Ethiopia: Malteries Soufflet to build 60,000 t malting

Malteries Soufflet, one of the largest malting groups in the world, is building a 60,000 t malting on the outskirts of Ethiopia’s capital Addis-Ababa. The company today signed a long term leasing agreement with the Industrial Parks Development Corporation (IPDC), an infrastructure provider, which was set up by the Ethiopian Government to realize the national industrialization agenda.

The malting, which is Soufflet’s first malthouse in Africa and will cost about US$50 million, is scheduled to start production in 2020. “Since 2016, the Group has been committed to developing a wide-ranging project in Ethiopia which includes an agricultural programme and building a local malt plant. Two people are already there full time and supporting local producers,” the company said in a press statement. “This year, the Group is also set to begin buying barley commercially directly from producers.”

Ethiopia produces two million tons of barley for human and animal consumption, more than any other country in Africa. Currently there are two malt factories in the country, Assela Malt Factory and Gondar Malt Factory, providing a total of 52,000 tons of malt for domestic breweries, which is about 30% of the total demand.

Early last year French agro-cooperative Axéréal and its malting division Boortmalt already announced to build a new 60,000 t malting in Ethiopia, the company’s first outside of Europe. Production was said to start by the end of 2018. (inside.beer, 8.2.2017)

With a population of almost 100 million, Ethiopia is growing fast, from both the demographic and economic points of view. Ethiopia is also Africa’s 4th largest beer producer with a total production of 12 million hectoliters per year. Still, the potential to row is enormous since per capita consumption amounts to only 9 liters per head and year.

“Ethiopia is an attractive country to invest in because of its vast, yet largely untapped potential,” stated Christophe Passelande, CEO of Malteries Soufflet, “The country’s barley production capacity, the malt demand growth, coupled with Soufflet’s extensive international experience, promises a successful collaboration.”

Groupe Castel was the first foreign brewing group to enter the market in 1998. Before the privatization in 2011 Castel’s local arm BGI Ethiopia, had a market share of about 70 percent. Since the privatization, the Ethiopian beer industry has attracted a lot of foreign money. Heineken and Diageo entered the Ethiopian market in 2011 following the acquisition of old and tittering state-owned breweries in the country.

In 2017 Ethiopia had seven breweries operating a total of 11 breweries in the country. BGI Ethiopia was by far the biggest with a38% market share followed by Heineken Ethiopia (30%), and Diageo (15%). Other smaller breweries include Dashen Brewery (13% market share), Raya Brewery, Habesha Brewery (70% owned by Bavaria Holland), and Zebidar Brewery . (inside.beer, 17.8.2017)

Earlier this year BGI Ethiopia increased its leadership by buying a 58% stake in Raya Brewery and another 58% stake in Zebidar Brewery (inside.beer, 10.4.2018), which leaves only five independ brewing groups in Ethiopia.

 

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