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Broadway Bakery


Rice in Nigeria SEPT/OCT. 2017 NO. 26












To be at the top of your game in the changing food and agro industry in Africa, you need the right ideas and technologies to execute your plans. Join your industry peers at AFMASS 2018 editions in Kenya and Zambia where you will: • Source hundreds of Processing, Packaging, Food Safety and more industry solutions from leading local and international suppliers • Network with over 3,000 industry and Govt. opinion shapers and leaders • Learn the latest technologies and trends in cost savings, efficiency, food safety and sustainability






My Company, My Story: Nairobi Bottlers Ltd (Coca-Cola

Broadway Bakery

Beverages Africa)

Thika, Kenya-based bakery commissions new plant to meet new customer demand with consumer health in mind

Company Focus: Zambeef Products

Industry Report: Dairy Industry in Kenya



Rice Milling Industry in Nigeria

Special Report:

A review of the rice production and processing industry in Africa’s largest rice market, Nigeria

Reach your audience in Africa’s industry. Take advantage of advertising opportunities in this issue

Craft Beer in Africa

Adverts deadline: November 5, 2017 2



Introducing Africa’s only industry directory, made by industry veterans Africa’s industry is growing, and so are the number of options for sourcing critical industry supplies - be they ingredients, chemicals, equipment, laboratory & safety solutions, packaging, industry services, engineering solutions and more . . . Finally, there is a solution. Available in a digital format from November 2017, the Industry Directory Africa is your all-in-one resource to find local, regional and international suppliers to the food, agro, pharma, milling, animal feed and related industries in Africa. Contact us to sign up your company today FoodWorld Media Ltd: +254 725 34 39 32:

CONTENTS Volume 4 Issue 5, No.26 • ISSN 2307-3535



Plastics packaging ban needs more time for reflection


Calender of events - A run down on the key industry events in Africa and the World

NEWS IGC ups world grains harvest to second largest on record


Unga closes loss-making Ugandan mill, to open new mill in Western Kenya


Cargill establishes joint ventures with UK poultry producer


Coca-Cola Nigeria to spend US$600m on new products by 2020


Kellogg appoints Steven Cahillane as CEO, as John Bryant retires


Indian wine, Chinese spirits offer significant opportunities to 2021



Stevia hits sweet spot (almost) as a sugar alternative


Sharad Gupta, Senior Vice-President of Olam Grains


GEA acquires Italian pasta equipment maker Pavan Group


Bunge to acquire 70% of specialty oils major IOI Loders Croklaan


Diversey back as stand-alone company after private equity fund buys it from Sealed Air COVER PHOTO: BROADWAY BAKERY CEO BIMAL SHAH





FoodWorld Media P.O Box 1874-00621, Village Market, Nairobi Kenya Tel: +254 20 8155022, Cell: +254 725 343932

SEP/OCT 2017 | FOOD BUSINESS AFRICA SUBSCRIPTION Email: Food Business Africa (ISSN 2307-3535) is published 6 times a year by FoodWorld Media Ltd. The magazine is distributed for free to food, beverage, milling and foodservice companies and Government regulatory agencies in Africa. The magazine is available through subscription for the other stakeholders in the food chain, including suppliers to the sector. Postage is paid at Nairobi, Kenya. Send address changes to FoodWorld Media Ltd by phone or email. Copyright 2017. Reproduction of the whole or any part of the contents without written permission from the editor is prohibited. All information is published in good faith. While care is taken to prevent inaccuracies, the publishers accept no liability for any errors or omissions or for the consequences of any action taken on the basis of information published. FOODBUSINESSAFRICA.COM




The African Food & Beverage Tech Conference is the go-to educational platform to discover the latest post-harvest, processing, packaging and food safety technologies and regulatory matters in the dairy, beverages, horticulture, processed food and food service with a focus on Africa’s industry. But there is more in store for you, with an expo where you also get to meet leading regional and international suppliers so you can implement your ideas immediately. SIgn up today!!





Plastics packaging ban needs more time for reflection and industry engagement


he recent ban on plastics packaging by the authorities in Kenya continues to elicit mixed reactions from many stakeholders in the country. In one way, the ban propels Kenya to the hallowed group of the very few countries that have gone the whole hog and banned plastic packaging outright for the sake of the environment, while on the other hand, it has placed the food and agro industry in the country at a cross roads.

be regulated. But, it has to be said that replacing plastic packaging is difficult to replace entirely due to its features: flexibility, strength, lightness, stability, moisture and chemical resistance, as well as suitability for recycling and reuse. It would be foolhardy to imagine that finding a material to replace some of these attributes will be done in Kenya in the next month, year or even ten years with the new regulations in place. And it has to be said that if alternatives were

The food and beverage industry has been at the forefront of seeking solutions to packaging challenges. We feel the new regulations need a multi-disciplinary approach, incorporating food safety and trade impact While industry stakeholders appreciate the fact that plastic packaging has placed a lot of strain on the country’s environment, and were quite fine with the original ban on shopping bags and similar products, the planned extended ban to include plastic packaging used in the packaging of food and beverages at the industrial level has the industry staring at operational gridlocks and loses running into millions of dollars if the regulator, the National Environmental Management Authority (NEMA), sticks to its plan to ban plastic used in the packaging of bread, dairy products, water and other essential products that are consumed by millions of Kenyans daily. The worry is that while NEMA keeps on advising the industry to seek out ‘alternative packaging’ options, it has failed to provide guidance or even provide a solution to the industry, which has been left to continue searching for alternatives in a market where these solutions basically do not exist. We believe that if this extended list of plastic packaging is ever implemented, it will change the face of the whole industry, with particular effect on small and medium scale manufacturers who have no capacity to invest large sums of money in meeting most of the new requirements. The search for alternative packaging solutions to replace plastics has been a key talking point for decades, probably as old as plastics themselves, for no one denies the fact that plastics last too long in the environment and their use should 6


already available to entirely replace plastic from the packaging of food and beverage products, some enterprising entrepreneurs could already have taken the initiative and invested in the technology and made some millions! It is also important to remember the huge role that plastic packaging has played in enabling the reduction of food waste in Kenya and Africa as a whole, in a continent where it is said up to 40% of food produced goes to waste because of lack of handling and storage mechanisms. The food and beverage industry has been at the forefront of seeking solutions to packaging challenges around the World. Coca-Cola in 2009 debuted the Plant Bottle packaging that is used in a number of countries for some of its brands. With 30% plant materials derived from sugar cane processing waste, the bottles are fully recyclable, convenient, and lightweight while reducing the environmental impact of the bottle. Many food companies including Nestle, among many others, have ambitious targets to reduce the environmental impact of their packaging, ‘lightweighting’ their packages through well laid out strategies that have saved millions of carbon that could have been released into the atmosphere. Unilever recently opened a plastic packaging recycling testing plant in Indonesia and is seeking partners to help it scale up to recycle it’s sachet packaging. Maybe the regulators should tap into these initiatives and borrow some of the strategies and technologies, which they can

share with the broader industry. Harmonised regulations We think that it would be prudent for NEMA and other regulators in Africa to engage with the sector in laying out strategies to reduce the usage of these materials, replace with alternatives where possible and recycle the waste from the usage of plastics. This will require the enforcement of regulations around waste disposal from homes and factories and the adoption of best practice from around the World to manage plastic waste. African countries, however, still face challenges with public waste collection and disposal services that will hamper the achievement of this goal. Those who give the example of Rwanda, often quoted as an example of a country that has managed to ban plastics for regular use, often forget that the enforcement of laws and regulations and the capacity of public institutions in Rwanda is way better than many countries in Africa. We do feel that it is critical for these new regulations to have a multi-disciplinary approach in their implementation, with the Kenya Bureau of Standards (and the broader Ministry of Industrialization) and Ministry of Health (which regulates food safety) sitting together with NEMA to not only seek ways to minimize the impact of plastics packaging on the environment, but also on the broader food safety and trade implications on the country’s food and beverage industry. We believe that regulations of the industry, including ensuring that packaging meets performance and food safety standards, action by the industry players to minimize packaging of their products and a well-managed waste collection and recycling program are some of the key issues that should be acted upon to bring sanity to the industry and the environment in general. We wish you a good read Francis Juma






Welcome to Africa’s only technical and commercial conference dedicated to the latest technologies in post-harvest, processing, packaging and food safety; and commodity markets for the region’s grains, milling, baking and animal feed industry. Sign up to today for educational sessions, field visits while meeting and networking with industry leaders, Goverment regulators and suppliers.



14.5M Wheat harvests in the UK this season



The rate of obesity in the US, followed by Mexico and New Zealand



Months that Chicago’s sugar tax on sweetened beverages was in place, before being abolished



Number of professionals recruited by Pepsi to drive the company’s e-commerce strategy


US$2.3B Revenues lost to illegal fishing by West African countries per year


300, 000 Number of people diagnosed with Type 2 diabetes every year


US$1.2B Ivory Coast and Ghana’s planned loan from AfDB to boost cocoa storage and processing facilities


US$600M Amount lost by Nigeria every year on forex used to import sugar



Meat exports from Brazil, following a food safety scandal this year, lower than expected


US$1.2B Exports value of citrus fruits from Argentina in 2016


US$1.23 Amount cocoa farmers will receive per kg this season



Amount Flour Mills of Nigeria intends to raise through a rights issue



The share held in International Breweries by AB InBev after merging company’s operations in Nigeria


11% Ratio of fortified sugar that met standards in a study by a US university


4 MILLION Number of birds culled in the country due to bird flu this year







Litres of milk planned to be produced at the World’s first floating farm in the country

130.7M Metric tonnes of grain that Russia expected to harvest this year, a national record


50% Percentage of EU honey imports sourced from China





China’s maize production in 2017/18 season, down 2% from last year

New harmonized GST rate being considered for the general restaurant businesses in the country




Growth rate per year of packaged cooking oil as consumers seek convenient packs


Amount promised by investors into India’s food industry in next few years




Inflation rate in the country in October 2017, expected to slide to 21% by year-end


Growth rate of Africa’s economies in 2017, slowing down from earlier forecast of 2.6%



Value of devaluation of the Ethiopian currency by the Govt to encourage exports



Number of Ugandans, or 30% of population who eat ‘unacceptable food’, says UNBS


DRC 32Million MALAWI


Projected maize harvest in Kenya, forcing the country to import from April 2018

Tonnes of maize produced by Malawi in the last planting season



Amount paid to farmers in Zimbabwe for this season’s maize deliveries by State grains agency




M Million



Revenue that Fonterra’s Food Service business reported for its full year 2017




December 5-7, 2017

March 20-23, 2018

Gulfood Manufacturing Location: Dubai World Trade Centre, Dubai, UAE Contact: Dubai World Trade Centre Tel: +96 824 3987 60 Email: Website:

Agrofood West Africa Location: Agrofood West Africa Contact: AHK Ghanacessing Industries Tel: +233 302 631 681-3 Email: Website:

Anuga FoodTec Location: Cologne, Germany Contact: Koelnmesse GmBH Tel: +49 1806 578 866 Website:

November 1-3 China FoodTech Location: China International Exhibition Centre, Beijing, China Contact: CIEC Exhibition Company Ltd Tel: +86 10 8460 0308 Email: Website:

April 25-27, 2018 February 2-6, 2018 Europain Location: Parc des Expositions, Paris, France Tel: +33 04 78 176 351 Website:

November 2-4

February 7-9, 2018

American Feed Industry Association’s Equipment Manufacturers Conference Location: Orlando, Florida, USA Contact: American Feed Industry Association Tel: +1 703 524 0810 Email: Website:

Fruit Logistica Location: Berlin, Germany Contact: Messe Berlin Website:

November 3-5 World Food India Location:Vigyan Bhawan, New Delhi, India Contact: Ministry of Food Processing IndustriesCenter Tel: +91 11 45771000 Email: Website:

November 13-15, 2017 ICC Whole Grain Summit Location:Vienna, Austria Contact: ICC – International Association of Cereal Science & Technology Tel: +43 1707 720 40 Email: Website:

