A big step forward for Gambia
Oct. 15, 2013
by Meyer Sosland
Recently, Africa’s smallest nation in terms of land area undertook an important step along the path to greater food independence. On July 1, an official inauguration took place for Gambia’s first flour mill. The flour mill was built in Banjul — Gambia’s capital city, economic center and home to the country’s most important port. Geographically, Gambia is a peninsula within Senegal with an Eastern coastline along the North Atlantic Ocean. The nation is made up of the Gambia River, its floodplain and river valley. In July 2013, the population of Gambia was estimated at 1,883,051.
The 300-tonne-per-day flour mill is part of the Gambia Milling Corporation (GMC), which is owned by a group of investors including Merriam, Kansas, U.S.-based Seaboard Corp., and Premier Investment Group. This is Seaboard’s first investment in Gambia, but Premier Investment has experience in this market. GMC will be operating as a joint venture with Seaboard responsible for technical support and grain supply.
Agriculture plays an important role in Gambia’s economy as it accounts for almost a quarter (22.3%) of the nation’s Gross Domestic Product (GDP), and three quarters of Gambia’s workers make their livelihood from the agricultural sector.
Gambia is not rich in natural resource deposits and has a limited agricultural base. The agricultural sector has untapped potential — less than half of arable land is cultivated. The economy relies in part on remittances from workers overseas and tourist receipts.
An exclamation point to the importance of the July 1 celebration was the attendance at the inauguration by His Excellency Dr. Yahya Jammeh, the President of the Gambia. Members of the global grain and milling industry were also in attendance to inaugurate Gambia’s first commercial flour mill.
“I am informed that the mill is established with an investment outlay of $17 million and has a capacity of 300 tonnes per day and will create job opportunities for over 300 Gambians,” His Excellency President Jammeh said at the inauguration. “Over the years, I have been talking about Africa moving away from export of raw materials to value addition, and this investment has exactly answered to this call. As a result, I have learned that the project will help to save the Gambian economy millions of U.S. dollars per annum in foreign exchange that would have been spent in the purchase of imported flour.”
Also in attendance at the inauguration were: Vice-President Aja Dr. Isatou Njie-Saidy; Chief Justice Joseph Wowo; National Assembly Speaker Honorable Abdoulie Bojang; cabinet ministers, members of the diplomatic and consular corps, senior dignitaries, management and staff of Seaboard Corporation, management and staff of GMC and a cross-section of the community.
The GMC mill is the end product of the efforts of people across several continents working together toward a common goal. Padova, Italy-based Mill Service S.p.A. was responsible for the mill equipment supply, local contractors did the civil engineering and the equipment was manufactured by Corum, Turkey-based Alapala Machine Industry & Trade Inc. Co.
The flour mill is located approximately 1 kilometer from the Port of Banjul and is a modern, 3-level milling facility that includes a mill building, flour warehouse, a well-equipped laboratory and 15,000 tonnes of grain storage space.
The plant is a traditional mill with automation, a cleaning house with a capacity of 15 tph, a milling house with a 300-tonne-per-day capacity and pelleting line. The mill section of the facility features three 8-section sifters, 13 roller mills and 1 double-high roller mill.
Due to the area’s high water table, special attention was paid to the three-story facility’s foundation. The first level of the facility is concrete and the other two are a metallic structure.
Mill Services was awarded the contract in 2010 to supply the 300-tonne-per-day flour mill. The plant was delivered on site in early 2011 and erection started in February/March of 2012.
“Total construction time stem to stern was about two years, although we only became involved about a year into the project,” Dave Dannov, Seaboard chief executive officer for Seaboard Overseas & Trading Group, Seaboard’s grain trading, transportation and processing division, told World Grain in a recent interview.
The facility was built with the capacity to be expanded. Whether or not expansion occurs depends on the demand from the domestic and export markets.
The establishment of the Banjul flour milling facility is seen to have a number of positive outcomes. It helps Gambia become more self-sufficient and increase its trade.
“This national milieu is what investors require to have a prosperous and secure investment. The sincerity and honesty of the Gambian people is also an essential goodwill indispensable to business success. The strategic position of the country as the Gateway to West Africa provides a strong platform to explore the huge market potential within the West African sub-region and beyond,” His Excellency President Jammeh explained.
“My government is always willing to go the extra mile to support investments that are in the interest of the Gambian people and in line with our national development agenda. I am convinced that this project, which is one of the biggest investments in Gambia, by the private sector, meets these expectations.”
Previously, all of the flour in Gambia was imported, primarily from Europe and Turkey. Seaboard said it expects to bring in a combination of French and U.S. HRW grains to the Banjul facility.
“This project is industrial but is also an agricultural investment, because it will lead to excellent quality flour, food security and food self-sufficiency, high potential foreign exchange attraction through export, employment opportunities and an animal feed mill to produce sufficient quantities of feed for cattle and poultry in Gambia and the sub-region,” GMC Chairman Mohamed Bazzi added at the inauguration. “This will also encourage investment in cattle and poultry farms leading to food self-sufficiency.”
His Excellency President Jammeh encouraged GMC to consider implementing the animal feed mill, the second phase of the project, as soon as possible. He said that will cater for the huge demand in the market and the potential to open up other sectors and activities. The planned animal feed mill will require large quantities of corn and this will encourage corn farming. GMC is also set to develop a big storage facility for all types of grains at the port’s former Navy base by 2014.
“Our appreciation goes out especially to our partners, Seaboard, for all their support, know-how and vast experience in running many flour mills in Africa and around the world. We thank them for coming on board with us and for sharing our strong belief in investing in this country under the leadership and vision of Your Excellency,” Bazzi said.
This investment is seen as an excellent strategic move for Seaboard and the other investors. “From a Seaboard standpoint, it will nicely add to our West African supply logistics,” Dannov said. “From a local standpoint, it is about food security, employment, creation and agricultural development.
“Our biggest challenge will be imported flour from countries that currently have structures that promote export through internal subsidies and convincing the baker base to change from their existing supplier sources. This will be achieved through competitive pricing and superior quality.”
This move also gives Seaboard the opportunity to take advantage of its existing logistics capabilities and regional assets already in place.
“We are excited about the logistics as Seaboard already owns bulk vessels and is delivering wheat constantly to its other milling affiliates in West Africa along with our third-party customers,” Dannov said.
The Banjul flour mill is set to sell premium quality flour under the name “Arch Flour” brand, while the mill feed and finished feeds will be under the brand name “GamFeeds.”
Seaboard sees a number of strategic growth points in the Banjul facility.
“Initially, the facility will mill only wheat flour, but eventually we will add feed manufacturing as there is good opportunity to develop a more formal feed input market, which right now is very unsophisticated,” Dannov said.
Gambia’s Trade Ministry put the nation’s 2012 flour imports at 65,000 tonnes. The mill has more than enough capacity to meet this demand.
“We expect the market to grow, particularly with a local milling industry and other regional links,” Dannov said.
The flour mill will work with the businesses that have been importing flour in Gambia. Those importers will be canvassed to become distributors for the Banjul flour mill. The former importers will then sell the flour directly to bakeries, hotels and their other customers.
“We intend to capture 100% of the market except for possibly some retail small pack at the very high end of the market,” Dannov said.
Rice and bread are the staples for carbohydrates in the typical Gambian diet. Dannov sees Gambia’s bakeries becoming more sophisticated as the industry grows.