Suffolk malt producer embarks on a £73m expansion plan
PUBLISHED: 13:50 08 January 2019 | UPDATED: 15:00 10 January 2019
A family-owned malt manufacturer and producer is set to expand following a £73m loan from HSBC UK.
Muntons will spend the cash on expanding its facility at its headquarters in Stowmarket, and on building a new peating plant 25 miles down the road from its current facility at Bridlington in Yorkshire.
The Baker-Munton family has been trading in malt and grain since the 19th century, and established Muntona Ltd in 1921. The company is seeing increasing demand for its malted ingredients that are used in products such as breakfast cereals, confectionery and malted beverages - turnover climbed to £96.2m in the year to 30 December 2017, up from £89.3m 12 months earlier.
Andy Simpson, Muntons group finance director, explained that the new £73m loan facility with HSBC replaces the previous £53m facility the company has had with RBS since 2015. “We were looking for further funds because there are lots of opportunities for expansion,” he explained. “The new peating plant will enthuse the malt with peat to give it a smoky flavour, enabling us to sell peated malt to whisky distillers for a smoky flavoured whisky. Some of our competitors are already doing this. We will move the malt through the peating plant and distribute it from there.”
There will also be expansions in Suffolk, but Mr Simpson said it’s too early to reveal what they will be.
“We purchase more than 250,000 tonnes of barley every year from within the UK, and our new plans to increase our manufacturing capabilities mark the start of a fantastic new chapter for us,” he added.
Muntons, which encompasses both Muntons Malt and Muntons Malted Ingredients, employs over 250 staff in the UK with a further 70 staff internationally.
A fire that occured at Muntons’ Bridlington plant in November caused some disruption to the firm, and Mr Simpson explained that they have been doing everything in their power to get back on track there. “It’s all covered by insurance, and there was no long term impact - the fire brigade came out quickly, thank goodness - but it has been disruptive in the short term,” he said. “It means we have had to reverse a few processes.”
In order to prepare for Brexit, Muntons has applied for is Authorised Economic Operator (AEO) status, which Mr Simpson claims offers a number of benefits post-Brexit. “Achieving AEO status will mean a faster application process for customs simplifications and authorisations, so will be very helpful whatever happens with Brexit and should be in place before the Brexit deadline,” he said.
“We are quite lucky because most of our raw materials are from the UK - our barley is grown in the UK – and our big export market is the Middle East and the US. We are also fortunate to be near Felixstowe, which is quite efficient compared to some of the other ports.”