November 15-17, 2017 African Dairy Conference & Exhibition Location: Johannesburg, South Africa Contact: East & Southern African Dairy Association (ESADA) Tel: +254 721 266 481 Email: Website:



February 14-16, 2018 African Fine Coffee Conference & Expo Location: Kampala, Uganda Contact: African Fine Coffees Association (AFCA) Tel: + 256 414 269140/1/7 Email:

African Food Manufacturing & Safety Summit (AFMASS) Conference & Expo – Kenya edition Location: Visa Oshwal Centre, Nairobi, Kenya Contact: FoodWorld Media Ltd Tel: +254 725 34 39 32 Email: Website:

October 3-5, 2018 African Food Manufacturing & Safety Summit Conference & Exhibition (AFMASS) – Zambia edition Location: Lusaka, Zambia Contact: FoodWorld Media Tel: +254 725 34 39 32 Email:

For event listings, contact us at for considerartion. Terms and conditions apply

AFMASS CONFERENCE & EXHIBITION GOES TO ZAMBIA!! The fast growing industry-focused trade show Africa Manufacturing & Safety Summit (AFMASS) Conference & Exhibition is expanding in 2018 with a new edition in Lusaka, Zambia. The event, planned for October 3-5, 2017 in Lusaka, Zambia is the first processing, packaging and food safety focused event of its type in the Southern-Central Africa region, and will bring together industry leaders, Government regulators, NGOs and suppliers to the industry to discuss the future of the food and agro industry in the region - while providing a platform to identify technologies required by the industry to do value addition, store and trade food and agro produce. AFMASS Zambia edition will bring together the stakeholders from Zambia, Zimbabwe, Malawi, Botswana, Mozambique, Angola, DRC, Tanzania and other African countries into Lusaka for three days of technical conferences, exhibitions and field vists to leading companies to share the future of the industry in the region. More information can be found at FOODBUSINESSAFRICA.COM


IGC ups world grains harvest to second largest on record

WORLD – The International Grains Council (IGC) has increased its estimates

for world grains harvest to the second largest ever on record, citing improved forecasts on wheat and maize production figures. The Council has raised the production of wheat and coarse grains, including barley, maize and sorghum by 20 million tonnes to 2,069 million tonnes for the 2017-18 period, above the 2014 figures to the second highest harvest ever. This figure compares to the record output of 2,133 million tonnes produced in the 2015/16 season. According to the report maize production will increase by 12 million tonnes higher than before, because of adjustments for Argentina and the USA. Revised figures for Russia will increase global wheat harvests by 5 million tonnes and barley by 1 million. “A larger projection for feed outweighs cuts for food and industrial uses and boosts the forecast for total consumption by 7 million tonnes, to 2,096m, up a fraction year-on-year to a new peak,” says the report. World soybean production outlook has been lifted to 348 million tonnes, 3 million below the previous season’s peak. “Since



TOTAL CEREALS PRODUCTION FORECAST FOR 2017/18 SEASON the consumption projection is maintained at an all-time high, global ending stocks are predicted slightly higher at 42 million tonnes. This would still represent a yearto-year drop of 6% amid expectations for a contraction in key exporters, namely Brazil and Argentina.” World rice trade will rise in 2017 to a new peak of 42.8m, up by 9% year-on-year, due to bigger than anticipated shipments to Asia and Africa. Owing to modest downgrades for some Asian producers, the projection of 2017/18 global output is trimmed by 2 million tonnes, to 483 million tonnes, the second largest outturn on record.

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China delays enforcement of new food import control rules after US, EU pressure CHINA – China has announced it has delayed enforcing new controls it had planned to put in place on food imports at the start of October 2017, following complaints made by the United States, Europe and other trading partners, granting a transitional period of 2 years. “According to the complaints and application received, we hereby decide to provide a transitional period of 2 years,” said the document submitted to the WTO by the Administration for Quality Supervision, Inspection and Quarantine (AQSIQ) of China. China gave no details about the delay,

but that it might help avert concerns regarding the shipment of meat, fruit, dairy and other products, which might be disrupted. The import laws had brought tensions with the United States and Europe. Several countries had urged China

to follow the global practices and apply it only to high-risk food. A coalition that involved United States, European Union, Japan, Australia and Argentina also lobbied Beijing to scale back the requirements as stated, taking the move to be Beijing’s ploy trying to restrict imports in violation of its market-opening promises. The inspection rules follow an avalanche of scandals over Chinese suppliers caught selling tainted milk and other shoddy or counterfeit food. The new rules come into force in October 2019.


Astral sells feed business to Cargill, to focus on poultry operations SOUTH AFRICA – Southern African integrated poultry producer Astral Foods has sold off its stake in animal nutrition business Provimi to US food and agriculture company Cargill for an undisclosed amount. The poultry group, which previously owned 25% of the Provimi-branded Cargill Premix & Nutrition as part of a joint venture with the US company, announced it had entered into a five-year premix supply

agreement, with Cargill supporting Astral technically, reports BD Live. Astral’s poultry operations contribute 54.2% towards group revenue, while the nutrition business including other poultry operations from the rest of Africa contributed 3.1%, according to Bloomberg data. The group’s animal feed business contributed about 30%.


Unilever sets ambitious goal to adopt electric vehicles by 2030 UK – Anglo-Dutch group Unilever has set “By reducing our vehicle carbon emissions, we’re itself an ambitious goal of achieving 100% electric vehicles coverage of its entire fleet contributing to a healthier, cleaner and more by 2030. sustainable environment. We are drawing up plans to In an industry first, the company has joined the Climate Group’s EV 100 global instal charging points at our buildings.”Lee Warner initiative that aims to bring together forward-looking companies to accelerate the transition to electric vehicles by 2030. The initiative encourages global business commitments on electric transport, where members use electric, hybrid or fuel cell vehicles to replace petrol and diesel fleets. “By reducing our vehicle carbon emissions, we’re contributing to a healthier, cleaner and more sustainable environment. Technology in this field is advancing rapidly with ever-increasing mileage ranges and into the future, fully electric self-driving vehicles”, explains the Global Fleet Services Manager, Lee Warner. As part of EV100, Unilever has committed to a phased integration of electric vehicles into the fleets that it 12


directly controls – owning directly or through leases. It aims to have these fleets to be 25% EV/hybrid by 2020, 50% by 2025 and 100% by 2030. “We have a fleet of approximately 13,300 company cars. For the immediate future, our aim is to ensure that hybrid vehicles – those that combine traditional fuel and electric power – as well as fully electric cars, are made available to Unilever company car drivers. This will happen globally as contracts with suppliers come up for renewal,” says the global giant. “In addition, we will choose to partner with car hire and taxi companies who offer or use electric vehicles. We are also looking to negotiate discounts with car leasing companies for employees who want

to lease electric cars for personal use. And we are currently drawing up plans to install charging points at Unilever buildings.” According to Unilever, transitioning to electric transport makes environmental and business sense. “The pledge supports our Sustainable Living Plan targets to reduce the environmental impact of our business by half. It will also help us save money – in terms of fuel costs versus cheaper electricity spend, as well as tax benefits – and futureproof our operations.” The company has an ambition to become carbon positive in its operations around the World by 2030, with 100% of its energy coming from renewable sources, among other initiatives and goals. FOODBUSINESSAFRICA.COM


Unga closes loss-making Ugandan mill, to open new mill in Western Kenya UGANDA – Unga Group has ceased operations in Uganda where it made losses three years in a row, with the miller saying it is reviewing its business model in that market. Meanwhile, the region’s only listed milling company is set to open an expanded wheat mill in Eldoret in Western Kenya, where plant a new 300 tonnes per day will replace the 250 MT per day plant by the end of 2017, to solidify the miller’s position. “A new wheat mill project is on course for commissioning in Eldoret towards the end of the current financial year. These investments will solidify the group’s market position,” the company said in a statement. “This is a state-of-the-art machine that will be more economical to run and efficient on production, it is going to cut down on our expenses,” said Unga Holdings’ CEO, Nick Hutchinson. In Uganda, the miller has decided to close the mill, which used to process bakers

and home baking wheat flour, blaming “a challenging business environment leading to an operating loss for the third consecutive year. Bad debt provisions and local currency depreciation against the US dollar significantly worsened its performance,” the miller said din a statement. “The board has reached a decision to cease milling operations while it evaluates available

business re-modelling options going forward.” Further, the milling group has reached an agreement with the minority shareholders to purchase the entire 48 per cent noncontrolling interest in Ennsvalley Bakery Limited, which makes the premium bakery brand a fully owned unit of the group.

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New CEO at Mondelez International as CEO Irene Rosenfeld retires

USA - Mondelēz International has announced the appointment of the current President and CEO of McCain Foods, Dirk Van de Put, to succeed Irene Rosenfeld as CEO of the company, as she steps down effective November 2017. Van de Put will also join the Board

of Directors of the global confectionery and food powerhouse, as Rosenfeld retires after leading the company for five years of transition, following the splitting of the former Kraft Foods Inc. into Mondelēz International and Kraft Foods Group, a grocery company focused on North America. Kraft Foods Group merged with Heinz to form Kraft-Heinz in 2015. Rosenfeld, who has been with the company since 2007, managing the original Kraft Foods Inc. is credited with the acquisition of Cadbury’s in 2009, a deal which has enabled the company to expand its reach into a number of developing countries including India and South Africa. She will continue as Chairman of the Board before retiring on March 31, 2018, and Van de Put assumes the role of

Chairman and CEO of the company. She says that the new CEO has a proven track record of driving top-line and category growth, while at the same time improving cost structures and profitability that should bode well for the company, going forward. Van de Put has nearly 30 years of experience in the food and consumer package industry. He joins the company from McCain Foods, the largest marketer and manufacturer of frozen French fries, potato specialties and appetizers with sales in more than 160 countries. He also has extensive experience at Novartis, Danone, Coca-Cola Company and Mars, Inc. and is fluent in five languages: English, Dutch, French, Spanish and Portuguese.


Cargill establishes joint ventures with UK poultry producer “The venture will facilitate greater opportunities to innovate and deliver new and exciting poultry products for consumers.” Andy Dawkins UK – Cargill and Faccenda Foods, a UK based poultry processor, have agreed to establish a joint venture to create a leading food company focused on chicken, turkey and duck in the country. In the deal, Cargill’s fresh chicken in the United Kingdom will join Faccenda’s fresh chicken, turkey and duck business to form the new company as a stand-alone business. Andy Dawkins, Managing Director for Faccenda Foods, will be appointed chief executive officer of the newly formed

company while Chris Hall, fresh chicken director for Cargill Meats Europe, will be appointed chief commercial officer. “We believe the two organizations are complementary. Combining into one entity allows us to build on our strengths, grow in the market and better serve our customers. The venture will facilitate greater opportunities to innovate and deliver new and exciting poultry products for consumers,” explained Chris Langholz, President of Cargill Poultry. According to the companies, the merged business will have the capability

to respond to changing customer needs in the retail and food service sectors, with a strategy for growth while focusing on operational excellence and customer focused partnerships. Cargill said it would continue its processes and sell cooked poultry products in the country as well as operate its poultry import, trading and distribution business. It would also operate its European poultry businesses in France, Russia and the Netherlands, while Faccenda will retain its shareholding in Dartmouth Foods.


USDA gives green light to China’s poultry inspection and food safety systems USA – The US Department of Agriculture (USDA)’s Food Safety and Inspection Service (FSIS) has released the final audit report showing China’s inspection system for poultry processing is equivalent to U.S. systems and standards. USDA released the clean audit report one month after the comment period closed on a proposed rule that will allow China to not only process and package cooked chicken, but to export the chickens, ducks 14


and turkeys it raises. An onsite review in, covering a number of Government agencies involved in food safety and standards and at a number of poultry farms and processors in China, was conducted in mid-July, 2016. The new rule opens USA’s US$30 billion American poultry market to China, the world’s second largest poultry producer, despite concerns with China’s food safety systems, following a number of high profile food safety incidents.

