Morinaga Milk Industry Co., one of Japan’s largest dairy companies, is stepping up its production in Europe of lactoferrin.

The company wants to double production of the ingredient, of which it says it is the largest manufacturer by share of the global market.

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Morinaga Milk is spending EUR15m (US$17.6m) at its facility in the southern German town of Leutkirch.

The investment will take production to 170 tons, the group said. Operations are planned to start in April.

Morinaga Milk said demand for lactoferrin has been growing due to the ingredient’s use in foods including infant formula, “particularly in Western countries and Asia”.

The company is also aiming to increase the sales of its own “lactoferrin-related products” through the investment at the German plant, which operates under the group’s Milei subsidiary.

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just-food has asked for further details on the rationale for the investment.

In the year to the end of March, Morinaga Milk’s net sales rose 1.3% to JPY590.89bn (US$5.67bn). Operating income increased 13.6% to JPY25.36bn, with Morinaga Milk’s profit attributable to owners of the parent up 33.1% at JPY18.66bn.

In the opening quarter of the company’s new financial year, sales fell but profits rose. In the three months to 30 June, net sales declined 2.5% to JPY148.88bn. Morinaga Milk saw higher sales of products including milk, yogurt and ice cream as Covid-19 drove up demand for food for in-home consumption. However, the company said B2B sales of “commercial dairy products” fell “steeply” during the quarter.

However, operating income was up 3.2% at JPY7.33bn. Morinaga Milk said its profit attributable to owners of the parent was 11.4% higher at JPY4.79bn.