August 23, 2011


Namibian feed milling sector builds poultry project



Namibia Poultry Industries is putting up a green field fully integrated poultry project along with an expansion in its feed subsidiary.


Local institutional investors shunned Namibia's first large-scale poultry investment, and in the end it was a South African development investment agency which pumped in money to establish the NAD500 million (EUR48.46 million, US$69.26 million) poultry plant outside Windhoek.

Work is now on schedule at Klein Kapuka Farm where Namibia Poultry Industries is establishing a fully integrated broiler plant capable of producing 250,000 broilers per week.


It would be the first poultry plant in the country where production starts from chicken breeding to packaging of finished poultry products.


It emerged this week that the NMI Group, which is doing the investment, failed to raise money from institutions such as the Development Bank of Namibia (DBN) and the Government Institutions Pension Fund (GIPF), even though the group raised a significant portion of the capital on its own.


"We did engage with [Namibian financial market] but could not strike the right deal," said Namibia Poultry Industries Managing Director Gys White, adding that there was "a bit of resistance and fear" because of the investment being a green field.


The poultry investment has already created spin-off investments for the country, as it creates synergies among NMI Group subsidiaries, with additional employment opportunities.


Besides Namibia Poultry Industries, NMI Group also owns the Namib Mills and Feedmaster companies.


Feedmaster, the subsidiary responsible for animal feed, is investing NAD80 million (EUR7.75 million, US$11.08 million) in its plants, to strengthen its production capacity.


André Snyman, the mill's Managing Director, says the poultry investment created "an opportunity for Feedmaster to further expand its business [into] a local broiler industry".


The present Feedmaster's plant is not able to produce high quality poultry feed, due to insufficient manufacturing capacity on top of an old factory.


Hence, Feedmaster is investing NAD6 million (US$0.83 million) into a new feed mill, which would strictly serve the broiler, layer and pig industries with a combined capacity of 56,000 tonnes per annum, and create 40 new jobs.


The company would also upgrade its existing factory in the Northern Industrial area into a "specialist ruminant feed factory that complies with EU Standards for beef export purposes". For this, the company is investing NAD15 million (US$2.08 million).


Construction of Namibia Poultry Industries plant started in April this year and is scheduled to end sometime next year but it is hoped the plant would be in production by the end of March 2012, with 450 permanent employees.

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