Family sardines maker bullish on exports

ZAMBOANGA CITY, Philippines — Sardines maker Universal Canning, Inc. is launching a P300-million fishing facility on Saturday as it beefs up exports amid a global economic slowdown. Anita Lee Kaw, president of the Universal Group of Companies, said the US downturn has yet to affect their sardines business. She noted that since the US financial crisis worsened in mid-September, their clients abroad have maintained their orders. Universal Canning has been exporting for more than three years now. "When people do not have enough money to buy decent food, the tendency is they will go for cheaper but healthier food, such as canned sardines," Ms. Kaw told BusinessWorld. Universal is one of three out of the 10 canning firms here that are into exports. This city produces more than 80% of the local canned sardine market. The sardine and fishing industries here employ more than 50,000 workers. For the local market, net profits of Universal Canning grew by half last year, at a time when Filipinos were tightening their belts due to rising consumer prices. Canned sardines are part of poor man’s diet, and it is said to be the cheapest source of protein. Ms. Kaw said 90% of the canned sardines that will be produced at their new facilities would be solely for export, about 60% to the European Union. Universal Canning, maker of four brands including its flagship Family sardines, recently acquired the Master Sardines brand. Aside from having a good grip on the domestic market, the company has established a presence in the United States and East and Southeast Asian countries, as well as in the Middle East, Ms. Kaw said. Despite being a relatively young player in the sardine industry, the Universal Group has spread its business in deep-sea fishing, ice and fish meal production, shipbuilding and docking facilities for trade and product distribution. The new fishing facilities will include a club canning line, blast freezer and cold storage, which are all located at its 30,000-square meter manufacturing plant in the Ayala district in this city. "The new facilities will achieve our company’s dream to complete the integration of our sardines business," she said. The new plant can produce 2,000 canned sardines daily, while the blast freezer and cold storage facilities can accommodate 1,000 tons and 10,000 tons of fresh sardines, respectively. Universal is one of the two canning companies here, along with Ayala Seafoods Corp., which has its own fishing fleet. The latter is behind the Mega sardines brand. Ms. Kaw said focusing on the export market is one way to help ease rising manufacturing costs. Dr. Stanley N. Swerdloff, senior fishery adviser of the US-funded Growth with Equity in Mindanao, earlier advised local canneries to explore global markets to stay afloat amid rising tin can, fuel and fish prices. — Darwin T. Wee, BusinessWorld