October 01, 1998
by Teresa Acklin
Trinidad and Tobago's only flour mill serves a growing ethnic population.
By Stormy Wylie, Editor
It is July, 1498. Columbus is on his third voyage to the Americas, but this time he is forced to take a more southerly route to avoid a hostile French fleet. It has been a difficult crossing. Drifting in the heat of the equator, faced with rotting food and one last casket of water, Columbus sights an island. He names it La Trinity, for the Blessed Trinity, and claims the island for Spain.
Five hundred years later, the anniversary of Columbus' “discovery” was barely acknowledged in the Caribbean nation of Trinidad and Tobago. Many Trinidadians flinch at the suggestion that the country's history begins with the arrival of the Europeans.
“The general acceptance is that there were people here before Columbus,” said Reginald Bacchus, general manager of manufacturing of the country's only flour mill, National Flour Mills Ltd., located in Port-of-Spain, Trinidad.
Trinidad and Tobago are the southernmost islands in the Caribbean chain, only seven miles off the coast of Venezuela and geographically a part of South America. The islands' indigenous people, the Carib and the Arawak Indian tribes of South America, once numbered 35,000 in pre-Columbus times. But war, enslavement and disease brought by the outsiders reduced that number to where only a few hundred remain, historians note.
Today, a mixture of many races and cultures make up Trinidad and Tobago's population of 1.3 million persons. About 40% are of African descent, their ancestors brought to the island as slaves to work on the sugar plantations. Another 40% can trace their roots to India, whose ancestors came to Trinidad as indentured servants. Still others claim heritage to Europe, South America, the Mediterranean, the Middle East and China.
This ethnic and cultural diversity is a source of pride for the small Caribbean nation. “Trinidad is a place where the clashes of history and the accidents of geography have created a diversity that is almost unrivaled,” says one tourism brochure.
The food in Trinidad and Tobago is as diverse as its population. Many favorite ethnic dishes are flour-based, such as roti, an Indian bread that is cooked on a hot griddle. It can be filled with dhal (split peas) or stuffed with curried meats and vegetables. When roti is broken up into loosely shredded pieces and mixed with vegetables and meat, it called paratha or “buss-up-shut.”
Another popular ethnic dish is the African-based “bake,” an unleavened bread that is eaten with buljol, a mixture of shredded saltfish, onions, tomatoes, avocado, pepper and salad oil.
Two foods that can be found on nearly every street corner in Trinidad are ham-and-hops, a crisp bread roll filled with ham, and “doubles,” curried chana (chick peas) between two pieces of bara, or fried dough.
Because of the popularity of these dishes, there is a strong retail market for flour in Trinidad, according to Mr. Bacchus. Domestic consumption accounts for about 85% of all flour production at N.F.M. However, exports are growing, especially to other nations in the Caribbean community, and are expected to be the main source of growth as many local market sectors are saturated, he said.
In 1996, N.F.M. produced 91,000 tonnes of flour and flour sales jumped nearly 38% in 1996 over 1995. In 1997, both production and sales volumes grew by 4%. “Most of the flour we produce is used by bakeries and the retail trade,” Mr. Bacchus said in an interview with World Grain in September.
In addition to bulk flour, N.F.M. packages flour and edible oil under its own brand names, including “Good ‘N' Natural,” “Lotus” and “IBIS,” and for private labels. The company also has formulated flours specifically for baking crackers and cookies.
Consumer-ready and convenience foods are in great demand by a well-established and growing middle class in Trinidad and Tobago, according to reports from the U.S. diplomatic attache. The country also has a growing restaurant sector. “Trinidad has a sophisticated distribution system and modern supermarkets, which facilitate retail sales and marketing,” the attache said. “Trinidadian popular culture exhibits a notable ‘joie de vivre,' valuing the enjoyment of life, which spills over to the food Trinidadians eat and high consumer spending.”
