Fruit and vegetable processing company The Food Revolution Group (ASX: FOD) has followed up on its recent announcement that it plans to commence hand sanitiser production from its upgraded plant in Melbourne, by confirming the receipt of a $2 million first order from its distribution partner Careline Australia.
The company’s newly installed bottling line in Melbourne will produce hand sanitiser under the Sanicare brand with the current coronavirus pandemic forecast to boost sales for the foreseeable future as authorities wrestle with over 74,000 reported cases in China alone.
Careline has agreed to distribute Food Revolution’s products through its daigou network and by filling orders it receives directly from supermarkets and distribution customers.
According to Food Revolution, it will fill the order alongside other contracted manufacturers, including Careline’s manufacturing plant in Sydney, to ensure the order is filled and delivered in the shortest possible timeframe.
Food Revolution confirmed it ordered the bottles required to commence production and anticipates that its order can be filled “in the next four weeks”.
Much like other medical equipment suppliers distributing products in China, Food Revolution is keen to expedite its distribution in China for both commercial and humanitarian reasons.
Health authorities in China are actively prioritising assistance for companies selling products and services associated with combating and controlling the spread of the virus.
Currently, products that can help mitigate the spread of the coronavirus pandemic are experiencing heightened demand, especially from areas with high contagion rates such as Hubei province.
In response, Chinese authorities are fast-tracking regulatory approvals and aiding companies with logistical challenges to ensure hospitals and clinics have ample supplies.
Hand sanitiser, in particular, is in high demand due to official medical advice stating that everyone should wash their hands more regularly, especially if in contact with potential risk cases.
Food Revolution uses new facility to meet demand
Food Revolution said that growing demand caused by the coronavirus has prompted the company to investigate its capacity to produce a hygiene product from its newly installed bottling line at its Mill Park processing facility.
The company has already sourced the ingredients for an alcohol-based hand sanitiser and expects to commence production before the end of this month.
“We believe this is the first of many orders for our hand sanitiser product,” said Food Revolution chairman Norman Li.
Mr Li also explained that Careline has demand for this product from both Australian supermarkets and pharmacy chains as well as direct demand from China.
“Food Revolution’s aim is to build these distribution channels so that [it] can continue to supply them beyond the current coronavirus outbreak,” said Mr Li.
This morning’s news helped to push Food Revolution’s shares up almost 10% to $0.094 just before midday.