The approval of chicken imports from China follows the recent opening up by the authorities in Beijing to allow beef from U.S. producers to re-enter China’s market, following a nearly 15 year’s ban since the country banned US beef products in 2003 after Bovine Spongiform Encephalopathy (mad cow disease) outbreak in a number of countries.





Insect meal producer AgriProtein wins BBC’s food and farming award “Insect protein is an idea whose time has come and we are now producing it at an industrial scale.” Jason Drew

SOUTH AFRICA – AgriProtein, the South-African based fly farming and wasteto-nutrient up-cycler, has been named the BBC Food Chain Global Champion The company was awarded for its flagship product, which helps in securing the future of food while delivering significant environmental benefits. The Food Chain Global Champion award, BBC’s first-ever international food and farming award, recognizes outstanding work that challenges established methods and practices to secure the future. The company’s MagMeal brand, an animal feed ingredient made from fly

larvae reared on food waste, offers a natural alternative to the world’s fish stocks, which are under threat, due to the use of fishmeal to feed rising demand of fish by humans. “Insect protein is an idea whose time has come and we are now producing it at an industrial scale. This award is a vote of confidence in the waste-to-nutrient industry”, said AgriProtein co-founder and CEO, Jason Drew, at the announcement of the award winner. “Trawling for fishmeal is one of the most destructive activities on the planet. Replacing it in animal feed is good news for the environment and means more of the world’s dwindling population of wild fish can be harvested sustainably for human consumption. By using existing waste to rear fly larvae, we’re reducing the greenhouse gases and pollution caused by organic landfill,” he explained. “The culture of food, the science, technology, politics and business associated with food are key concerns to our worldwide audience. Our Global Champion Award

highlights both the challenges and fascinating successes being created by individuals around the world”, said BBC World Service Sr. Commissioning Editor, Steve Titherington. The use of insect protein has caught on of late, with a number of investments and new product innovations experienced in the last one year, as changing consumer perceptions boost the utilization of these products in animal feed and human food products around the World. Regulators are also taking note of the vast potential of insect proteins. New EU regulations permit use of insect-based nutrients in aqua feed since July 2017, while other geographies already permit its wider use inWITH agriculture ADVERTISE USand pet food. AgriProtein has projects under development to produce MagMeal for the US$100 billion aqua feed market and ultimately for poultry, pigs and pet food.



Coca-Cola Nigeria to spend US$600m on new products by 2020

NIGERIA – Coca-Cola Nigeria Limited has said it plans to invest US$600 million by 2020 to boost sales, as part of the parent company’s global strategy to offer more 16


consumer likeable products that goes beyond its carbonated soft drinks. The Nigerian subsidiary of the Atlantabased soft drinks maker said it wants to expand its product offerings to include flavoured and condensed milk, ice tea and bottled water to meet demand, Peter Njonjo, the President of Coca-Cola West Africa told Bloomberg in an interview. “Our objective is to provide whatever beverages you need across your life stages,” he said. The US$600m is part of an ambitious programme by the Atlanta-based Coke to invest US$17 billion in Africa by 2020. Coca-Cola new Chief Executive officer, James Quincey has said the company needs to grow beyond its biggest brand and has called for the soda giant to become a “total beverage company,” with less reliance on its flagship carbonated soft drinks. In 2016, Coca-Cola acquired a 40%

stake in Nigeria’s leading juice and dairy firm, Chi Limited for US$240m with a plan to acquire the rest of the company within three years, if certain targets are met. Coca-Cola, like other manufacturers in the country have felt the slowdown in the Nigerian economy caused by low oil price, the country’s main foreign exchange earner, and dollar shortages. However, for the first time in five consecutive quarters, the economy appears to be rebounding and grew by 0.6% in the three months through June. Prior to that, the economy was beset by inflation, which climbed to as high as 18.7% in January. Njonjo said that Coca-Cola Nigeria currently employs 3,600 direct employees in the country, and operates 11 bottling plants and 30 distribution depots. The company is targeting 75% local sourcing of raw materials by 2020 as against the current 70%. FOODBUSINESSAFRICA.COM


Alcohol producers worry over new tougher alcohol regulations ZIMBABWE – Zimbabwe’s major alcohol manufacturers – Delta Corporation and African Distillers (AFDIS) – could see their business affected if the proposed regulations on the sale of alcohol become reality, reports Standard Business. A Cabinet committee has recently revived the 2010 National Alcohol Policy draft, which seeks to outlaw the sale of alcoholic products during certain days and hours of the week and never to pregnant women. New licensing proposals, including high annual fees, and regulations on how manufacturers and distributors would get the product to the retailers have since been introduced in the new policy draft. Alex Makamure, the Delta Corp. Secretary/Corporate Affairs Director, said the beverage maker participated in the consultation process and gave input into the draft policy where some concerns were raised. “Obviously, there are some provisions that were advanced by the regulators that may negatively impact on liquor retail operations and consumption patterns,” he said. “The contentious issue relates to curtailing hours on Sundays. There are already disputes with the board on how manufacturers and distributors get the product to the retailers.” In Zimbabwe, the alcohol beverages are governed by the Liquor Act, Traditional Beer Act, Road Traffic Act, Shop Licences Act, Finance Act, The Child Protection Act, and the Food and Food Standards (Alcoholic Beverages) Regulations 2001 (Statutory Instrument 25 of 2001). The new proposals seek to harmonise the liquor industry under one Act. AFDIS Managing Director Cecil Gombera said they agreed with the general sentiment from other manufacturers and distributors who saw the proposed regulations as a potential risk to revenue. “For a long time, the market has developed certain trading and consumption patterns, which include Sunday trading. These would remain areas of debate and we are certain a workable and acceptable position would emerge,” he said. In the new policy some of the proposals include stopping breweries from distributing bulk beer and instead selling bottled beer and that shops, supermarkets and bottle stores “should only be allowed to sell alcoholic beverages between the hours of 7am and 6pm and not after 12 noon on Sundays.” According to the Health and Child Care Permanent Secretary Gerald Gwinji the objective is to reduce socio-economic and other costs of alcohol abuse by setting essential national norms and standards in the retail sale and micro manufacture of liquor. It will also make players in the industry to be socially responsible for their business activities.




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4 Good Reasons to be at AFMASS 2018 in Kenya & Zambia Reason #1

FROM FOOD TO FEED INDUSTRY AND MORE . . . The Africa Food Manufacturing & Safety Summit (AFMASS) Conferences & Exhibitions are the only regional events that bring together the food, beverages, milling, baking, foodservice and animal feed industry from Africa and beyond. With one exhibition floor and two conference streams, AFMASS Conferences and Exhibitions give a 360 degree view of the industry in Africa, like no other. Further, a new edition of AFMASS in Zambia from 2018 will open up the Southern-Central region of Africa. Sign up today on the website to sponsor, exhibit, visit and attend the conferences today. FOOD BUSINESS AFRICA | SEPT/OCT 2017



AfDB debuts platform to build Africa’s food and cuisine value chain

IVORY COAST – The African Development Bank (AfDB) has partnered with a number of organisations with a goal to boost the contribution of the food and culinary sector in Africa, thereby creating jobs and improving the economies across the Continent The Bank, through an online initiative, is advocating closer linkages between development partners and policy-makers to enhance Africa’s largely informal sector’s contribution to building the continent’s food and cuisine value chain.

“We have looked at the culinary potential of African food in the creation of jobs and helping us to deal with the challenge of youth unemployment,” said Basil Jones, Gender Programme and Policy Coordinator at the Bank. “This investment in growing Africa’s culinary culture could become our trademark to stimulate the tourism sector. It would also go towards strengthening Africa’s emerging cultural identity in the international scene,” he added. The goal of the platform is to enhance the viability of food entrepreneurs, especially women and youth, seeking to start and grow a food-related business through knowledge sharing; mentorship services. It will also offer skills development and access to finance by linking the platform to crowdfunding schemes targeting agribusinesses. “The Food Cuisine initiative is the unique combination of an on-the-ground business capacity support and network building program combined with a one-stop-shop digital platform. It connects, informs and



VALUE OF AFRICA’S CULINARY INDUSTRY, ACCORDING TO AFDB enables Africa’s fast-growing community of agri-food professionals,” said Marnix Van Holland, Program Development Manager, Hivos International, one of the partners. The Bank estimates that Africa’s culinary industry is currently valued at US$313 billion, while the food and beverage market is projected to reach US$1 trillion by 2030. The Bank aims to empower the African food community, support young entrepreneurs, connect food innovators and provide a platform to showcase new products from the continent.





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Enter your company into the 2018 edition of the Food Business Africa Industry Excellence Awards and have the chance of your company being declared the winner in your sector and the ultimate Food and Beverage Industry Manufacturer of the Year.

Entries open January 5, 2018 for the following categories:


Dairy Manufacturer of the Year

Meat, Poultry & Fish Processor of the Year

Milling Manufacturer of the Year

Beverages Manufacturer of the Year

Bakery Manufacturer of the Year

Sugar & Confectionery Manufacturer of the Year

Chilled & Fresh Processor of the Year

Processed Foods Manufacturer of the Year

Animal Feeds Manufacturer of the Year

Retailer/Supermarket of the Year




FDA approves peanut allergy health claim

4 Good Reasons to be at AFMASS 2018 in Kenya & Zambia Reason #2

USA – The Food and Drug Administration (FDA) has approved a qualified health claim for peanut, supporting continuing evidence that early introduction of the nut to infants can eliminate peanut allergy later in life. The claim states, “For most infants with severe eczema and/or egg allergy who are already eating solid foods, introducing foods containing ground peanuts between 4 and 10 months of age and continuing consumption may reduce the risk of developing peanut allergy by 5 years of age. F.D.A. has determined, however, that the evidence supporting this claim is limited to one study.” According to the Commissioner of the F.D.A., Scott Gotltlieb, the claim does not cover whole peanuts, which are detrimental for young children and should not be consumed. “As the incidence of peanut allergy grew, along with an awareness of the consequences, doctors began advising patients not to introduce peanut-containing foods to children under the age of 3 who were at high risk for peanut allergy,” Dr. Gottlieb said. “While this advice was wellintended, new evidence-based guidelines recommend that the medical community consider a different approach.” National Institute of Allergy and Infectious Diseases said the early introduction of peanut-containing foods to infants may also prevent the development of peanut allergy. According to the FDA, epidemiological evidence suggests that peanut allergy prevalence in US children has at least doubled from 1997 to 2008, where peanut allergy is the cause of death-related to food-induced anaphylaxis in the United States. The qualified health claim is based on the study involving more than 600 children between 4-11 months who were enrolled in a Learning Early About Allergy (LEAP) study. All infants were considered a high risk for developing peanut allergy because they had severe eczema and/or egg allergy. The study found that regular peanut consumption achieved an 86% reduction in peanut allergy at age 5 among those who had negative skin prick tests to peanut at the study’s entry and a 70% reduction in peanut allergy among those who had positive tests.