With an economy based largely on oil and gas, Trinidad and Tobago has one of the highest per capita incomes in the hemisphere. The country's gross domestic product has exhibited three consecutive years of real growth of 3.1%, 2.8% and 2.9%, respectively, over the 1995-97 period. Projected growth for 1998 is approximately 3%. Average GDP growth over five years has been 3.4%.
Because domestic agriculture is limited to sugar cane and cocoa, Trinidad and Tobago is dependent on agricultural and food imports, and there are few trade restrictions. The government recently embarked on a program to diversify its economy to make it less dependent on oil, according to the U.S. attache. There is a push to improve the country's tourism sector, and a major part of Trinidad's diversification policy has included liberalizing import policies, the attache said.
Food imports totaled U.S.$221 million in 1996, which represented 13% of all imports. The U.S. supplied about 58% of those imports, largely because of a geographic advantage and “ongoing, good relations” between the two countries, according to the attache.
Trinidad's main agricultural imports include grains, oilseeds, dairy products, fruits and vegetables. The U.S. is the largest supplier of grains and oilseeds.
U.S. wheat is primarily used at the country's single flour mill, National Flour Mills, including dark northern spring, soft red winter and hard red winter wheat varieties, according to Mr. Bacchus. Some Canadian wheat is occasionally purchased, he said.
Although Trinidad and Tobago is geographically closest to South America, N.F.M. rarely purchases South American wheat, Mr. Bacchus said. “We bring in vessels with tonnages of up to 30,000 tonnes from the United States every three weeks, stacked with all grains wheat, soybeans, corn and rice,” Mr. Bacchus said. “That is logistically difficult to arrange in South America.”
A wheat sample is analyzed prior to the vessel's arrival, he said. The grain also is inspected by quality assurance workers before being discharged from the ship and transferred to storage silos. N.F.M.'s total silo capacity is about 68,000 tonnes.
The stored grain is then distributed, on demand, to wheat holding bins dedicated to each of the two 220-tonne (per 24 hours) mills. The grain is drawn from these bins weighed, cleaned and tempered, Mr. Bacchus said. The moistened grain is allowed to rest for 20 to 24 hours on the A mill and for eight to 12 hours on the B mill before being milled, he said.
In the milling process, the clean, tempered grain is crushed, sifted and purified. The flour, which is tested every two hours, is transferred to storage bins, blended and distributed to the 2-, 10- and 45-kilogram packers and bulk trucks. A Compuweigh yield management system is used in the milling process to continuously monitor the mills' extractions, which averages 74% on each unit, Mr. Bacchus said.
Apart from flour, the mills also produce cracked wheat, fine bran, coarse bran, semolina and wheat germ.
The mill added a flour blending system in 1996. “We now have the ability to blend wheat and flour,” Mr. Bacchus said. “The blending of flour also facilitated longer mill runs, resulting in the overall improvement in the efficiency of the plant. Better moisture control, improved extractions, protein recovery, ash levels and less spillages also resulted in an overall improvement in plant sanitation.”
Because the flour mill was built three decades ago, the equipment is a mixture of many major manufacturers. The company uses Henry Simon rollermills, Great Western sifters and Buhler purifiers as well as Fawema, Buhler and Swiss Industrial flour packers. Its storage and elevator operations include a Buhler grain conveying system, a Neuero pneumatic ship unloading system and concrete and steel storage silos.
“We are constantly upgrading,” Mr. Bacchus said. “Our capacity has doubled from what it was 30 years ago and we continue to look at ways of upgrading and expanding in order to satisfy the total market needs.”
Diversity in all forms is the key to N.F.M.'s growth, Mr. Bacchus said. “We are more than just flour,” he added.
