Kenya based edible oils manufacturer Bidco Africa has partnered with American conglomerate Land O’Lakes to invest Sh1.2 billion in the upgrade of an animal feed factory in Nakuru in a bid to curb the rising shortage of quality and quantity feeds pushing farmers’ cost of production high.
Currently in Kenya, the annual demand for fodder is estimated at 30 million MT against an actual production of 10 million MT in 2016; whereas, demand for manufactured feed and supplements estimated at about 700,000 MT in 2016 up from 300,000 MT in 2008, according to Feb 2019 Draft National Livestock Policy by the Ministry of Agriculture, Livestock, Fisheries and Irrigation State Department for Livestock.
The total installed feed production capacity is about 1,000,000 tons, of which approximately 60 percent is utilized.
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The Bidco Africa- Land O’Lakes venture expects the plant to have a processing capacity of 28 tonnes per hour, a move that will raise competition in the industry against existing players such as Unga Group.
However, actors in the fodder value chain have formed informal organizations to promote growth and development of forages.
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Currently, licensed feed manufacturers in Kenya account for approximately 60 per cent of the demand while unregistered small scale manufacturers, home-based feed formulators and importers account for the balance.
The underutilization is due to the inadequate and unreliable quantity of raw materials/feed ingredients, level of use of commercial feeds and in some cases, farmers’ preferring to produce their own feed on their farms. Some challenges facing the animal feeds industry in Kenya include erratic supply of raw materials and low-quality ingredients.
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Land O’Lakes is based in Minnesota and produces animal feed, dairy products and crop seed. The multinational, which is owned by farmers, reported net sales and net earnings of $15 billion (Sh1.5 trillion) and $255 million (Sh26.1 billion) respectively in the year ended December 2018. “The plant is fully automated to ensure accuracy in production and reduce the chance of human error,” Chris Diaz, a director of Bidco, said.
“This will enable us introduce four products, Pro Calf Starter, Pro Heifer Developer, Pig Starter 4-4-4 and Pro Calf Milk replacer into the Kenyan market.” The plant incorporates new technology to test every load of ingredients for quality (aiming for zero aflatoxins or other harmful elements) while ensuring the right mix of nutritional elements, the company said.
“We are working with 30,000 farmers who supply us with maize, sunflower and soya seeds for processing of oil products,” Mr Diaz said.
“Once this is extracted, the soya cake, maize germ and sunflower cakes will be used in creating new animal feed products that will be fortified to suit different livestock nutritional needs.”
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Bidco, with a presence in 18 African markets said the new products will supplement Bidco Feeds brands that are processed at their Thika-based feed mill which has a capacity to process 48,000 tonnes a year.