MEETING PLACE FOR AFRICA’S INDUSTRY LEADERS Hundreds of industry experts, Government regulators, technology suppliers and other industry stakeholders from Africa and the World come together every year at AFMASS Conferences & Expos where they network, trade and learn the latest technologies and trends in Africa’s industry. Delegates at AFMASS events gain industry insights, meet new and old industry acquintances and interact with industry leaders from the region for their personal and business growth. Sign up today on the website to participate at the next conferences and exhibitions today. FOOD BUSINESS AFRICA | SEPT/OCT 2017



Coca-Cola completes transition of AB InBev’s 54.5% equity stake

AFRICA - Coca-Cola has announced the completion of the acquisition of AB InBev’s majority interest in the Coca-Cola Beverages Africa (CCBA), which was 54.5% equity stake, making the company the controlling swhareholder of CCBA. CCBA was established in 2016 through the combination of African non-alcoholic

ready-to-drink bottling interests of the former SABMiller PLC. It is the largest Coca-Cola bottler in Africa. AB InBev later acquired SABMiller and reached an agreement to transition its equity stake in CCBA to Coca-Cola. The deal includes CCBA’s operations in South Africa, Kenya, Namibia, Uganda,

Tanzania, Mozambique, Ghana, Ethiopia, Mayotte and Comoros Islands. The two companies are in discussions to have AB InBev’s interest in bottling operations in Zambia, Zimbabwe, Botswana, Swaziland, Lesotho, El Salvador and Honduras to be transferred to Coca-Cola in the near term. The announcement comes after agreements reached with the South African Government including commitments to drive CCBA’s operations from South Africa and that the company will remain incorporated and tax-resident in South Africa; and the completion of a number of regulatory approvals across the territories in which CCBA operates. With its headquarters remaining in South Africa, the Coca-Cola Company plans to hold its controlling interest in CCBA temporarily until it gets refranchised. It will account for CCBA as a discontinued operation. Several suitors including Coca-Cola Hellenic AG based in Turkey and the Coca-Cola European partners are expected to vie to take over Coca-Cola’s interest in CCBA.




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Your team has weathered the storms and delivered an outstanding new factory. Or you have finished an expansion project at your old factory in the past 2 years. Enlist your new project in the Food Business Africa Industry Excellence Awards 2018 and stand a chance to be have it celebrated infront of your industry peers.

Entries open January 5, 2018 for the following categories: Dairy Industry Project of the Year

Milling Industry Project of the Year

Bakery Industry Project of the Year

Beverage Industry Project of the Year

Chilled & Fresh Industry Project of the Year

Sugar & Confectionery Industry Project of the Year

Meat, Poultry & Fish Industry Project of

Processed Foods Industry Project of the Year

the Year

Animal Feed Industry Project of the Year


Kellogg appoints Steven Cahillane as CEO, as John Bryant retires

4 Good Reasons to be at AFMASS 2018 in Kenya & Zambia Reason #3

ALL-IN-ONE INDUSTRY SOLUTIONS’ MARKET PLACE USA – Breakfast cereals giant Kellogg Company has appointed a new Chief Executive Officer, Steven A. Cahillane, a veteran of the packaged foods business in a number of high profile jobs over the years. Cahillane, who will be replacing the current CEO John Bryant who is retiring after 20 years with the company, recently served as the President and CEO of Nature’s Bounty, the manufacturer of health and wellness products. He is credited with successfully aligning the company with key health and wellness trends, establishing a thriving e-commerce division and created significant shareholder value; key areas where Kellogg, dominant in the breakfast cereals space in the US and other developed economies, is struggling on as consumer needs shift towards health and wellness and online grocery retailers like Amazon seek to change the way food products are sold.

“Steve clearly has had a distingushed career leading successful CPG businesses throughout the World, including his work recasting Nature’s Bounty as a health and wellness company.” Donald knauss Cahillane was the President of Coca-Cola Americas before working with Natures Bounty. He also had previous roles at the beverage giant, including President and CEO of the Coca-Cola Refreshments business, President of Coca-Cola Enterprises in North America and President of Coca-Cola Enterprises in Europe. “Steve clearly has had a distinguished career leading successful CPG businesses throughout the world, including his terrific work recasting Nature’s Bounty as a consumer-facing health and wellness company,” said Donald Knauss, Lead Director, Kellogg Company Board of Directors. “With his breadth of experience, he truly understands the global marketplace in which we are operating as well as the consumer and retailer trends that will serve as potent sources of growth for Kellogg going forward.” FOODBUSINESSAFRICA.COM

Leading regional and international suppliers of equipment, chemicals, ingredients, food safety & laboratory systems, packaging, industry services and more converge at AFMASS Conferences & Exhibitions each year to showcase the right technologies to take Africa’s industry forward. AFMASS events provide solutions to both the big and small-scale industry players, better than any other event. Looking for supplies for your next project? Seeking partners or distribution opportunities with international or regional brands? Visit the website today to sign up to attend the conferences and exhibitions today. FOOD BUSINESS AFRICA | SEPT/OCT 2017



EU sugar quotas end, heralding new landscape for trade EU – Sugar quotas imposed by the European Commission on its sugar producers since the advent of the Common Agriculture Policy (CAP) in 1968 have been discontinued, opening a new chapter in World sugar production and trade. The quota system, which allocated each sugar producing member of the EU a specific quota, and also offered a support price for farmers above World market prices has been stopped after a number of years of sugar industry reform and adjustments, aligning EU sugar prices near market prices, in the process reducing the block’s sugar production by 6 million tonnes a year. Post-quota, the EU estimates that between 2016 and 2026 sugar production will increase by 6% in the block, while that of isoglucose (high glucose corn syrup, HFCS, used mainly in beverages) production could triple from 700,000 tonnes to 2.3 million tonnes, following the opening of export restrictions on EU sourced sugar and the relaxation of EU production of HFCS, that has been restricted by the World Trade Organisation (WTO).

For the upcoming season 2017/18, an increase in production of 20% is expected due to increase in area planted and higher yields The Commission projects that sugar imports into the EU will continue to drop from 3.0-3.5 million to 1.8 million tonnes, and exports are expected to increase from 1.3 million tonnes to 2.5 million tonnes per annum “For the upcoming season (2017/18), no longer bound by the limitations of the quota, an increase in production of roughly 20% (20.1 million tonnes) is expected. This increase results from both an increase in area and higher yields because of good climatic conditions,” it says in a report. The increase of production is likely to be compensated by a further decrease of imports, an increase in exports, which are expected to double to 2.8 million tonnes, and a possible rebuild of stocks which have been at the lowest level ever in summer 2017, it says.

As the quota system fades, EU sugar prices (€501 per tonne in July 2017) are expected to fall towards the €311 per tonne world market prices in the future. “Without regulatory limits on sugar production, sugar producers will optimise the use of their production capacity and reduce the unit costs of producing sugar. This will allow competitive suppliers to sell sugar on the world market, which will not be limited anymore when the quotas expire,” the report says. Least developed countries and countries that have signed Economic Partnership Agreements (EPAs) with the EU, will continue to receive quota-free, dutyfree exports of sugar to the EU under the Everything-but-Arms agreement. Concessions will also continue to be given to a number of countries in Latin America and South Africa. SPONSORSHIP OPPORTUNITIES AVAILABLE



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No two companies are the same. Some are known for their safety credentials, others for their excellent marketing prowess. Yet others place priority in their employees’ skills development. Whatever your key strength, the Food Business Africa Industry Excellence Awards provide the perfect platform for you to stamp your authority on the industry at large in the region.

Entries open January 5, 2018 for the following categories: Most Outstanding Package Company of the Year

Human Resources Initiative Company of the Year

Most Innovative Company of the Year

Sustainability Company of the Year

Quality, Safety, Health & Environment (QSHE) Company of the Year

Operational Excellence Company of the Year

Supply Chain Initiative of the Year 22


Marketing Campaign Company of the Year FOODBUSINESSAFRICA.COM


Food companies commit to simplify date labels to reduce food waste USA - The Consumer Goods Forum (CGF) – a network of 400 of the biggest consumer goods companies across 70 countries - has approved a call to action to standardize food date labels worldwide by 2020 to reduce food waste. The CGF Board of Directors including companies like Tesco, Kellogg, Walmart, Campbell Soup, Bimbo, Pick n Pay, Nestlé, Carrefour and Unilever – have unanimously adopted the Call to Action to simplify date labels, by adopting a uniform labeling system that streamlines the use of “Sell by,” “Use by,” “Display until,” “Best before,” dates that currently confuse consumers, resulting in the loss of US$29 billion, in the US alone. Call to Action recommends companies to partner with NGOs and Govt. agencies to educate consumers about how to interpret date labels, through in-store displays, web materials and public service announcements. It urges retailers and food producers to take three important steps to simplify date labels and reduce food waste by 2020 by providing a choice of two labels: one expiration date for perishable items (e.g. “Use by”) and one food quality indicator for non-perishable items (e.g., “Best if used by”), with the exact wording tailored to regional context. Further, consumer education to better understand what date labels mean must be implemented across the value chain. The announcement also expands national efforts to streamline date labels in the United States, United Kingdom and Japan to the rest of the world.

“All the evidence from WRAP and our own Tesco research has shown that streamlining date codes helps customers waste less food and it also reduces waste in our own operations. That’s why it’s so important we extend this practice to more companies in every country. Streamlining date labels worldwide by 2020 could be

“Simplifying food date labels is an important step forward in preventing food waste, and will end the confusion related to ‘sell by’ dates,” Maria Fernanda Mejia game-changing in the fight against global food waste,” said Dave Lewis, Group Chief Executive of Tesco. “Simplifying food date labels is an important step forward in preventing food waste, and will help end the confusion related to ‘sell by’ dates. Kellogg is an enthusiastic supporter of improved and harmonized food labeling standards to help educate and empower consumers to prevent food waste, save their families money, and conserve resources to protect our planet,” said Maria Fernanda Mejia, Sr. Vice President of the Kellogg Company and President of Kellogg Latin America. “Walmart has worked with its suppliers to support the use of standardized date labels that provide consistent and transparent information to better reflect



BILLIONS OF TONNES OF FOOD WASTED EVERY YEAR AROUND THE WORLD product’s shelf life,” said Katherine Neebe, Director for Sustainability at Walmart. “I commend CGF for leveraging their influence to support customer-friendly labeling practices.” An estimated 1.3 billion tons of food worldwide is lost or wasted each year, contributing 8% to carbon emissions. Standardizing food date labels is a simple and effective way to reduce the amount of edible food thrown out by households, saving them money and reducing their environmental footprint. “Now more than ever is the time for business to play a leading role in tackling food waste. This is an issue that can only truly be tackled by collaboration across the value chain. Through our global membership, the CGF is committed to playing a leadership role. We believe simplified and consistent date labelling will help us get one step closer to meeting our resolution to halve food waste by 2025 while also helping reduce confusion for consumers,” said Peter Freedman, Managing Director of The Consumer Goods Forum.

5 GOOD REASONS TO ADVERTISE IN THE FOOD BUSINESS AFRICA MAGAZINE • The only technical food & beverage industry magazine in sub-Saharan Africa • Provides well researched industry information and analysis written by professionals in the sector • Read by key decision makers with direct responsibility for purchasing of equipment, ingredients, chemicals, packaging and other services • Focused solely on the food and beverage, milling and feed sector in Africa, like no other magazine • Available in both print and as an e-reader that is available online, a first in the region If you have been struggling to get your products or services noticed in this sector in the region, your worry has come to an end. FOODBUSINESSAFRICA.COM




CBH Group takes former mining executive Jimmy Wilson for CEO role “Jim’s strenghts in extracting efficiencies, driving

excellence and using innovations and technology to escalate productivity make him a natural fit for CBH Group.” Jimmy Wilson

AUSTRALIA - CBH Group, Australia’s biggest grains company, has appointed former mining executive Jimmy Wilson as its new CEO. Mr Wilson left mining giant BHP Billiton, where he had achieved big productivity gains while expanding the iron ore business, in early 2016, after chief executive Andrew Mackenzie put in place a flatter management structure that

saw coal boss Mike Henry appointed to run Australian mining, according to the Australian newspaper. “I have worked across many different countries, commodities and markets over my career and the shift into grain, while outside the traditional mining and resources sector, has many operational and trading synergies with the industries I have enjoyed working in,” said South Africanborn Wilson. CBH chairman Wally Newman said the Board wanted a new chief that would drive the next phase of development for its growers’ supply chain in the “fiercely competitive environment of international grain trading” and foster the culture

required to support this. “With the co-operative’s current major focus on delivering our $750 million Network Strategy, Jimmy’s proven strengths in extracting efficiencies from integrated operations, driving excellence in capital management, and using innovation and technology to escalate changes in productivity, make him a natural fit for the organisation,” Mr. Newman said. Mr Wilson formally took over the role of Chief Executive Officer at the start of CBH’s financial year on 1 October 2017. Former CEO Dr. Crane will remain with the co-operative to provide support during the transition phase until 30 November 2017


