India’s Allanasons to Invest $20 Million in Ethiopian Meat Plant

Allanasons Ltd., an Indian food company, plans to invest $20 million in a meat-processing plant in Ethiopia as it seeks to take advantage of a large population of naturally fed cattle and sheep.

The Mumbai-based producer has been allotted land in Adami Tulu in Oromia region, about 170 kilometers (106 miles) south of the capital, Addis Ababa, where it will build a facility to produce 70 metric tons of meat products a day, said Aman Khan, head of Ethiopian operations.
“Ethiopia has the largest livestock population in Africa and the demand for meat proteins continues to increase globally, so we feel it is the right decision to invest in the livestock sector here,” he said in an e-mailed response to questions today. Allanasons is India’s largest exporter of processed food and commodities, according to its website.
The Horn of Africa nation’s estimated livestock population of 49 million cattle, 25 million sheep and almost 22 million goats directly contributes 15 percent to 17 percent of gross domestic product, according to the Ethiopian Agricultural Transformation Agency. Foreign sales earn about $150 million a year, or 10 percent of exports, and another $300 million of livestock may also be illegally exported, it said.

While veterinary and feeding practices should be improved in Ethiopia, the absence of growth hormones and antibiotics causing “major concern” for the industry is an advantage, Khan said. “The quality of meat of Ethiopian livestock should be considered good,” he said.
Officials need to address skilled labor shortages and poor transport infrastructure and cold chain systems to improve Ethiopia’s competitiveness, he said. “We feel that the government should consider supporting the meat industry in a more dynamic way considering the stiff competition,” Khan said.
http://www.businessweek.com