been going through a very challenging and extraordinary period over the past two years due to the pandemic. How has this challenging period affected Al-Hazaa Group? Have your investments been affected by the pandemic?
Of course, like all other manufacturers, we were affected by the Covid pandemic and our operations were badly influenced because of the lockdown and other difficulties caused by this pandemic, all production lines at Halloumi foods are supplied by Buhler China and the installation of our cup noodles line was delayed due to the pandemic as it caused delays in delivery and difficulties for the visiting experts from China and Switzerland, the situation wasn’t ideally financially either, as we all witnessed the price increase and disruptions in supply chains. But we’d rather look at this unfortunate situation from a positive side and see what it taught us
No one can deny how difficult the last two years have been and how much Covid has affected all of us in all aspects, it disturbed our business activities, threatened the health and safety of nations and caused instability in the world’s economy, however, we had to quickly adapt to this new situation to make sure we produce enough food supplies for our people in Jordan and in the region, it was challenging but we saw it as our duty. It gave us very good experience in dealing with hard situations very quickly and trained us maybe in a very difficult way, yet successful, to form flexible strategies. Also, the pandemic helped us in exporting our products to new countries we wouldn’t reach in normal circumstances, because due to the shortage in food supplies in some countries, traders got encouraged to import from neighboring and also far countries to cover this shortage despite the increases in shipping prices, and we were successful in entering many new markets and now we have agents and distributors for our brand in those countries.
You are a constantly growing investment group. Can you share with us your investment plans for the upcoming period?
I would answer this question by imagining that our Investment Group is like a human body that has no choice but to grow over time and gain more experience and knowledge, we as a result always search for good new opportunities in our field to invest in and to grow our business, we do have a lot of projects under the microscope that we are studying very well with our team before bringing it to life, we wait for the right time to take the opportunity to jump in and start working on new projects. However, our main focus in the upcoming years would be, as I mentioned above, the instant food market which will face, in my opinion, a huge demand for the upcoming five years.
Furthermore, we are very interested in investing in digitalization and automation systems, they proved how important they are during the pandemic and how they can support us humans in times of crisis and lockdown, this includes investments in cyber security, online sales, online events, etc.
Is there anything else you want to add?
I would like to thank you very much for your questions, and thank everyone in this field for their great efforts, we are going through extraordinary times but we will surely manage and overcome it with our mutual support.