Flour Mills shows confidence in Nigerian economy despite uncertainty
At a point investors are maintaining caution, Flour Mills of Nigeria (FMN) Plc is showing confidence in the Nigerian economy through its consistent investments and long-term plans.
FMN, which started in 1960, is a well diversified group, playing in industries such as wheat-milling, noodles and pasta, sugar, feed mills, fertilizer, rice, palm oil, packaging and transport. Wheat-milling forms the financial bone of FMN Group.
The FMN’s sugar subsidiary known as Golden Sugar Estate Limited is investing $300 million in sugar production in the country. Its site in Sunti, Niger State, is seen as one of the fastest growing projects in the country.
At the 2016 annual general meeting held in September 2016, John G. Coumantaros, chairman of Flour Mills Group, said the first phase of the group’s investment in local sugar production would produce over 100,000 metric tonnes (MT) of sugar, create over 15,000 new jobs, and generate 10 mega watts (MW) of excess electricity from cane fibres.
According to Coumantaros, there would also be animal feeds and fertilizer from the sugar molasses by-products, adding that this would save over $50 million in foreign exchange for Nigeria, annually.
“The 16,000 hectares of irrigable land on the banks of the Niger River and the modern designed 4,500 ton of cane per day mill form one of the largest agro-allied investments in Nigeria and gives substance to government’s efforts to reduce dependence on imported sugar,” said Flour Mills chairman.
Real Sector Watch gathered that the conglomerate’s Agri Palm Limited has plantations at Ugbogui and Iguiye near Benin City in Edo State, and has expanded to 4,000 hectares (ha) of established palm in the first phase of local palm oil production needed to support the upstream needs of the group’s oil refining operations in Ibadan.
In 2016, the FMN acquired 20,000 hectares of land for future developments, giving Agri Palm the potential to be one of the largest oil palm plantations in Nigeria.
Despite being a market leader in wheat, the group is also ranked among the big shots in the feed milling industry.
One year preceding September 2016, Premier Feed Mills, a subsidiary of the FMN, sold over 400,000 tons of animal feed for the first time in history, surpassing the prior year sales by 25 percent, representing the largest single company sales in Nigeria.
The group announced it was installing a sorghum kilning and milling process at its Kano mills, having modified the silo facility in preparation to receive locally grown wheat. He further said a decision had been taken to add a sorghum kilning and milling process in Kano.
Flour Mills has metamorphosed into one of the most diversified businesses in Nigeria, having subsidiaries such as Golden Sugar, Agro Allied Farms Sunti Limited, Agri Syrups Limited (Shao Farm) and Thai Farm International Limited, Agri Palm Limited, and Rom Oil Mills Limited. Others include Premier Feed Mills, Kaboji Farms, Golden Fertilizer and Golden Agri Inputs, Bagco, Golden Transport & Logistics, and Apapa Bulk Terminal Limited.
To optimise cost, the FMN dissolved and de-registered six dormant subsidiaries as part of its restructuring and rationalisation initiatives.
The six subsidiaries are Pure Oil Mills Limited, Western Cement Limited, Burham Cement Limited, FMN Agro Allied Ventures Nigeria Limited, Southern Star Shipping Company Nigeria Limited, and Sovereign Foods Limited.
ODINAKA ANUDU