Dairy exports set for growth – Rabobank NETHERLANDS - Global dairy markets remain well balanced, and as a result global prices have exhibited a period of relative stability in Q3 of 2017, but higher farmgate milk prices have been the major catalyst for a supply-side response, and the export engine is again producing more milk, according the latest RaboResearch Dairy Quarterly report. “Global dairy markets remained buoyant into Q3 2017, be it with an ongoing theme of a record price spread between dairy fat and protein,” according to Michael Harvey, RaboResearch Senior Analyst – Dairy. “The outlook for commodity markets is for a balanced market to continue. Milk production across the export regions is revving up, and the pace will accelerate in the coming months, largely led by the imminent Oceania spring flush.” However, sustained buying from China should prevent the market from being overwhelmed in the closing months of 2017. In the regional markets, in the EU milk production growth rate is at its healthiest since 2016, despite ongoing issues in some key regions. Butter prices continue to shine in the block and milk prices will continue 24





to improve says the report. In the US, the industry will continue the more than 40 months of consecutive milk supply growth, while in New Zealand, extremely wet weather across most parts of the country has set challenging conditions for the start of the 2017/18 season but milk production for the 2017/18 season is still expected to be strong on the back of improved conditions. In China, demand for imported milk

has picked up strongly as anticipated, and this trend is expected to continue into 2018, albeit at a lower rate, coupled with weaker local production. In South America, a more solid rebound in milk production is underway across the region, but dairy consumption will be hit by strong economic headwinds. In Q3 2017, Australia’s milk production will have returned to growth, following seven quarters of consecutive declines. The 2017/18 season is forecast to deliver 2.5% growth, supported by improving farm profitability and favourable seasonal conditions.



Indian wine, Chinese spirits offer significant opportunities to 2021 With rising purchasing power and increasing wine culture in the country, India offers magnificent growth opportunities for wine manufactureres, says the report. 2016 to 2.3% by 2021, a small fraction of the regional volumes. “Growing urbanisation, changing lifestyles, and rising popularity of wine, particularly among the upper middleclass urban consumers, is driving the sector. With rising purchasing power, and increasing wine culture in the country, India offers magnificent growth opportunities for wine manufacturers,” says Kiran Kumar Akkineni, Consumer Analyst for GlobalData In terms of categories, still wine captured majority of the Indian wine market in 2016 with volume share of 52%, with expectation to continue to dominate in the future. Fortified wine was the second largest category, accounting for 43.6% volume share, while sparkling wine held a

IN NUMBERS ASIA - Rising purchasing power and the increasing impact of westernisation are set to boost the Indian wine sector in the years to come, according to a recent report by GlobalData, a research firm. In its latest report titled ‘Country Profile: Wine Sector in India’, GlobalData states that the sector which was valued at INR61.06 billion (US$908.6 million) in 2016 is expected to grow at an impressive value Compound Annual Growth Rate (CAGR) of 19.9% during 2016–2021. In another report, the rise of a drinking culture at Chinese social gatherings and increased disposable income among younger consumers, are set to drive the Chinese spirits market through a CAGR of 15% from 2016-21. Despite a high CAGR of 23.2% (in volume terms) during 2011-2016, India’s wine sector is still at a very nascent stage but is growing rapidly; accounting for only 0.2% share of the global wine sector in 2016. The country’s volume share of the market in the Asia-Pacific (APAC) region is expected to almost double from 1.2% in FOODBUSINESSAFRICA.COM

16.9 B

AMOUNT OF SPIRITS TO BE CONSUMED IN CHINA IN 2021, DOUBLE 2016 FIGURES share of 4.4%. “Still wine will continue to lead the market, growing at a CAGR of 20.4% during 2016–2021, followed by fortified wine and sparkling wine which are likely to grow at CAGRs of 19.4% and 18.7%, respectively, during the forecast period,” adds Akkineni. In terms of market structure, the Indian wine market is relatively consolidated with the top five wine brands holding 44.9% volume share in 2016. The three top market players – Indage Vintners, Sula Vineyards and John Distilleries - are all Indian companies. The Chinese spirits market is expected to more than double, reaching over US$450 billion by 2021 from US$205 billion in 2016. The Chinese spirits market, which held 32.8% of the global volume share and

52.3% of the Asia-Pacific regional volume share is projected to reach 46.9% and 66.2% respectively by 2021. The amount of spirits consumed in the country is expected to double from 8.4 billion liters in 2016 to 16.9 billion liters in 2021, growing at a CAGR of 15%. China’s younger consumer base that drink on social occasions and the country’s increasing number of female drinkers will play a major role in the years to come for the Chinese spirits market, with per capita spirits consumption in the country set to rise to 14.4 liters by 2021 from 7.3 liters in 2016, according to the report. “The country’s GDP has grown at a rate of around 7–8% in the last few years, which has increased disposable income, especially in more cosmopolitan urban areas. With more dispensable income, these Chinese consumers love to spend on social occasions, especially on drink,” said GlobalData analyst Ryan Whittaker. Chinese drinkers have a special liking for specialty spirits, which are mostly locally produced and China-specific spirits, accounting for 94.2% and 98.2% in terms of value and volume respectively in 2016. The category, worth US$193.3 billion in 2016, is set to grow further at 15.1% per year, dominating the overall spirits market to 2021. Whiskey, vodka, gin and genever, tequila and mezcal, liqueurs and rum respectively follow brandy, the second favorite, with a 3.9% value share and a 0.9% volume share. Tequila and mezcal demonstrates the most notable signs of potential growth ahead, according to the report, witnessing the fastest growth at 21.6% over 2016–2021. In 2016, 60% of spirits consumers were male in China, with consumption high among consumers with tertiary education, who accounted for 75.6% of the total. Spirits consumption is mostly concentrated in urban China with a significant share of 97.5%, while hypermarkets and supermarkets are the leading channel for spirits distribution in 2016, with a 54.4% share of volumes, as most consumers are mostly from urban areas.











Stevia hits sweet spot (almost) as a sugar alternative


ver the past decade, a little-known herb 200 times sweeter than sugar has become a US$4 billion global industry, showing up in everything from Coca-Cola to Heinz tomato sauce. Not a bad start for a product that many people still think has a bitter aftertaste. The stevia plant, which can be processed into a zero-calorie sweetener, has taken off as a sugar alternative. Consumption tripled from 2011 to 2016, according to Euromonitor International. While it’s still a small part of sweetener sales, companies such as Cargill and ED&F Man Holdings are investing more money in it — including to improve the taste. “This is a market that has huge growth potential,” says Jonathan Hugh, head of the agri-industrial division at London-based commodity trader ED&F Man, which has a stake in the stevia-based Unavoo Sweetener. “We see a lot of investment opportunities.” Finding a low-calorie sugar substitute that doesn’t alter the taste of iconic brands has been a longtime quest in the food industry, especially with a global obesity epidemic and rising diabetes rates. Over the years, that has led to artificial sweeteners such as aspartame, sucralose and xylitol. But many consumers report unpleasant side effects from those products or worry about ingesting chemical additives.



Stevia, which is often marketed as a natural sweetener because it is derived from plant extracts, has almost no calories and a glycaemic index of zero, which means it can be consumed by diabetics. Named after a Spanish botanist, stevia is a member of the sunflower family of plants and has been grown in South America for hundreds of years. It didn’t get much attention until 2008, when Minneapolisbased Cargill, one of the world’s largest agricultural companies, introduced its stevia-based Truvia sweetener in the US. Demand accelerated after that, including in 2011, when the EU approved stevia use in food. It’s now found in salad dressings, chewing gum and even face wipes for babies. The plants, which thrive in sunny, warm conditions, are now grown in countries such as Paraguay, Kenya, China, the US, Vietnam, India, Argentina and Colombia. More than 10,000 stevia-containing food and drink products have been added in the past five years, with more than 70% being introduced in the past three years, says Pure Circle, a stevia maker that is based in Malaysia. In the UK, new products with stevia almost tripled in the four years to 2016, according to Mintel, a London-based researcher. It’s mostly used in soft drinks, but increasingly found in sauces, tomato

sauce, snack bars, popcorn and toothpaste, says David Jago, Mintel’s director of innovation and insight. Nestle, the world’s biggest food company, is using stevia in fruit juice in Brazil, coffee mixes in South Korea and in its Nestea brand iced tea. Lindt & Spruengli, the biggest maker of premium chocolates, says its Russell Stover unit will introduce stevia-sweetened chocolate in the US later in 2017. CocaCola and Pepsi are adding it to diet beverages. To be sure, sugar remains the king of the sweeteners with about 83% of the total market, says agricultural consultant LMC International. And stevia still faces some difficulty with consumers, partly because it has a bitter aftertaste in many forms, they say. While demand continues to grow, the gains have slowed drastically since 2012, rising 2.1% in 2016, to 1,038 tonnes, according to Euromonitor data. “Taste has been an issue, meaning manufacturers have had to combine it with sugars to try and mask off-notes,” says John George, an ingredients analyst at Euromonitor International. “The anticipated revolution has not quite happened.” Improving the taste could help to revive growth rates, and producers are testing new formulations, George says. In 2018, Cargill plans to introduce its next-generation stevia, called EverSweet, which the company says is easier to make in large quantities and doesn’t have any hint of liquorice flavouring. ED&F Man plans a new product in 2017 that it says is “virtually indistinguishable” from sugar. Archer-Daniels-Midland, one of the biggest producers of highfructose maize syrup, is experimenting with improvements to its Sweetright brand. Stevia may be the industry’s best chance so far to cut back on sugar, from which consumers have been slowly turning away. “There is this war on sugar waging, so stevia is in a good place,” says Sara Girardello, head of high-intensity sweetener research at LMC International in Oxford. “Everybody is in it now,” she says. Source: Bloomberg



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EXPANDING CAPACITY WITH CONSUMER HEALTH IN MIND Broadway Bakery Ltd., one of the oldest bakeries in Kenya, has recently commissioned a new fully automated Werner & Pfleiderer (W&P) bread plant at their factory in Thika, Kenya. The company has turned bread marketing on its head after introducing the highly successful #BeSugarSmart campaign in mid-2016. Food Business Africa had a conversation with Mr. Bimal Shah HSC, the Managing Director of the company, to discover what next for the company after it commissioned the new plant.


The company produces a range of white and brown sliced and unsliced bread varieties in 200g, 400g, 600g and 800g sizes


he demand for bread and other baked products is on the rise in Kenya and Africa at large. Rising urbanization, improving economic prospects and the increasing need for convenient, ready food products has boosted the demand for these products, even in the peri-urban and rural areas. As diets change, with more consumers getting their hands on processed food products, concerns have emerged of the rise in lifestyle diseases which have been blamed on the poor diets and sedentary lifestyle of most households, with devastating effects on public health and a rise in premature deaths. For example, in Kenya, the Non-Communicable Disease

Alliance of Kenya (NCDAK) reckons that 60% of all the deaths will be caused by bad eating habits by 2030. Around the world, rising consumption of sugar has been found to be a major contributor to a rise in a number of lifestyle diseases, including obesity, diabetes and heart disease.

#BeSugarSmart campaign delivers

Broadway Bakery, in an unprecedented move, decided to face the problem of excessive sugar in food and beverage products head-on, by launching the #BeSugarSmart campaign last year.

