It is a beehive of activity as workers finalise packaging rice sacks as others move back and forth to ensure that everything required for the delivery is in order. Five delivery trucks are also being loaded with rice heading to different parts of the country from the multimillion Kayonza District-based factory.
“We supply all the parts of the country. We are in process of starting to export some of the rice to the region,” said Augustin Nyagatare, the proprietor as he settled down for the interview.
It has, however, not been a smooth journey for the resident of Mukarange sector in Kayonza. Starting off as a street hawker 50 years ago, the founder of Kayonza Rice Production Ltd has endured many challenges and worked hard to become one of the richest men in Eastern Province.
Nyagatare is involved rice production, processing and packaging, producing between 30 to 50 tonnes of rice every day. The firm also makes briquettes (for cooking) from rice husks and maize flour.
The enterprise works with over 2,000 farmers, and its success story was possible because of KCB Bank Rwanda support and the prevailing peace and security in the country brought about by the good leadership of President Paul Kagame, Nyagatare said.
How he started
At the age of 10, Nyagatare dropped out of school to join street vending so he could get a means of livelihood. He was in primary 3 then.
He used to vend different products on the streets of Kigali, including sweets, pancakes, and bread. Later, he opened a small retail business using savings from vending.
He narrated that as hawker, he had a chance to meet different customers giving him an opportunity to understand the needs and tastes of the majority of buyers.
This inspired him to start a more stable enterprise in Gicumbi District in the 80s, selling different products including home use utensils.
“Dealing with wholesalers also positioned me as a middleman, thus sharpening my entrepreneurship skills,” noted one of Kayonza District’s model businessman.
He operated the shop until 1994 when he joined the liberation struggle.
After serving in military for nearly 10 years, he retired granting him an opportunity to go back into business.
“I started with only Rwf200,000,” he said, adding that he wanted to expand business but lacked sufficient funds.
Nyagatare said he was inspired by government’s programme of Hanga Umurimo in 2002 to join rice growing.
“I realised it was the only way I could make a contribution and create employment opportunities for other Rwandans,” he said.
To raise enough capital for the project, Nyagatare sold the shop.
He said he started with one machine and was also working with a few rice farmers.
KCB Bank Rwanda comes to rescue
As time went on, Nyagatare planned to expand the project, but lacked enough funds. This challenge was addressed by KCB Bank Rwanda, which gave a Rwf100 million loan in 2012. He used the money to import more machines from India to open a modern rice processing plant.
“The deal with KCB was that I buy from rice farmers in the community, process and pay back after sale,” he said, adding that he also bought more land to expand the factory’s capacity.
“It is because of KCB Bank that I was able to expand the project and employ more people,” he added.
The entrepreneur also acquired another loan worth Rwf200 million for the project, and is grateful that the bank is supporting government’s development programmes.
He said his biggest challenge is low and unsustainable produce supply from farmers.
“We increased our production capacity, but getting constant supply of raw materials from farmers is still a huge challenge,” he said.
“Secondly, limited knowledge on rice varieties among farmers poses a challenge in terms of quality which often affects final pricing.”
According to Nyagatare, cheap rice imports are a big threat to local production.
“However, we are working with farmers and other government institutions to increase local production and raise awareness on the importance of consuming locally-processed rice,” said Nyagatare.
He said that most of the imported rice is costs less compared to that produced locally, making it hard for local producers to compete. The high cost of production is also affecting his business, and called on the government to give farmers and processors incentives to make the sub-sector more profitable and sustainable.
From street vending, Nyagatare is, not only a well-established rice producer, but has also invested heavily into hospitality sector. He owns East Land and Silent hotels in Kayonza and employs more than 1,000 workers, thanks to rice production and KCB Bank support.
He has also ventured in cattle rearing and earns millions from milk production. He also has five trucks to help him transport rice from farmers to the processing plant.
Despite the achievements, Nyagatare is planning to start exporting his rice brand to regional markets.
“We have no choice but to export our products to other markets to support efforts aimed at reducing the country’s trade deficit,” he said.
How to profit from rice production
Rice has become a major cash and food crop in Rwanda.
Nyagatare said farmers and dealers can profit from rice business by ensuring accurate cost production analysis along value chain.
They must understand and always estimate profit per unit product at each stage on the value chain to be able to minimise loses, he added.
He advised farmers to embrace value addition to earn more from their efforts.