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07/03/2019 – News / Food Processing / Oats / Fazer / Sweetener / Health / Xylitol / Finland

Sweet innovation from oats – Fazer builds €40m xylitol factory in Finland


Family-owned group Fazer – one of the largest corporations in the Finnish food industry – has announced its intention to bring xylitol production back to Finland with development of a new xylitol-manufacturing facility in Lahti that will use the hull of oats as the raw material to create the up-and-coming sweetener.


Utilising the side-stream of the oat-milling process with state-of-the-art technology in order to produce xylitol production is a great example of a modern circular-economy innovation. The market for xylitol – a sweetener produced from xylose, which is found in various trees and plants – is expected to grow in the years ahead, and Fazer will be targeting Northern Europe and beyond with this plant-based raw material of Finnish origin. 


Indeed, the production of xylitol is a Finnish innovation, with industrial manufacturing commencing as far back as 1975. Bringing the process back to the motherland, Fazer’s upcoming plant in Lahti is expected to be the world’s first fully backward integrated xylitol production plant, once completed in 2020.


“An innovative circular-economy solution”


Fazer has said it is investing €40 million in an oat hull based xylitol manufacturing facility in Finland as it strives to penetrate the xylitol market. The investment will strengthen Fazer’s position more broadly as a forerunner in value-added, grain-based products. In Fazer’s oat-milling process, a substantial amount of oat hulls are derived as a side-stream. Oat hulls contain xylose, which can be used to produce xylitol.


“We have at hand an innovation where we combine patentable new technology, healthier options to consumers and an excellent example of an innovative circular economy solution,” said Christoph Vitzthum, President and CEO of Fazer Group. “We believe that xylitol from a plant-based Nordic raw material with a Nordic origin will create interest also outside Finland and the Nordic countries – even globally. We plan to expand the xylitol production to our mill in Sweden, too. I’m proud of this example of the fearless creativity at Fazer, and we are excited about the new opportunities ahead of us,” he enthused.


Plant-based products: A strategic growth area 


Fazer is investing in the development of new production technologies and solutions to accommodate the new venture. “Producing xylitol from oat hulls is a true innovation requiring totally new technology. The production process is unique due to the raw material, which, until now, has not been commercially utilised. Currently, oat hulls are used mainly for energy production,” the company noted in a statement.


The xylitol factory will be built next to Fazer’s oat mill on its existing Lahti site: The factory will be the first fully backward-integrated xylitol manufacturing facility in the world capable of producing many forms of xylitol – supporting the market needs of the food, cosmetics and pharmaceutical industries alike.


Xylitol – sweet prospects for an expanding market


Modern consumers are seeking healthier options to replace refined white sugar. And within that context, xylitol offers excellent potential for future product development, given its low-calorie profile – with just 60 per cent of the calories of sugar, yet just as sweet. Chewing gum and pastilles are currently the most popular products incorporating xylitol, yet the sweetener offers excellent potential for future product development, given it has an approved EFSA (European Food Safety Authority) health claim, and daily use of xylitol is globally recommended by many dental associations to reduce the risk of cavities.


The xylitol market is growing and Fazer aims to be the only xylitol manufacturer producing xylitol from a plant-based raw material with Finnish origin. Beyond that, xylitol is already an important ingredient for Fazer’s confectionery business – Fazer is presently the only company producing xylitol chewing gum in Finland.


Fazer published its first announcement about the new Lahti facility investment in January this year. Works at the site commenced in February, with investment in the facility anticipated to run through to next year. The new facility is expected to create 30 new jobs at Fazer’s Lahti plant, alongside providing additional indirect employment opportunities. 


Further expansion in Northern Europe and beyond


With sustainability on the rise as a growing trend and consumers increasingly interested in plant-based solutions, Fazer has said it is developing its business and product portfolio with a special focus on such consumer trends. “Fazer’s aim is to transform into a modern sustainable food company,” the firm said in a statement. “In line with the company strategy, Fazer is targeting further expansion in Northern Europe and beyond. The investment in Lahti supports this direction. The oat hull xylitol factory will be a part of the Fazer Lifestyle Foods business area.”


Over the past three years, Fazer has invested approximately €195 million in total, of which €136 million has been invested in Finland.


Offering bakery, confectionery, biscuit and grain products, plant-based meals, non-dairy products, on-the-go food and drinks, as well as food and café services, Fazer Group recorded net sales of €1.6 billion last year and has more than 15,000 employees.

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