"Despite existing uncertainties, we expect 2023 to be another strong year, again fueled by pharmaceuticals, personal care, and food ingredients."

Paul Chan

MD, JEBSEN & JESSEN INGREDIENTS THAILAND

June 30, 2023

Could you walk us through the organizational structure of Jebsen & Jessen Group, and how JJ-Ingredients falls within it?

The Jebsen & Jessen family enterprise dates back to 1895, when two partners from Denmark, Jacob Jebsen and Heinrich Jessen, set up a trading company in Hong Kong and quickly expanded to mainland China and beyond. In 1909, the European base Jebsen & Jessen Hamburg was established and in 1963, Jebsen & Jessen started its operations in Singapore and Malaysia to better service the Southeast Asian markets, with our Thailand operations established in 1970. Nowadays, the Jebsen & Jessen family enterprise is incredibly diverse, spread out over 20 countries and employing over 5,900 people globally with an annual turnover of US$ 4.9 Billion.

The Ingredients business unit that concerns the scope of this interview is one of five business units from the Jebsen & Jessen Group in Southeast Asia, the others being Cable Technology (JJ-LAPP - a JV with Lapp Holding Asia), Life Sciences (JJ-Lurgi - a JV with Air Liquide), Packaging and Technology. While our other business units specialize in equipment, manufacturing and engineering solutions, our Ingredients business specializes in promoting and distributing specialty chemicals and life science ingredients throughout Southeast Asia and China.

Jebsen & Jessen Ingredients‘ (JJ-Ingredients) headquarters is in Singapore. Thailand, however, is one of our largest markets and an important strategic base, hosting our Customer Innovation Centers, with two food laboratories (savory and sweet) as well as a personal care lab and a coatings lab. Our innovation labs in Thailand support both customers and suppliers in developing and testing new formulations tailored to the local markets.

How is JJ-Ingredients answering to the growing focus on supply chain traceability?

Our primary focus is on delivering value to our customers, and one way we do this is by introducing digitalization and automation to operate in more efficient and innovative ways. Traceability has now become one of the main requirements from our customers in the food and pharmaceuticals industries. Working closely with our suppliers, we seek to offer end-to-end transparency across the entire value chain by continuously upgrading our systems, introducing barcode tracing, and digitalizing the transportation process.

Many specialty chemical producers go directly to the market rather than through a distributor. What are the advantages of partnering with a local distributor?

Along with a complex distribution infrastructure, Southeast Asia and China are very diverse in culture and ways of interacting with customers. As a specialty chemicals and ingredients distributor, we are connected to the entire value chain, providing value-added distribution services that enable manufacturers to focus their resources on production capacity and innovation. Acting as extended arm of our business partners we provide more efficient distribution channels by tapping into our local knowledge and expertise. Without our extensive local networks and customer intimacy, manufacturers would find it challenging to penetrate the market, highlighting the critical role our services play.

What is Jebsen & Jessen Ingredients’ outlook for 2023?

2022 was one of our strongest years in terms of performance as we maintained resilience during the height of the pandemic. Our diverse portfolio consisting of six business lines (Coatings & Resins, Plastics & Rubber, Performance Chemicals, Animal Feed, Food, and Pharmaceuticals & Personal Care) enables us to successfully navigate through various economic cycles. While the food and automotive segments faced their share of challenges during the onset of the pandemic, demand came back strongly during the later stages. Last year also saw a considerable increase in demand for the petrochemical industry, with the food and personal care sectors driving growth today, while pharmaceuticals maintain a consistent demand. Despite existing uncertainties, we expect 2023 to be another strong year, again fueled by pharmaceuticals, personal care, and food ingredients. As for the performance of the petrochemical and automotive industries, these will likely be influenced by the global economic situation and intensified competition from Chinese chemical producers.

Do you have a final message for our international audience?

That people are the most important asset could not be truer than for a distribution business which has few physical assets. Skills development has always been and will always be my primary focus going forward because this is what determines the quality of service and expertise we deliver to our customers, allowing us to stay competitive and ensuring the ongoing success of the company.

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