The company’s #BeSugarSmart campaign has been a huge success. It asks consumers to be conscious of their daily sugar intake both in the foods and beverages they take, as well as in the added sugar they consume 32


The countrywide campaign was Kenya’s first-ever corporate campaign to directly inform the public on the causes of lifestyle diseases that have rapidly escalated in the country. The campaign raises awareness on the damage caused by excessive sugar consumption and on how best to reduce sugar consumption. “Our bread making has been driven by the mission of creating healthier bread with low sugar, salt and fat content, no added additives and dough that is rich in essential nutrients including fibre, protein, carbohydrates, vitamins and minerals,” said Broadway Bakery Managing Director Mr. Bimal Shah HSC, as the company launched the campaign in May 2016. “As we watch lifestyle diseases not only knocking out an older generation of Kenyans, but also increasingly damaging the health and lives of younger Kenyans, we now feel the need to dedicate some of our revenues to alerting consumers on the real horrors of excessive sugar consumption,” he said. The company has used a number of platforms to promote the campaign, including billboards, delivery vans and social media to pass on the message, where the company has appointed a Brand Ambassador, DJ Mo, a popular disc jockey to lead the campaign. It has also partnered with a number of organisations, including at the World Diabetes Day in November 2016, where the company sponsored free diabetes testing at a number of locations FOODBUSINESSAFRICA.COM

The #BeSugarSmart campaign is the best campaign we have ever done. Other food and beverage companies have also started marketing reduced sugar in their products. Mr. Bimal Shah, Managing Director, Broadway Bakery Ltd.

in Nairobi and Thika. This year, the company is planning on conducting free diabetes testing in a number of locations around World Diabetes Day, which falls on the 14th of November 2017. Further, the company has spoken at the industry-focused Africa Manufacturing & Safety Summit (AFMASS) Conference & Expo in the 2016 and 2017 editions, where it has engaged with industry players and regulators on the sugar debate, encouraging the industry to reduce sugar in their formulations to safeguard public health, besides releasing information on research the company has conducted in line with sugar intake in Kenya. “It is an issue that food producers need to wake up to, consumers and parents need to understand and we all need to play a part in preventing, which is what has prompted our #BeSugarSmart drive,” said Mr. Devan Shah, the Business Development Executive at the launch of the campaign. “It is our hope that as we gather momentum in alerting the public to the scale of the danger from excessive sugar consumption, others will now join us in effecting real change in Kenyans’ eating habits and in our health profiles moving ahead,” said Mr. Devan. But how has the campaign performed? “The campaign has been a blessing for us. It was a very bold move we had to take. All these

New automated mixing equipment has been installed reducing mixing time and producing better quality bread

years, the bread market has been controlled by manufacturers that were putting a lot of sugar in their baked products and enticing consumers that the sweeter bread was superior. Since the inception of Broadway Bakery in 1958, I personally never liked bread that is too sweet as bread has to taste like normal bread and not like confectionery,” he reveals. “We then conceptualized the #BeSugarSmart campaign. Despite the initial uncertainties, we had to take the bold step and stick by it. Of all the campaigns we have done, we feel this is the best we have done as a company. Other food and beverage companies have also started marketing reduced sugar in their products,” he said with an air of satisfaction. Through this campaign, the company has also seen an uptake in demand, even in areas where it had not had a strong market penetration. “We have seen a great shift in Western Kenya where consumers predominantly used to like sweeter bread. They are now accepting Broadways bread after about four months of intensive campaigns,” Mr. Bimal says. He believes that the way forward for the bakery sector in the region is for the sector to come up with a maximum level of sugar in bread as a percentage of the dough. With such controls, it is much easier to achieve universal consumer health and sustainability.

One of the oldest bakeries in Kenya

The new plant’s hoisting and dough dividing system improves productivity and increases accuracy and worker safety FOODBUSINESSAFRICA.COM

Broadway Bakery has been running 3 plants at its Thika factory, producing mainly white and brown unsliced and sliced bread. Located in the heart of the Industrial Area of Thika, an industrial town 50 km North East of Nairobi, the company has been in operation since 1958, hence its tagline, “Keeping Kenyans Healthy Since 1958.” The company was started by Mr. Bimal’s father and uncles who started a small bakery in Thika town and thereafter distributed bread for another industrial bakery in Nairobi up to 1975. However, they were not able to satisfy their demand and so they decided to put up their own industrial bakery in their present site in 1978. “Our location gives us easy access to Nairobi, Eastern and Central Kenya, enabling us to deliver fresh bread to you every morning for a healthy start,” says the company. It is now making inroads into the Rift Valley and Western Kenya FOOD BUSINESS AFRICA | SEPT/OCT 2017


MY COMPANY, MY STORY | BROADWAY BAKERY as it grows its production capacity. The company produces Broadways Bread, which is well known for its signature waxed paper packaging, although the company also packages a small quantity of its bread in plastic packaging. “At Broadway Bakery, we have a commitment to quality because we understand the central place of bread on breakfast tables across Kenya. Our range of both Brown Bread and White Bread caters for diverse tastes, all packed in different sizes to accommodate for the exact needs of your family and occasions,” says the company. Beyond the Broadways brand, the company has added new brand extensions including Seneta and a new sandwich bread brand, Kati Kati. With the commissioning of the new plant, Kati Kati has been launched and is mainly targeted at the increasing health-conscious Kenyan. It is a square bread ideal for sandwiches, but can also be enjoyed on its own. The bread products at the bakery range from 200g, 400g, 600g and 800g packaging, both in waxed paper and plastic packaging. The company is focused on building more capacity and entering new market territories in Kenya, which has led to new investment opportunities. “The bakery industry in Kenya has seen a lot of growth in the last 5-7 years. Big players like us had excess supply already, so we never planned to renovate or install new machines when the old ones were still running. But one lesson we have learned after installing this new machine is that we should have invested in new technology before, and if we had done so, we could not have lost the market we lost to our competitors. But we have started recapturing the market again.”

New plant, new horizons

Bread in the fully-enclosed, atmosphere-controlled new cooling towers takes a shorter time to cool giving it better structure and freshness 34


Broadway Bakery has recently commissioned a new fully-automated Werner & Pfleiderer (W&P) toast bread plant to take advantage of the rising demand for baked goods in Kenya, by scrapping their first plant which was installed in 1977. The company currently has in production four bread plants. “We have invested in the new plant so that we can adopt new technology and bring in more efficiency. Besides investing in a new bread plant, the company has also invested heavily in new mixing technology from Diosna, Germany, to achieve better dough handling and quality of bread,” summarizes Mr. Bimal. The new plant will enable the company

With this new plant, we can now make more sandwich bread which the majority of Kenyans have developed a taste for. We are now focusing on the promotion of our new sandwich bread, Kati Kati. Mr. Bimal Shah, Managing Director, Broadway Bakery Ltd.

to improve production efficiency and reduce costs significantly. It has also enabled them to adjust to surges in demand and meet new market opportunities. “The power and fuel consumption of the new plant is stated to be 20% lower compared to the older plants. Since the plant is barely 2 months in operation, we are still developing the figures and will know with certainty after six months the efficiency of the new technology,” he noted. The company has also been able to reduce the number of staff per plant by 4, but has retained most of them to train them on the new technology. The new plant has a number of improvements, right from the dough mixing station to the proofing, baking and cooling stations. According toMr. Bimal, quality wheat flour for bread making is very essential. Through its sister company, Bakex Millers Ltd., who are pioneers in milling good quality bakers and biscuit flour, the company ensures that the quality of the bakers flour supplied to them is of the highest quality. The dough manufacturing process used is still the traditional sponge and dough process. The time taken to prepare the sponge to the time the bread is ready for packing takes about 5 hours. The company has also invested in fullyenclosed, atmosphere-controlled bread cooling towers and is further investing in new wax-packaging machines from BNW, UK, that will continue to be installed till March 2018. “With this new investment in new wax paper packaging machines, we should be able to control our packaging costs to match efficiency and be on the right side of the psychological thinking with the consumers moving away from plastic packaging,” he added. Mr. Bimal is confident that the new plant will enable the company to reach new horizons. “With this sort of plant, it is what FOODBUSINESSAFRICA.COM

The company is investing in more packaging machines so as to meet demand for bread packaged in waxed paper due to new packaging regulations in Kenya

you want to make out of it. As far as we are concerned, we are seeing a big improvement in the quality of bread compared to the older plants. With this new plant, we can now make more sandwich bread which the majority of Kenyans have developed a taste for. We are now focusing on the promotion of our new sandwich bread, Kati Kati,” he informs us.

Changing packaging regulations

The baking industry in Kenya has over 300 bread manufacturers from large to medium to small-scale. 90% of the bread is packed in polyethylene (PPP) bags. However, Broadway Bakery has been packing more than 80% of their bread in waxcoated paper which is biodegradable and environmentally friendly. With the change in packaging regulations, the company sees a very bright future and increase in its demand. “The ban has been a blessing in disguise for us. All these years, we have stood by what we thought was very important for the history of Broadway Bakery. We wanted to continue using wax-coated paper because our loyal customers were used to it, despite being more expensive than polyethylene” Mr. Bimal explained. The company has its own printing and wax-coating facility which ensures a steady supply of the packaging material.

Future investments and industry trends

The baking industry is at an important point of development and is set for new highs FOODBUSINESSAFRICA.COM

driven by new technology, new investments and changing consumer needs. “Apart from the growth in bread consumption, there has also been a tremendous growth in other baked food items such as the mandazi (buns) and doughnuts, he informs us. “A lot of bakeries are putting up new plants now. We recognize them for their competition but we do not get frightened anymore since we have the technology. We only need to push as much as we can so that we get a bigger market share than we used to have,” he stresses. “There is a lot of opportunity. We are not going into products where there is a lot of competition. We want to do something completely different. We want to be recognized as a group with foresight.” In this regard, the company plans to enter the baked confectionary products business by the end of this year using new and current machinery and is also pushing its way into the Western Kenya market where they see huge potential. “We started selling our bread in Eldoret town a few years back and I am now very confident that with our penetration of the market into Western Kenya, we feel that there is a possibility of starting a new production facility in that region in the near future.,” he informs us. At the industry level, Mr. Bimal feels that the industry is mature and strong enough to stand on its own, but that investments by international or regional brands will soon happen. “The baking industry in Kenya is managed by very strong family groups,” he says. “But there are a number of companies interested in merging with local bakery groups, but which have never gone through because of the quality of some of the interested parties.

We have had a lot of inquiries from South Africa, but unfortunately, South African conglomerates wanting to come to Kenya have a different perception of the way they operate and how Kenyan enterprises operate. You can see some past mergers with South African companies have not worked out well.” “When the interested parties are from Europe, America or Far East, there has always been a lot of wait and see. I am glad to say that a lot of Indian companies are now coming in very strongly since there is a bit of understanding between the way they work and the way we work here. A merger is something that you only have to do if you are comfortable. You are not going to merge for the sake of merging, only to eventually put a big dent in what you have built for all these years when the merger doesn’t work out. We are taking it cautiously. We are all working towards it and I think eventually in 10 years’ time, things will go that way.” He is also amazed at the growth of small-scale bakeries, especially in major towns. “There are probably hundreds of small bakeries being run by local investors in Kenya and the size of their operations is not small anymore. They are now in the medium range. If you go to the Kariobangi area of Nairobi, you will not believe the amount of wheat flour they use there in the small bakeries - which is also a good thing. That is the way we are going to have local participation in industries. It is not only the big players that will make the industry grow.”

Community impact that adds value

The company is proud of its association with Broadway High School, a public school supported by the family as a development partner. Located in the disadvantaged Kiandutu Slum in Thika town, the family has assisted in building tuition blocks, laboratories and a modern library block, geared towards enhancing teaching standards in the school. The current student population is over 650. The company sponsors bright students for university education once having completed their high school. The company also supports a number of other medical, environmental and social support programs in the country. Last year, the company donated 150 hospital beds to various medical institutions. FBA



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RICE PRODUCTION & MILLING IN NIGERIA The Government of Nigeria, the world’s second largest importer of rice, has initiated a number of policy initiatives in the last few decades to boost rice production and processing in the country. Despite these initiatives, the country continues to import large quantities, as local production stagnates. We review the rice production and milling sector in the country, and what the future holds.


ice is to Nigerians one of the important foods, consumed by the rich and the poor, as Africa’s most populous country seeks to feed its rising population. Even as the choice of food keeps changing and diversifying in the country, rice remains at the base of what Nigerians would consume on any regular day. Rice has weaved itself into a critical part of some of the most favorite foods in Nigeria, with some of the most popular rice dishes including the famous jollof rice (cooked rice with spiced tomato paste); plain rice that accompany many stews;


masa (a fried dough made from rice flour and water); tuwo (rice flour that is prepared into a paste and is often eaten with soup); coconut rice (plain rice cooked with added coconut powder or milk); and many other variations. It cannot be left unsaid that rice is also used as a gift in many communities in Nigeria.

