12 April 2018 – In late-March Royal Agrifirm Group announced a joint venture with Algeria’s Diam Grain to construct a new premix plant in Blida, near Algiers. Agrifirm and Diam Grain will aim to offer high quality nutritional solutions for the expanding Algerian animal nutrition market. The joint venture will also benefit from new laboratory facilities. And a lot of focus will be placed on nutritional and farm management support for customers.
Established in 2007, Rouïba-based Diam Grain is currently a leader in the domestic animal nutrition market. Diam Grain employs approximately 300 people. The collaboration will build on a long-standing business relationship between both parties and will expand Agrifirm’s reach in Algeria, which has been an important target for the firm’s exports for many years.
“Combining the commercial strength and vision of our partner with our know-how is a guarantee for a successful growth in this dynamic and expanding market”, said Filip Thyssen, Business Unit Director MEA of the Royal Agrifirm Group, when the announcement was made.
For our Algerian partner the technological and nutritional expertise of the Royal Agrifirm Group is essential for realizing the ambitious plans of taking animal nutrition in Algeria to the next level.
Agrifirm expects the new premix plant in Blida to be completed in 2019. In the meantime, the company will continue to deliver premixes to customers in Algeria from its factory in Belgium.
“The new Blida plant will be a state-of-the-art premix plant which combines our premix production experiences in South America, Europe and Asia”, Filip Thyssen told Feedinfo News Service. “The project will be able to deliver a substantial part of the premix market”.
Currently Agrifirm, under the Nuscience and Preconex brands, provides young animal nutrition concepts, mineral feeds and customized premixes, as well as functional feed ingredients. The company’s premixes in particular benefit from being well-established in the market for quite a few years already.
Being directly present in the Algerian market through the joint venture will according to Agrifirm, enable the company to serve its customers even better. The joint venture will provide much more flexibility for the market implementation of Agrifirm’s range of functional feed ingredients (including Aromabiotic®), mycotoxin deactivator product (Vitafix®) and antioxidant Vitanox® and tailor-made premixes.
“It is our vast belief that through these solutions, we will contribute to a sustainable and efficient animal production in Algeria”, Thyssen claimed.
The Blida plant will primarily focus on catering to demand in the Algerian market, but if opportunities arise in neighboring countries, Agrifirm said it will surely consider that option.
Commenting on the Algerian feed market itself, Thyssen said: “The Algerian feed market is the largest in the Maghreb and the 3rd largest in Africa. The premix market in theory is self-sufficient, but a part of it still lacks professionalism to some extent. However, things are changing fast in a positive way in this matter”.
In recent years Agrifirm has been one of the important players exporting premixes to Algeria.
“Up until about two years ago, about 40% of premixes were produced locally in Algeria and the other 60% were imported. At the same time, the poultry sector has been growing fast every year (with 15% noticed in 2015-2016), and the level of professionalization has increased too. The ruminant sector also grew, but the majority of projects are small scale”, commented Thyssen.
Agrifirm’s decision to build the new premix plant in Blida was made several months after a change in import rules into Algeria for premixes and mineral concentrates. These June-July 2017 import restrictions are seen to be part of a wider government initiative to use licensing measures to reduce imports and preserve Algeria’s foreign exchange reserves. Back then it was also suggested that the measures were expected to support the domestic premix industry.
Thyssen provided his view: “It is correct that since the drop in oil prices Algeria has been struggling with its foreign exchange reserves. This in spite of the fact that it is one of the few countries without public debt. Measures have been taken to limit hard currency export and limit importation of goods through import bans or special license systems. This has had effects across all industries”.
“We never stopped delivering premixes to Algeria but actual delivered quantities have not been reflecting our capacity recently. These measures, giving the local production some advantages, influenced the time of our decision”, he added.
And despite North Africa being considered by some foreign enterprises as a risky geographical zone for investment due to periods of unrest or tension, Agrifirm argues that Algeria’s exposure to the events some years ago was limited.
“We consider Algeria to be the most stable country in the region”, Thyssen said.
In any case, the collaboration with Diam Grain will help to further build Agrifirm’s resilience in the region.
“We have been cooperating with Diam Grain, its owner Mr. Omari and highly skilled staff for many years now. Diam Grain is a large player in the Algerian feed market, mainly by importing grains and soybean meal (top 3 player) and reselling premixes and feed additives”, said Thyssen. “Over the years, we learned to know Mr. Omari as a trustful man with the mission to bring the Algerian feed and animal production sector to a higher level, and in a sustainable way”.
Thyssen added: “Mr. Omari has consistently invested in people and projects in accordance with this mission. In addition to the premix project, he is for example also investing in the production of complete feed which is of course a pro for our joined project. Therefore we have a lot of confidence to step into this project with Diam Grain”.