NB boosts agric with backward integration

The commitment of Nigerian Breweries Plc to the Federal Government’s Backward Integration Policy (BIP) has significantly impacted the agric sector, particularly operators in the cassava and sorghum value chains.

According to the company’s Managing Director, Mr. Nicolaas Vervelde, the brewery giant’s BIP, which substitutes imported raw and packaging materials with local alternatives, has so far engaged about 60,000 farmers in the cultivation of sorghum alone.

Vervelde, who spoke at a briefing in Lagos, ahead of its Annual General Meeting (AGM), said 48 per cent of the company’s raw materials are sourced locally, but it targets to achieve 60 per cent local raw material sourcing by 2020.

“All our labels and crowns are sourced locally,” Vervelde said, adding that the company’s aggressive investments in the cassava and sorghum value chain will help it achieve the 60 per cent target by 2020.

He said apart from strategic interventions in the agric sector by making quality, high-yielding seeds available to farmers, the company has stepped up its investment in Research and Development (R&D) in sorghum and cassava value chains.

Vervelde said the company’s involvement in cassava has created several jobs for farmers engaged in extracting cassava starch, which is processed into maltose syrup.

Vervelde further said Nigerian Breweries, last year, signed a Memorandum of Understanding (MoU) with the Federal Ministry of Agriculture and Rural Development (FMARD) to develop and commercialise hybrid sorghum.

It also signed a tripartite partnership agreement with International Fertiliser Development Centre (IFDC) and Psaltry International Limited, a Nigerian cassava processing company, on value extraction of maltose syrup derived from cassava for the company’s production.

Vervelde said the partnerships were aimed at improving agribusiness for Nigerian smallholder farmers and optimising the cassava value chain.

According to him, local sourcing of raw materials creates shared value for the company and its stakeholders. Apart from guaranteeing sustainable supply of materials for the business, reducing dependence on imports, it encourages costs and improves the company’s environmental performance.

The MD reaffirmed the company’s commitment to the Federal Government’s BIP and to the growth and development of the nation’s economy, despite the challenging operating environment.

He said, for instance, that the macro-economic environment in 2016 was challenging, as scarcity of Foreign Exchange (forex), rising input prices due to the devaluation of the naira and rising inflation put consumer purchasing power under severe pressure.

He, however, said that the company was able to weather the storm and end the year with a positive result and deliver good return on investment to its shareholders. Vervelde attributed the feat to the company’s twin agenda of Cost Leadership and Market Leadership supported by innovation.
Credit: The Nation Online