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Kennedy's Bakery Production Magazine | October 14, 2019

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Fazer builds €40m xylitol factory in Lahti

Fazer builds €40m xylitol factory in Lahti

Fazer brings xylitol production back to Finland and builds a xylitol manufacturing facility in Lahti using hull as the raw material.

Utilising the side stream of the oat milling process with state-of-the-art technology for xylitol production is a great example of a modern circular economy innovation. The xylitol market is expected to grow, and Fazer targets Northern Europe and beyond with this plant-based raw material of Finnish origin.

Fazer continues to develop its business and is investing €40m, in an oat hull based xylitol manufacturing facility in Finland to enter the xylitol market. The investment will strengthen Fazer’s position as a forerunner in value added grain-based products. In Fazer’s oat milling process, a substantial amount of oat hulls are derived as a side stream. Oat hulls contain xylose which can be used to produce xylitol.

Christoph Vitzthum, President and CEO, Fazer Group, says, “We have at hand an innovation where we combine patentable new technology, healthier options to consumers and an excellent example of an innovative circular economy solution. We believe that xylitol from a plant-based Nordic raw material with a Nordic origin will create interest also outside Finland and the Nordic countries, even globally. We plan to expand the xylitol production to our mill in Sweden, too. I’m proud of this example of the fearless creativity at Fazer, and we are excited about the new opportunities ahead of us."

Fazer is investing in the development of new production technologies and solutions. Producing xylitol from oat hulls is an innovation which uses new technology and the production process is unique due to the raw material which, until now, has not been commercially utilised. Currently, oat hulls are used mainly for energy production.

The xylitol factory will be built next to Fazer’s oat mill on the Lahti site: The factory will be the first fully backward integrated xylitol manufacturing facility in the world capable of producing many forms of xylitol, supporting the market needs of the food, cosmetics and pharmaceutical industries.

Modern consumers are seeking healthier options to replace refined white sugar. Xylitol offers excellent potential for future product development and the market is growing.

Fazer aims to be the only xylitol manufacturer producing xylitol from a plant-based raw material with Finnish origin. Furthermore, xylitol is an important ingredient for Fazer’s confectionery business - Fazer is the only company producing chewing gum in Finland.

The major investment will take place in 2019-2020. It will create 30 new jobs at Fazer in Lahti and also indirectly employ people; works at the Fazer site in Lahti started in February 2019.

Fazer targets further expansion in Northern Europe and beyond

Sustainability is a constantly growing trend and consumers are increasingly interested in plant-based solutions. Fazer is developing its business and product portfolio with special focus on growth and consumer trend, its aim is to transform into a modern sustainable food company. In line with the company strategy, Fazer is targeting further expansion in Northern Europe and beyond. The investment in Lahti supports this direction and the oat hull xylitol factory will be a part of the Fazer Lifestyle Foods business area.

In the past three years, Fazer has invested approximately 195 million euros in total, of which, 136 million euros have been invested in Finland.