Africa Improved Foods eyes regional market- says CEO
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With just over one month since the launch of its commercial product, Africa Improved Foods is looking to regional markets. The $60 million factory located in the Kigali Special Economic Zone is expected to produce 45,000 tonnes of nutritious foods annually, enough to boost exports and prevent child malnutrition in Rwanda and across the region.
Amar Ali, the Chief Executive Officer of AIF, said the firm would seek to expand to the rest of the continent in a bid to benefit as many Africans as possible in addressing similar challenges with “high-quality” nutritious foods. Amar spoke to The New Times’ Athan Tashobya about AIF’s ambitions and challenges encountered so far in trying to settle in.
What has been the feedback so far on your products since they hit the market?
Very positive so far; we have been building and getting setup for about two years, but in terms of our product launch its been about three months and the commercial product has been one month. Quite new but very positive so far.
How is the competitiveness of your products in pricing and quality in comparison to what is available in the market at the moment?
I think it is clearly more competitive and of a higher quality. I have been to several factories in the region and I can tell you that this is still the best. The inputs are of high quality as well as the nutrition and fortification that go with it. And not forgetting that we do all of that at an affordable price.
We are here with a mission and the mission of our shareholders is primarily about nutrition. We didn’t come to replace breastfeeding, which should be exclusive for the first 6 months and should continue until the child is 2 years old; but we are instead trying to complement breastfeeding from 6 months up and improve nutrition.
We are trying to solve a problem and trying to find a way for Rwanda to feed Rwanda and for Africa to feed Africa. We are a mission-driven company.
We are here to genuinely make a difference. We have a product, made in Rwanda, in Africa, which is as good as anything you can get internationally but made locally from local farmers at affordable prices. That’s the attitude we want to create with this brand.
Does the fact that your prices are low and products made locally create doubt in consumers’ minds?
I hope that instead that would inspire them trusting the quality of the product. I hope people want to eat food that is made locally and take pride in local farmers, local products and would take pride in supporting local businesses.
Where do you anticipate to have your biggest market? In Rwanda or outside the country? Any revenue projections?
Most definitely in Rwanda. But with time, we want to explore export options to the region, for instance, in Uganda.
As for revenue projections, we are not sure for now. Let’s wait and see.
Considering that local farmers have not been able to meet the firm’s input demands as yet, what has been the impact to your production?
Sure, it’s been a difficult start. We had droughts in the region and that has made it difficult and farmers in Rwanda haven’t been able to deliver in terms of quantity and quality.
But we haven’t had any problem with availability; we have had to bring in maize from Uganda and other places in the region to make up for the shortfall here but we know that it’s because this year was difficult. We continue to work with local small-holder farmers here in Rwanda on how we can improve on that model and get the quantity and quality needed for the product.
All the challenges have been caused by weather. Currently, the firm is operating at 80 per cent capacity and we have found ways to cope, so production is not a big problem.
Are there any ongoing efforts to change the status quo in this regard?
It is all solvable. We are trying to work with our partners to improve infrastructure, improve post-harvest processing in terms of drying and so many other ways to improve quality.
We are not agronomists but we work with partners to help farmers. We have about three partners, including NGOs and commercial companies at different levels to put emphasis on post-harvesting processing and improve the quality of maize. We want to expand that and address the issue of quality of maize.
Is your purchase of farmers’ products based on market prices or based on agreement with farmers? Individual farmers or land consolidation?
It is generally the market price. We would pay a bit of premium because we want high quality and that depends on who does the sorting and the cleaning of maize. We buy on the market price but we also pay some premium because we want high quality products.
What are your plans and strategies to maintain production in the event of drought cycles such as the one witnessed in 2016?
First priority is to work with small-holder farmers to improve the quality and quantity of their productivity. This will make them and the country more resilient against bad weather conditions.
Second is to work more with irrigation schemes. Rain can be unreliable sometimes and we need to find ways of finding something reliable. There are some people already doing this in Rwanda and we need to work together in trying to find irrigation sources.
Irrigation generally is a big focus for us.
In terms of growth, we want to be kind of a showcase of what can be done here to attract more investors and drive food export revenues. We want to expand this to various parts of the region, such as Uganda, DR Congo, Tanzania. We also want to start a plant in Ethiopia later this year.
We have quite big ambitions of taking food nutrition and quality to the next level.
Is there an estimated duration to break even considering the cost of production and market consumption of your output?
We are still aiming to have our first breakeven month before the end of next year. That’s the target.
Is there a likely to roll out more products into the market? More brands?
Absolutely! We plan on introducing more brands into the market. Currently, our products are mainly targeting the first 1000 days - which means the 9 months of pregnancy and the first 6 months of exclusive breastfeeding, and then the period from 6-24 months where complementary foods should be introduced in addition to continued breastfeeding. But we also plan to introduce new products that cater for all categories of people. You will definitely see more products on the market soon.