Important food and cash crop

Rice is Nigeria’s most important food and cash crop, providing vital food security and

farmer incomes more than any other crop, according to the UN’s Food & Agriculture Organisation (FAO). The country is the leading consumer and second biggest producer in Africa and the second largest importer of rice in the world, after China. But this was not always the case. From the 1960s, rice was not a priority crop and food in the country, with the country lagging behind other West African countries in per capita consumption. Between 1960-75, per capita consumption of rice was a paltry 3 kg in Nigeria, way lower than the 21 kg that the West Africa MILLING & FEED AFRICA | SEPT/OCT 2017



Rice Production & Consumption in Nigeria (1000 MT) 6000 5000   4000   3000   2000   1000   0  

1970 1975  1980  1985  1990  1995  2000  2005  2010  2015  2016  2017   Consump3on  

regional average, while the country was producing 99% of its 179,000 metric tonnes demand. Rising urbanization, improving economic prospects and changing dietary preferences from the late 1970s into the


In 2010, out of 4.8 million tonnes local consumption, only 2.8 million tonnes were produced within the country, meaning that the country has been forced to import more than 2 million tonnes per year for almost

The Federal Ministry of Agriculture & Rural Development estimates that ATA produced extra 1.2 -1.5 million tonnes of milled rice in 2015. 2000s catapulted consumption of the once for-the-rich commodity into the pots of the newly arrived urban poor, raising per capita consumption in the 1980s to 18 kg and 22 kg by end 1999. In 2016, it is estimated by the US Department of Agriculture that per capita consumption had reached 40 kg per person per year. Parboiled rice is the most common type of rice consumed in the country. The country has some of the highest increases in production and consumption since the 1970s (see Graph 1). The gap between local rice production and consumption has also increased significantly, slowing down somewhat in the last 10 years. In terms of production, Nigeria produced 280,000 tonnes of milled rice in 1970 while consuming 285,000 tonnes. By 1980, the country was consuming 850,000 tonnes while producing only 523,000 tonnes. 38


20 years, despite rising local production over the years, losing US$2.5 billion in the process per year.

Policy interventions to reduce imports, boost local production

Realizing the key role that rice plays in the country’s economic and food security situation, the Government of Nigeria (GON) has probably attempted some of the most well-known, often criticized, policy interventions to improve domestic production and reduce or eliminate importation of rice

over the decades. From imposition of import bans, curtailing of foreign exchange availability to importers, tax breaks to local producers, schemes to reduce input costs and provision of financing to local farmers,

Nigeria has tried some of the most wideranging efforts to fill the gap between local production and imports, with mixed results.


he country’s quest to be self reliant has been a difficult one, not made any easier by surging demand for the commodity, as the urban dwellers and the rural folk take a liking for the convenience offered by rice to feed the over 180 million Nigerians. The Agricultural Transformation Agenda (ATA), debuted by the government of Goodluck Jonathan in 2011 and spearheaded by the famous Minister for Agriculture & Rural Development Dr. Akinwumi Adesina, focused on how to reinvigorate and make Nigeria’s agriculture sector more productive, efficient and effective, with a focus on promoting agriculture as a business. ATA set a target of creating 3.5 million jobs by 2015, generating foreign exchange, and reducing spending on food imports. A federal fertilizer procurement system, which came in handy to reduce pilferage and streamlining distribution and access across the country, was one of the key achievements of ATA. However, despite the government’s insistence on increased production, and Nigeria approaching ‘self reliance’, the quantities of locally produced rice has hovered around 2.8 million metric tonnes since 2010 according to USDA figures. The Federal Ministry of Agriculture & Rural Development (FMARD) however, estimates suggest that ATA produced an extra 1.2 million to 1.5 million tonnes of milled rice from about 3 million in 2011, when ATA was conceived, meaning that total domestic production of rice should have been between 4.2 and 4.7 million tonnes at the end of 2015. At the end of the government of Goodluck Jonathan’s term, the new administration headed by General Buhari formulated a new policy, the Agriculture Promotion Policy (APP) in 2016, which borrowed heavily from the ATA but with a mandate to reduce the supply gaps for major commodities in the country and raise quality standards to promote exports so as to increase the forex flowing into the country through the agriculture sector. The APP has placed rice at the top of the chain in terms of the key local crops to focus on, followed by wheat, maize, soya beans and tomatoes till 2018, before adding other crops and fish into the list. The program aims at reaching rice self-sufficiency in the country by 2018, to meet a projected 6.3 million tonnes of FOODBUSINESSAFRICA.COM

Table 1: Some of the key policy interventions over the years by the Government of Nigeria to boost rice production and processing in the country. Dates of establishment




Federal Rice Research Station (FRRS)


National Accelerated Food Production Program (NAFPP)

Development of improved varieties of grains


National Cereals Research Institute (NCRI)


The Operation Feed the Nation (OFN)


Abakaliki Rice Project


Nigerian Agricultural and Cooperative Bank (NACB)



Agricultural Development Project (ADP)

The Presidential Rice Initiative


Agricultural Transformation Agenda


Anchor Borrowers Programme


Agriculture Promotion Policy

Adapted from Emodi and Madukwe

milled rice demand in the country. The government has also introduced a new policy initiative to build capacity of local processors to procure locally grown rice as part of the initiatives to boost local production. The Anchor Borrowers Program (ABP), which was debuted in late 2015 by the Central Bank of Nigeria (CBN), creates a linkage between anchor companies involved in the processing and smallholder farmers of a number of key agricultural commodities, including rice. The ABP aims to create economic linkage between smallholder farmers and reputable large-scale processors with a view to increasing agricultural output and FOODBUSINESSAFRICA.COM

Design, test, and transfer technology package for production of rice, maize, sorghum, millet, and wheat

Research on high-yielding rice varieties for farmers, onfarm adaptive research, seed multiplication, and training of extension staff Self-sufficiency in domestic food supply

Rice production and processing Policies on rice production were implemented

Special credit schemes to boost rice production Addressing the widening demand supply gap and attain self-sufficiency in rice production

Promote agriculture as a business, integrate the agricultural value chains and make agriculture a key driver of Nigeria’s economic growth Create linkage between anchor processing companies involved and small holder farmers (SHFs) of key agricultural commodities

Delivering sustained prosperity by meeting domestic food security goals, generating exports and supporting sustainable income and job growth

significantly improving capacity utilization of processors. The programme provides farm inputs in kind and cash to small holder farmers to boost production of these commodities, stabilize inputs supply to agro processors and address the country’s negative balance of payments on food. At harvest, the farmer supplies the produce to the agro-processor (anchor) who pays the cash equivalent to the farmer’s account. The program relies on the capacity of private large-scale integrated processors (and state governments) to off-take the harvested produce at the agreed prices with the farmers to succeed, and has received a



TONNES OF RICE IMPORTED INTO NIGERIA EVERY YEAR, MAINLY FROM ASIA number of high profile companies signing up for the scheme, including Olam, Dangote Group among others. Beyond production matters, policy interventions have also been introduced by the Buhari administration that have impacted the rice industry in the country, chief of which is the foreign exchange restrictions that were introduced in 2015. Rice was one of the 41 goods and services that were barred from accessing foreign exchange from official government channels. Though this measure has been relaxed somewhat, currency devaluation that has hit the country and the continued rise of imports has led to a reduction in local consumption, while making Nigerian domestic rice to be cheaper in the surrounding countries in the region. One of the biggest obstacles to the country meeting its local production and milling capabilities is also the huge quantity of rice that is imported illegally into the country. It is estimated that about 40% of the total rice imports (about 800,000 metric tonnes) are smuggled into the country through Benin and Niger. This can be illustrated by the sharp rise in rice imports by Benin, which was importing 180,000 tonnes in 2010, rising to more than double to 475,000 tonnes in 2017, with a particularly high 25% rise in 2015, when the Nigerian government instituted the forex restrictions on rice imports.

Local milling of rice picks up steam

The GON has encouraged backward integration of rice in Nigeria that has boosted private investment in domestic rice milling with an additional capacity of 1.2 million tonnes per year being installed in 2016. In November 2016, the Federal Ministry of Agriculture & Rural Development announced a plan to facilitate the procurement of 40 new large integrated rice mills to boost the uptake and processing of rice in the country. MILLING & FEED AFRICA | SEPT/OCT 2017


Guests at the opening of Olam’s factory in Nasarawa State in 2014

“To attain self sufficiency in rice, stakeholders note that it would take years of effective policy implementation, funding in seed development and paddy production, and infrastructure investment says a report by” USDA According to GAIN, 24 large-scale industrial millers process only 12-24% of the domestic rice. Small and medium scale millers that dot the country, mainly in the key rice growing regions of the north and northeastern regions of the country, process the rest. The main rice importing conglomerates, which handle more than 90% of the rice imports into the country officially, continue to receive lower import 40


tariff of 30% as compared to 70% for other rice importers, as the GON gives them a lower import duty to encourage them to boost their investments in domestic processing of the grain. Capacity utilization by the majority of the integrated rice millers, reported to be below 25%, is a serious setback to the GON’s push to encourage more investors to join the Anchor Borrowers program and thereby provide market for the small-scale rice farmers across the country. However, Nigeria’s rice sector is still driven by small mills operating outdated mills and applying mostly traditional methods. It is estimated that 10,000 such mills exist in the country, each averaging 1 tonne milled rice per day, and responsible for about two-thirds of the total domestic rice processing, or some 1.8 million metric tonnes per year, according to GAIN. These mills however, produce low quality grain with a high percentage of broken grains, leading to the preference of mainly urban dwellers to seek out imported rice which are cleaner and longer, further

aggravating the imports problem. Medium scale millers have fairly sophisticated equipment and are able to utilise their mills more effectively due to their smaller size and close proximity to farming communities, and due to the fact they also act as traders, supplying excess produce to either local markets, NGOs or even into the regional markets. “To attain self-sufficiency in rice, stakeholders note that it would take several years of effective policy implementation, funding in seed development and paddy production, and infrastructure investment,” says a report by USDA.

