The company has both, production and exports of competitive products and represent leading world brands in Turkey. We conducted an exclusive interview with O. Burak Erenoglu, Chairman of the Board of UBC Chemicals, to get details of their success story.
We would like to get more information about UBC Chemicals and Bade Chemicals that operates under the brand name of UBC Chemicals. Could you furnish us with information about your product group and production capacities?
Our story began 12 years ago with the establishment of UBC Chemicals in Istanbul to represent and distribute world-famous brands in Turkey. Today, we have undertaken the representation and distribution of many companies leading in their fields such as Eastman, Jungbunzlauer, Nedmag, and F.Pache.
Our specialty lies within the food industry but we also continue to serve various sectors such as foundry, feed and leather using the stocks in our owned and contracted warehouses located in İzmir, İstanbul and Mersin where the total holding capacity is more than 1,500 tons.
In addition, in 2015, we put our stabilizer production facility with an annual capacity of 4,800 tons and then our fatty acid ester production facility with an annual capacity of 3800 tons into operation under the brand name of BADE Chemicals. By the end of this year, with the completion of the 8,000 m2 factory to be built we aim to commission our hydrogenation facility with an annual production capacity of 6,000 tons and the fatty acid ester production facility with an annual capacity of 12,000 tons.
Our current production portfolio mainly includes GMS, GMO, PGE, PGPR, SMS, STS, DATEM, LACTEM, CITREM and ACETEM.
In the upcoming period, you will be able to find functional products such as emulsifier mixtures, different oils and emulsifier oil mixtures in our portfolio. We continue to grow slowly but with firm steps forward.
What have the demands of the food industry from you been in recent years? What are your most preferred products?
For many years now, the food industry has been heavily investing in food safety, standardization, traceability and sustainability. Therefore, the demands are mainly in this direction. From the moment UBC Chemicals was founded, we have been working hard to meet these demands using our years of experience.
Today, we are proud of having BRC (AA), ISO 14001, and ISO9001 certificates, as well as Moi and Jakim approved Halal Certificate and Ortodox Union approved Kosher certificate.
Since our initial experience is within the chocolate, cake gel and oil sectors, the demands from those industries are slightly higher than in any other sectors. In this context, PGPR, PGE and STS are among our highest demand products. But the demand for LACTEM and SMS are also increasing.
As UBC Chemicals, you undertake the distributorship of important companies in the Balkan countries, South America, Europe, Far East and Russia. Are you a manufacturer or distributor as Bade Kimya?
The main objective behind the establishment of BADE Chemicals is to showcase our production capabilities and bring a Turkish brand into the world market. In that respect, BADE Chemicals will continue to be the face of our production whereas UBC Chemicals will continue to take the role of representing BADE Chemicals using its distribution network.
Could you mention about your current export markets and target markets?
We already export Bade Chemicals products to Morocco, Algeria, Tunisia, Egypt, Russia, Vietnam, Philippines, Thailand and even Sri Lanka. As you can imagine, we aim to grow even more and open up to new markets. To do so, we continue our negotiations with manufacturers and local partners in countries in MENA. For now, that is our main target market for growth.
To provide faster service and be more closely involved in local market activities, we know that it’s key to be physically present. In this sense, we aim to establish our regional offices in Europe in 2022 and in the Far East in 2023, which are our other target regions.
Your company adopts the principle of fast and efficient shipment of products by using strategic warehouses. How fast do you deliver shipments to buyers around the world?
Due to its location Turkey is close to MENA and European countries. Today, we have the power to make shipments from our regional warehouses located in Izmir, Istanbul and Mersin to any location in Turkey, at the latest within 2 days using our own vehicles. In order to serve MENA region, it’s faster and feasible to use the Mersin Port, but by road can be an option too based on our customer’s need. For Europe our customers have the flexibility to choose between road, sea or railway transportation.
Despite the expectation of 45-60 days, on average it takes around 15-20 days to export to the MENA region. What is required and crucial is to do the planning right. The orders included in our plans, could be supplied within 2 weeks without any problems. I must say, we find it highly unethical to cancel or delay shipments that are yet to be made due to the increase in product prices. These kinds of actions do not fit into trade ethics. You can rest assured all orders will be strictly supplied on the date approved by us.
During the pandemic period, there were various disruptions in the supply & production of food ingredients and problems with raw materials, even in large companies in the sector. How do you manage this term, how did the pandemic affect your production and product variety?
As for many others, the coronavirus has affected us negatively. In addition to the difficulties, we faced in the supply of raw materials, the precautions we took within the framework of the prevention of coronavirus caused disruptions in our production timeline.
Problems in raw materials due to production and transportation made it difficult to find many products and caused us to encounter increases in product prices by 300% or even 400%. Unfortunately, we do not expect this situation to improve in the short term due to the new variants. In order to overcome this situation with minimum loss and not to be affected by the sharp price increases, we started making early purchases in line with the expected demand of our regular customers. This caused a rise in stock costs but that’s a price we’re willing to pay in order not to sacrifice our service quality.
In addition, our search to find alternative suppliers gained speed. We are now working with two to three alternative suppliers for our main product range. By the end of September last year, we had already finalized our preliminary preparations for 2022. Our aim is to secure our position and to have a continuous, uninterrupted flow of raw materials from our suppliers with the contracts we have made. I can’t emphasize enough on the importance of early planning. Let’s hope 2022 does not turn out to be a more difficult year.
You aim to transfer natural resources to future generations with environmentally friendly products. What are your works in this direction? The food industry has a serious demand for environmentally friendly products, how do you evaluate this demand?
The effects of global warming, the Covid pandemic, the rapid increase in the world population and rapid depletion of our natural resources are inescapable. We also feel it close to our hearts. The decrease in raw material avaiability in response to the increasing demand in the markets, apart from the significant increase in costs, caused us to remember once again the importance of efficiency in production. For this reason, we want to keep our production efficiency above 95% level so that our already limited resources are not exhausted in vein.
It is a not at all surprising to see an increasing demand for environmentally friendly products since the awareness of our consumers also increasing. They want to know more what they are consuming, by whom it is produced and how it is made. In this sense this situation makes us happy and cause us to do more and do better.
In order to play our part we plan to build our new factory as a Green Building by the end of this year. Firstly we plan to start with the installation of 1050 solar panels on the roof to produce an average of 670,000 Kwh of electricity annually right after the construction of our factory is completed. We will also be sharing the excess electricity produced back to the ITOB Organized Industrial Zone, where we are currently located in.
In addition, to use resources more efficiently and reduce our negative impact on environment we are planning to install rain water harvesting system. This will allow us to reduce the water requirement and recharging ground water. Once we receive our Green Building certificate, we will continue our efforts to become the next carbon neutral company.
We are more than ready to do our part in order to leave a livable world to future generations, and we will continue to so with passion and dedication.
What are the goals of Bade Kimya to increase its presence in the global food industry?
In addition to our high standards, we aim to increase the diversity of our product range. With the help of our new facility, we will add functional products such as emulsifier mixtures, different types of oils and emulsifier oil mixtures. Our new facility will also increase our competitiveness since it will enable us to use local resources where we can benefit more favorable conditions.
As we discussed earlier to provide faster service and be more closely involved in local markets activities, we know that it’s the key to be physically present. In this sense, once we establish our offices in Europe and MENA regions with the support of our regional sales teams there, we aim to increase our brand reliability and awareness by meeting customer demand in the market with the best way possible.