The company was established in 1966 as Trinidad Flour Mills Ltd., a joint venture between two U.S. companies The Pillsbury Co. and the former Garvey Grain Co. and local business interests in Trinidad. In September 1972, a newly incorporated company, National Flour Mills Ltd., was established by the government of Trinidad and Tobago to acquire the assets of Trinidad Flour Mills. The government held a 52% majority interest and its partners, Maple Leaf Ltd., a Canadian corporation, and Intercontinental Grain Co. Ltd., a former U.S. grain company, held a 36% and 12% interest, respectively. In 1980, the government bought out the foreign investors' shares and N.F.M. became a wholly owned state enterprise.
During the next decade, N.F.M. began to diversify its operations. It acquired the Trinidad Grain Terminal, which sold bulk corn and soybean meal to animal feed producers; took over operations of National Feed Mill Ltd., which manufactures animal, poultry and specialty feeds; took over local rice milling operations; and built an integrated soybean complex to produce edible oils.
On-site storage capacity was increased in the early 1990s and a new ship loading/unloading facility was built in 1994.
In the mid-1990s, when the government of Trinidad and Tobago made the decision to diversify its economy, it also decided to sell off its interests in many state enterprises. “In the 1960s and early 70s, it was popular for government to buy up local businesses,” Mr. Bacchus said. “We're seeing a reversal of that, mostly as a result of global competition.”
Today, N.F.M. is a public company quoted on the stock exchange. The government is the majority shareholder, with a 51% shareholding. The other 49% have been divested over three tranches beginning in June 1995.
There are nearly 9,000 shareholders, the largest being the Trindad and Tobago Unit Trust Corp., a financial house owned by the state to handle investments; the National Insurance Board; and some large banks. The rest is spread among the citizens.
Michael Potella, N.F.M.'s chief executive officer, said the public had demonstrated “tremendous confidence in the company, with each share offering being overwhelmingly over-subscribed by as much as three times in some instances.” He said the government of Trinidad and Tobago also had signaled its intention to divest even more of its holdings in N.F.M.
“The shares have performed exceptionally well over the period, with its value increasing three-fold since the initial tranche,” Mr. Potella said. A bonus also has been issued to shareholders, he said.
“It is true to say that the company has allayed the fears and concerns of many who doubted its ability to perform and survive in a totally liberalized environment,” Mr. Potella said.
The company has embraced the philosophy of Total Quality Management, he said, and obtained ISO 9002 certification in 1997. Training also is an integral part of the company's development, Mr. Potella said. N.F.M.'s technical and quality assurance workers are involved in the Association of Operative Millers and the American Oil Chemists' Society.
According to the company's 1997 annual report, N.F.M.'s sales last year were down slightly to $666 million, compared with U.S.$723 million in 1996, because of a decrease in flour prices. Net income in 1997 was U.S.$2.1 million, off dramatically from U.S.$21 million in 1996 largely because of a U.S.$28.5-million loss surrounding two ill-fated shipments of rice, the company said. But the outlook for future growth is strong.
“The company's balance sheet remains rock solid and its cash flows are healthy,” the company said in its annual report.
The domestic market became more competitive in 1997, the company said, adding that its growth was in flour operations. Exports of flour and rice grew nearly 13% in 1997. The company said it had retained its leadership position in all market segments, even in the face of significantly increased competitive activity from foreign imports.
N.F.M. restructured its workforce in 1997, offering voluntary separation and early retirement to about 107 workers. Mr. Potella said the restructuring would not only result in “meaningful savings over the medium to long term, but perhaps more importantly, provides an opportunity for a new culture to be infused into our company a culture more in keeping with the economic climate in which we operate.”
Mr. Bacchus predicted that the “diversification thrust” would continue in the coming years at National Flour Mills. A new U.S.$30-million feed mill is nearly finished and a feasibility study has been commissioned for a new flour mill, he said. Other future projects on the drawing board include margarine production and an integrated durum and pasta plant.
“Diversification gives you more opportunities and makes you less vulnerable than a single-product company,” he said. “It brings growth in turnover and profit margins and will make us more competitive globally.”