Conglomerates focus on processing

Rice trading and processing is big business in Nigeria, and recent moves by major conglomerates to invest in integrated rice value chain and processing bodes well for the country, if domestic production can be streamlined through their engagement FOODBUSINESSAFRICA.COM

INDUSTRY REPORT | RICE IN NIGERIA with farmers across the country to improve yields and reduce wastage. A number of conglomerates have become major players in Nigeria’s rice importing, trading and milling industry, mainly producing parboiled rice. These include the Stallion Group, Wicklow Group and Olam Group among many others, who have already set up integrated rice production and processing units in the country. Africa’s richest man, Dangote has joined the long list of investors seeking to work with the GON to boost the sector. Dangote Group is making a five-year investment of at least $1bn to grow and process rice in












seven Nigerian states, bringing sub-Saharan Africa’s biggest importer of the grain closer to its goal of self-sufficiency. Dangote Rice, a subsidiary of the Group announced in June its plans to grow rice on 150,000 hectares of land with projections to harvest 1.7 million metric tonnes of raw rice by 2019. The company plans to invest in seven northern states of Jigawa,

capacity, with a total parboiling and drying capacity of 230,000 tonnes of milled rice per year. The other conglomerate with a focus on rice is Olam Group. Through their Olam Grains business line, the company in 2013 invested 19 billion Naira in a planned integrated 10,000-hectare farm with rice mill facility in Rukubi, Nasarawa State that

“Our vision is to preserve and enhance rice production

in Nigeria by ensuring genetic integrity of seeds, encourage scientific agricultural practices and promote world-class processing.” Hapreet Singh, Director Stallion Group Kano, Zamfara, Niger, Sokoto, Kogi and Adamawa, investing US$1 billion over 5 years. It will also build rice-processing mills with capacity to process up to 1 million tonnes of parboiled rice by 2019, with the first plant ready by early 2018. The country’s biggest rice processor and trader, Stallion Group through its Stallion Popular Farms and Mills Limited aims to increase its current capacity of 450,000 tonnes per year to 1.5 million tonnes, by increasing its integrated rice value chain and enhancing its milling activities, according to Group Director Hapreet Singh. “Our vision has always been to preserve and enhance rice production in Nigeria by ensuring genetic integrity of seeds, encourage scientific agricultural practices and promote world-class processing techniques to emerge as industry benchmark for product quality,” he said mid 2016. According to a report by GAIN, the Group has 600 tonnes per day capacity plant, and another mill originally built to polish imported brown rice of the same

targets to produce 36,000 tonnes per year of milled rice. The company’s Mama’s Pride and Mama’s Choice brands are already being sold in the country. Currently 3,000 farmers are engaged in the program, with a target of 16,000 by 2018. The Wicklow Group, another conglomerate player in the sector opened its new integrated rice farming and processing operation in its 25,000 tonnes per year mill, producing 16,250 per year of milled rice. Other investors in the rice value chain include BUA Group, with 200,000 metric tonnes per year rice mill; Milan Group, Golden Penny, Honeywell among a long list of companies. With these investments and the GON’s fairly consistent focus on boosting domestic production as well as processing of the commodity in the country, the rice sector in Nigeria is poised to grow to greater heights, contributing to the economic and nutritional benefits that the country so requires. AMF




Investing in Nigeria’s animal feeds and protein

Olam International recently opened a poultry feed mill and day-old-chick hatcheries in Kaduna State and started production at an integrated poultry and fish feed mill in Kwara State, both in Nigeria. Food Business Africa magazine had a discussion with Sharad Gupta, the Senior VicePresident of Olam Grains and Head of Olam Animal Feeds & Proteins about the impact of the US$150 million investment on Nigeria and the region.

We hope to make animal protein easily available and and more affordable for Nigerians. This will bolster domestic food security and enhance nutrition.

What is the importance of Olam’s recent investments in the state-of-theart animal feed mills, poultry breeding farms and hatchery? Nigeria’s poultry production and consumption is significantly lower than comparable developing countries in Asia and Latin America. With a growing population and emerging trend of proteinrich diets, Nigeria needs to significantly boost its production capacity for eggs, poultry meat and fish. Olam’s investment in the Animal Feeds and Proteins (AFP) business reflects our commitment in supporting Nigeria’s agenda for self-sufficiency. Our facilities will support the poultry farmers in getting high-quality feed and healthy day-oldchicks (DOC) at competitive prices. Along with the on-farm support from our field veterinarians, this will encourage more youth to take up poultry farming, generating local employment and stimulating the broader rural economy. It also will support the reduction of foreign exchange spend on poultry and fish imports. What are the expected impacts on the community and economy in the areas in which the facilities are located? A large project like ours impacts and 42


stimulates the communities in three different ways – as suppliers, as employees and as customers. Our feed mills will source raw materials such as soybean and corn from local farmers, and we would work towards improving their farm productivity and income. Our new facilities will create up to 600 direct skilled jobs, including positions for veterinarians, aquaculture technicians, agronomists and many more. Our feed milling and DOC output can have a ripple effect to create 200,000 to 250,000 rural jobs for small-to-medium poultry and fish farmers. Through higher capacity and improved efficiencies, we hope to make animal protein easily available and more affordable for Nigerians. This will bolster domestic food security and enhance nutrition, especially for children and young adults.

and process proteins to feed the rising population?

How important are Public-Private Partnerships (PPPs) in attracting investments by corporates into Africa? Our AFP project is fully funded and owned by Olam, so it is not technically a PPP project. However, we received very good support from the Kaduna State government in procuring land, getting project clearances and site security. We have also sought concessional agricultural loans under the various Nigerian Federal government schemes, which once available will enable us to offer more benefits to our customers. We believe that such an investmentfriendly approach, either through PPPs or other mechanisms, will definitely encourage more corporates to consider investing in Africa.

What opportunities do you still see in the poultry and fish (and general animal nutrition and husbandry) industry in Nigeria and Africa at large? Nigeria’s poultry and fish farming has a huge opportunity for boosting efficiencies; for example the average egg output per laying hen is just about 200 eggs, compared to the standard output of 320-330 eggs from an efficient layer hen. Similarly, the feed conversion ratio (FCR) varies from 1.8-2.5 for broilers and 1.4-2.0 for catfish, compared to global norms below 1.60 and 1.00 respectively. There is tremendous scope in improving farm management practices, especially biosecurity across most farms in Nigeria. Avian Influenza (AI) has impacted poultry farms across many parts of the world, and Nigeria is currently quite vulnerable to the rapid spread of AI. Other areas of improvement are recordkeeping, data analysis and early illness diagnosis.

Food imports are projected to rise substantially into Africa, if productivity is not boosted. What effect would you think your investment would have on boosting local capacity to produce

We estimate that Nigerian poultry meat consumption can increase 10-fold and egg consumption 4-fold, in order for Nigerians to reach average global consumption levels by 2040. There is no reason for Nigeria to meet this demand through imports, as it loses the opportunity to create large-scale employment and economic value-addition locally. Our poultry facilities at full scale can help local farmers produce approximately 8 billion eggs and 100 million kilogrammes of poultry meat - the equivalent of 40 eggs and 0.5 kilogrammes of chicken per Nigerian per year. This will be a significant addition to current local production and we will be happy to expand our capacity, as the demand picks up.


4 Good Reasons to be at AFMASS 2018 in Kenya & Zambia Reason #4

TWO CONFERENCES, TWO COUNTRIES, ONE CONTINENT What are some of the reasons why Olam has been hugely successful in Nigeria, despite the perception that Nigeria is a tough place to do business? Olam has been in Nigeria for over 27 years, operating across several agricultural value chains. Through this, we have built a strong understanding of the Nigerian business landscape and grown deep roots. Our operating managers understand the local challenges and proactively plan for handling them, so that we don’t have big surprises. With over 7,000 employees in Nigeria, we can claim to know the country well enough. Olam has grown in Nigeria and other countries in Africa by aligning itself with the national agenda and building strong local relationships with stakeholders – farmers, local communities and governments. Risk factors that do exist can be mitigated through sound risk management along with social and environmental due diligence. What next for Olam in Nigeria and Africa, especially in the grains sector? Olam’s Grains business is currently focused on our wheat-milling footprint across four countries in Sub-Saharan Africa and this new Animal Feeds and Proteins business in Nigeria. We see further opportunities in strengthening our participation in these segments. We are also working on expanding our value chain participation by supporting local production of soybeans and corn. We continually evaluate the opportunities for expanding our geographic and/or product scope, but are not in a position to disclose any such future plans.



The industry in Africa’s is thirsty for knowledge that will reduce their costs, improve efficiency and eliminate risks to their businesses. The conferences at AFMASS 2017 are designed to inform investors, industry managers, Govt. regulators and other stakeholders of the latest innovations, policies and technologies that Africa must adopt to meet the needs of a growing industry and population And, with two locations in Kenya and Zambia in 2018, AFMASS continues to be the perfect location where learning about Africa’s industry is taken to new levels. Sign up today on the website to sponsor, exhibit, visit and attend the conferences and expos today FOOD BUSINESS AFRICA | SEPT/OCT 2017



GEA acquires Italian pasta equipment maker Pavan Group

GERMANY - The German engineering group GEA has acquired the Pavan Group, the leading supplier of extrusion and milling technology. Known for it’s processing for fresh

and dried pasta, pelleted snack products and breakfast cereals, GEA has acquired the company from Luxembourg-based private equity fund, Alpha Group, which held a majority stake in the group and Idea Cinquanta Srl, controlled by Andrea Cavagnis, Chairman and CEO of Pavan Group. “The acquisition is an important milestone in our stated growth strategy of expanding GEA’s activities in the area of food processing. With its extrusion knowhow the Pavan Group builds an attractive platform for us to extend the technology portfolio. In strategic terms, therefore, the company is an excellent match for us and will help to promote growth at GEA going forward,” explained Jürg Oleas, CEO of GEA Group.

With several production plants in Italy and China, GEA plans to integrate the new venture into its Business Area Equipment, where it shall establish a dedicated new product group called Pasta, Extrusion & Milling.” According to GEA, the company has historically had a long exposure to the dairy industry which recently has gone through a major downturn, with dairy processing solutions order intake declining from the peak in 2013 by €250-300 million to 2016. The company has been on an acquisitive stake of late, buying Comas and Imaforni to expand into the bakery industry. Pavan’s pasta and extrusion as application and technology acquisition gives the fills a gap that GEA has been having in its capabilities and technologies, it says.


Bunge to acquire 70% of specialty oils major IOI Loders Croklaan SWITZERLAND – Bunge, the global agribusiness and food company, has entered into a definitive agreement to acquire a 70% stake in IOI Loders Croklaan, a global leader in specialty oils for the food and related industry for US$946 million. The transaction will expand Bunge’s value-added capabilities, reach and scale across the world, establishing Bunge as a global leader in B2B oil solutions for many

industries. “Together with Loders, we will have a comprehensive product offering derived from seed and tropical oils, with leading innovation, application capabilities and sustainability programs. This complete seed and tropical oil portfolio will position Bunge to be a full service partner and uniquely able to help our customers innovate and grow for the future, said Soren Schroder, Bunge’s

Chief Executive Officer. Loders, a leader in the growing US$33 billion semi-specialty and specialty B2B oils market, has a wide portfolio of palm and tropical oil-derived products with key strengths in the confectionery, bakery and infant nutrition applications. The deal provides Bunge with the right to purchase the remaining interest in Loders from IOI after five years.


Bühler Group acquires the bakery and candy systems maker, Haas Group SWITZERLAND - The Bühler Group has acquired the Haas Group, the Austrian world market leader in wafer, biscuits, and confectionery production systems, enabling Bühler to complete its Consumer Foods product portfolio. Haas, a global leader in the production

systems for wafers, hard and soft biscuits, ice cream cones, cakes, and baked goods generates sales revenues of about EUR 300 million and operates its own manufacturing sites in 6 countries. The acquisition enables Bühler with the opportunity to add wafer and biscuit

production systems to its chocolate mass and its end products along the entire value chain. “We operate in the same markets and often serve the same customers, but there is no overlapping of our products and services,” says Bühler CEO Stefan Scheiber


Diversey back as stand-alone company after private equity fund buy USA - Diversey, the leading hygiene and cleaning solutions company, has been bought by Bain Capital Private Equity from Sealed Air Corporation finishing a process announced in March this year. According to Diversey, it will now be a standalone company that will include the Diversey Care division of Sealed Air as well as the food hygiene solution business that 44


was part of its Food Care division. It will integrate chemicals, floor care machines, tools and equipment, with a wide range of technology based value-added services, food safety services and water and energy management. “As an independent business, we will have the ability to be smarter and more agile than ever before as we introduce

enhanced technology and innovation. As we work together with our formidable new ownership, our customers will be our singular focus,” commented Dr. Ilham Kadri, the new CEO of Diversey. Diversey serves customers in the hospitality, healthcare, food and beverage, food service, retail and facility management sectors. FOODBUSINESSAFRICA.COM




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Profile for FoodWorld Media

Food Business Africa Sept/Oct 2017 incorporating African Grains, Milling & Feed  

Africa's Number One Processing, Packaging & Food Safety magazine

Food Business Africa Sept/Oct 2017 incorporating African Grains, Milling & Feed  

Africa's Number One Processing, Packaging & Food Safety magazine