Deal #7644

Location #1

Spatial accuracy level
Approximate location
Location
Burera, Rwanda

Target country
Rwanda
Comment on location
Located in the Northern Province, Burera District

Land area

Intended size (in ha)
0
Size under contract (leased or purchased area, in ha)
[2015] 0
Comment on land area
Pure contract Farming

Intention of investment

Intention of investment
Industry
Comment on intention of investment
In Burera, farmers kept cattle for the sale of calves, cows and manure. But few produced milk because they had no market. The government responded by investing in a community milk processing centre, now Burera Dairy Ltd. in Cyanika to stimulate demand.

Nature of the deal

Nature of the deal
Pure contract farming
Comment on nature of the deal
It serves around 25,000 cattle farmers in the Northern Province and processes milk to various products such as cheeses, yoghurt and fermented milk. Burera Dairy limited buy from the CEPTL cooperative milk collection centre next door to the dairy, that in turn buys from individual farmers via six community collection centres, paying the government-set price of RWF200 (US$0.23) per litre

Negotiation status

Negotiation status
[current] Concluded (Contract signed)

Implementation status

Implementation status
[current] Startup phase (no production)
Comment on implementation status
Operations are expected to begin in February with some products expected to hit the market thereafter.

Purchase price

Comment on purchase price
Sources say that the firm was sold at around Rwf 270 million (US$290,000). None of the parties involved agreed to disclose the figure.

Contract farming

Contract farming
Yes
Not on leased / purchased area (out-grower)
Yes
Not on leased / purchased farmers (out-grower)
[2018] 1035
Comment on contract farming
The company buys from the CEPTL cooperative milk collection centre next door to the dairy, that in turn buys from 1035 individual farmers via six community collection centres, paying the government-set price of RWF200 (US$0.23) per litre.

Operating company

Operating company
Name of investment project
Burera Community Processing Centre (CPC)
Comment on investment chain
African Solutions Private Ltd (Afrisol), a Zimbabwean firm which has been investing in Rwanda over the past two years, has bought off the 98.3% shareholding in Burera Diary Limited from the Rwanda Government.

 

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Data source #1

Data source type
Media report
File
Publication title
Rwandan government sells Burera Dairy Ltd to Zimbabwean investor Afrisol
Date
2020-01-15
Comment on data source
Rwandan government sells Burera Dairy Ltd to Zimbabwean investor Afrisol

Data source #2

Data source type
Media report
Publication title
Young Zimbabwean businessman buys dairy firm from Rwanda Government
Date
2020-01-15
Comment on data source
Young Zimbabwean businessman buys dairy firm from Rwanda Government

Data source #3

Data source type
Company sources
File
Publication title
DAIRY VALUE CHAIN niche

Data source #4

Data source type
Company sources
Publication title
Meaningful meetings mean more milk
Date
2018-09-20

Data source #5

Data source type
Media report
File
Publication title
Rwanda: Govt Sells Burera Dairy Ltd to Zimbabwean Investor
Date
2020-01-17
Comment on data source
Rwanda: Govt Sells Burera Dairy Ltd to Zimbabwean Investor

Promised benefits for local communities

Promised benefits for local communities
Capacity Building
Other
Comment on promised benefits for local communities
Afrisol have indicated that they intend to boost the milk-processing industry and buy milk from farmers, train them on best practices, as well as work with farmers in availing animal, feeds to boost productivity in both quality and quantity

Materialized benefits for local communities

Materialized benefits for local communities
Productive infrastructure (e.g. irrigation, tractors, machinery...)
Capacity Building
Other
Comment on materialized benefits for local communities
In 2016 there was only one community milk collection centre with a small output, and now there are six, producing in total, an average of 10,300 litres per day.

Detailed contract farming crop and animal information

Contract farming livestock
Dairy Cattle

Use of produce

Has domestic use
Yes
Has export
Yes

In country processing of produce

In country processing of produce
Yes
Comment on in country processing of produce
The plant have the daily capacity to process 10,000 liter of milk into various finished products such as soft and hard cheese, yogurt, long-life milk, butter, ice cream as well as fermented milk.
Processing facilities / production infrastructure of the project (e.g. oil mill, ethanol distillery, biomass power plant etc.)
Afrisol Chief Executive, Ruvimbo Chikwava said between Rwandan francs 1billion (US$1,06 million) and Rwandan francs 2 billion (US$2.1m), which will be invested over the next five years go into improving the capacity of the plant, repairing and revamping the plant, establishing new product lines, working capital as well as ensuring prompt payments to farmers.

Jan. 20, 2020, 3 p.m.

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