Olam steps up Nigeria milling business with $150 million investment

Olam aims to cement its wheat milling stature in Nigeria.

The agribusiness company is stepping up its wheat milling business in Nigeria as it invests $150 million to set up two animal feed mills, poultry breeding farms, and a hatchery in the country.

According to the Oversea-Chinese Banking Corporation (OCBC), Olam’s projects would be the largest of their kind in Nigeria. Olam intends to utilize the wheat bran from its wheat milling operations, as well as maximize its sourcing networks to buy corn and soy from local farmers.

“Recall earlier that Olam spent $275 million to acquire Amber Foods which owns the wheat milling and pasta manufacturing assets of the BUA Group in Nigeria – a move to strengthen its position as the number two wheat miller by sales volume there,” OCBC said.

“… moving downstream makes sense as it will create “demand” for its upstream origination business. However, any sizable benefits are likely to accrue from FY17 onwards at the earliest,” OCBC added.

Source: Singapore Business Review | Business, Economic, Finance, Stocks News