ETHIOPIA – Biftu Baha Oromia Share Company, a specialty in marketing agricultural products has started construction of a grain processing plant in the Dire Dawa Industrial Park in the east of the country.
At a total cost of 250 million birr (US$4.5 million), the new factory will house production lines for the manufacture of wheat flour and pasta.
According to news relayed by local media, the factory is expected to be completed by the end of this year and will create direct jobs for 100 people.
Biftu Baha has already secured the land and has completed the design and market feasibility study.
In Ethiopia, wheat is the second cereal cultivated after corn. While production in the country is one of the highest on the continent, the processing segment is still struggling to meet domestic demand.
By 2020, the Ethiopian Milling Association (EMA) reported that its affiliate members were operating at only 20% to 30% of their installed capacities because of wheat shortages, with the average national milling capacity estimated at 50%.
The shortages, according to EMA are partly attributed to rising demand fueled by an increase in population (which stands at 107 million people), urbanization, and increasing incomes.
In addition, EMA blamed the subsidized wheat imports that made the locally produced crop slightly expensive and weakened the country’s milling industry.
However, the country has been making strides toward achieving wheat sufficiency. The country plans to become wheat self-sufficient and net exporter by 2025/26.
Recently, the African Development Bank Group (AfDB) awarded grant funding worth US$84.3M for the implementation of Ethiopia’s Climate Resilient Wheat Value Chain Development Project (CREW) aimed to advance wheat production.
Resonating with the country’s agenda, the new company has established a working relationship with farmers to support the supply of production inputs to the factory.
The company also revealed that it is collaborating with Dire Dawa University, which will enable them to carry out competitive and winning activities supported by knowledge and research.