Farmers should seize opportunity for available soya market, Soyco chief says

This newspaper reported last week that Mount Meru Soyco Limited, the country’s only edible oil producing plant, is not operating at full capacity because of inadequate supply of soya beans, the main raw material for their end products. Nick Barigye, the MMSL chief executive, spoke to Kenneth Agutamba on Wednesday to elucidate more on the plant’s current and medium term plans to mitigate the prevalent challenge. Excerpts;- As the chief executive of Rwanda’s only edible oil processing plant, could you tell us more about the factory’s history? Established in 2012, Mount Meru Soyco Limited (MMSL) is a public-private partnership business venture for the manufacture of edible oil and animal feeds from soya beans and any other oil seeds. The vision of MMSL’s shareholders is twofold; one, two-thirds of Rwandans rely on agriculture for survival, but many Rwandan farmers lack access to stable markets and affordable inputs that would allow them to support their families and sustain their livelihoods. As such, MMSL is founded on the belief that locally operated agribusinesses create jobs and help farmers build sustainable livelihoods. These businesses are reliable, long-term buyers for local produce and offer farmers a buffer against the price fluctuations that are endemic to the market. Secondly, Rwanda imports close to 30,000 metric tonnes of edible oil per year, estimated at $42 million. Edible oil consumption is, on average, around 2.5 kilogrammes per capita and estimated to grow to 5 kilogrammes per capita by 2030. MMSL seeks to reduce the volume of oil imports by producing edible oil using locally available raw materials such as soya beans while also exporting to neighbouring countries both edible oil and animal feeds. So your end product would be edible oil and soya cake, what are the main raw materials needed here? Raw materials are soya beans and other oil seeds like sunflower and cottonseed. The New Times last week reported that MMSL is short of raw materials to sustain production... With an installed capacity of 200 metric tonnes per day, we require on average a minimum of 120 metric tonnes per day. We currently have close to 2,500 metric tonnes of soya as inventory, which is growing per day given that we are in the harvest season and we are seeing farmers’ cooperatives and agro-dealers deliver close to 250 metric tonnes per week. What are you doing to fill this raw material gap now and in the medium term? Nick Barigye, the firm’s CEO. (T.Kisambira) With support from the government, especially through the Ministry of Agriculture, and that of Trade and Industry, Office of the Governor of Eastern Province and district mayors of Eastern Province. Since September 2014, we have been having farmer sensitisation and mobilisation tours and campaigns to encourage soya farming. Through these efforts, we are seeing more farmers expressing interest in growing soya beans given the premium price we have offered. We have no doubt that this trend will continue to grow. Do you have any plans to support these efforts with imports? I mean, you could import some of the resources from within the region, isn’t it? We are contemplating buying soya beans from DR Congo and Uganda as well as importing crude soft oils from Tanzania and refine them here. However, this is a short-term strategy to cover the raw material deficit given high transaction costs involved with import of bulk raw materials but also the need to focus on the core objective of setting up MMSL, which is to provide ready market for local produce. It appears that the factory’s current soya challenge is a huge opportunity for not only farmers but produce dealers, how big an opportunity is this? Our long term plans are to work with 10,000 farmers to grow soya beans for which we provide ready market. We also provide premium price of Rwf450 per kilogramme of soya bean, and we introduce farmers we work with to banks to enable them access loans. All these efforts will enable a large number of smallholder farm families to increase their incomes, and have the ability to improve their living condition and quality of life. They will also afford to access available health care, education, and a higher level of food security. Do you have any other handicaps apart from soya seed inadequacy? Like any startup business, competition from imported edible oils is a challenge as well as insufficient local skilled personnel with edible oil industry work experience. Power cuts are a handicap as well as tax on processed animal feeds like soya cake. How significant are your end products in helping Rwanda in reducing its import bill, especially for edible oil? Currently, Rwanda imports close to 30,000 metric tonnes of edible oil and equally imports processed animal feeds. As the only local edible oil processor, we aim to not only reduce the volume of imports but to also export our edible oil and processed animal feeds. There are export opportunities for edible oil in Burundi and DR Congo as well as export opportunities for soya cake in Uganda and Kenya. editorial@newtimes.co.rw

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Farmers should seize opportunity for available soya market, Soyco chief says