Monthly Archives: May 2019

African Dairy Sector

African Dairy Sector, The Next Big thing

When it comes to the future of Africa’s economy, its food, dairy and agri-processing sectors will be key drivers, a situation which is fuelled by a growing population.

By 2050, the global population will expand by 2.2 billion people, a UN report shows. Half of that growth will occur in Africa. Fact is that these people will need food to survive, dairy products included. This offers new business opportunities to food processors and their equipment suppliers.

The above facts were the main reason Resulta attended the Africa Food Manufacturing & Safety Summit (AFMASS) Eastern Africa last month. Taking place in Kenya, the event allowed participants to hear about, keep track of, and discuss relevant trends within Africa’s food manufacturing sector. Besides conference sessions and high-impact networking breaks, the gathering featured an expo, networking sessions and other relevant sub-events.

Significant growth

Resulta’s attendance predominantly focused on the region’s dairy, fruit, vegetable, and food processing sub-sectors. “Considering an expanding population and increasing spending power, these are just a few industries that will experience significant growth over the next few years,” says managing director Eric Juncker.

This growth is already happening. Last month, RaboResearch dairy analyst Matthew Johnson described Sub-Saharan Africa as an “increasingly recognised as the next frontier for the global dairy industry” whilst the World Bank has hailed Africa’s food and agri-processing sector as an untapped opportunity.

East Africa’s potential

Whilst Kenya is not Resulta’s top market yet, the country and the entire East African region is growing in terms of significance, Juncker says. “There is a lot of potential for growth, particularly in the dairy industry. In due course, we want East Africa to become our second most important business region,” he explains, noting that attending the AFMASS will help the company work towards that goal.

“Besides meeting with existing clients, we connected and discussed our process engineering equipment and solutions with over 120 company representatives who didn’t know about us before-hand. From my discussions with these company representatives, I discovered that there is a large gap in terms of equipment dealing with water treatment and cooling as well as modular dairy processing solutions,” Juncker says, noting that Resulta has a long track-record of supplying quality dairy processing engineering equipment in Africa, from conveyors and stainless steel tanks to modular water cooling systems. “We have been working in Africa for at least 30 years, dealing with a variety of companies in over 25 countries, from the DRC, Ghana and Nigeria to Kenya, Ethiopia and Ivory Coast.”

Resulta is a consulting project engineering company in South Africa that supplies quality process engineering equipment, components, and other machinery to dairy companies, food manufacturers, and processors across the African continent. We serve companies in various industries, from edible oils and palm sector to dairy, fruit & vegetables, and agro-processing. Our competitive edge lies in our ability to customise all design elements of our process engineering equipment, allowing to meet our customers’ very specific and ever-changing needs time and time again. This is amplified by a personalised service, on-site meetings (on our account) and detailed dialogue prior to tendering.

Client Conference

In April 2018, Resulta Exporters hosted a dozen clients from Africa and Europe at its offices in Stellenbosch. The 5-day gathering featured a one-day conference, factory tours, and a meet and greet with the team and partner PROFEA.

The aim: connecting with clients on a face-to-face basis, showcasing Resulta’s latest projects, and providing delegates with the opportunity to sit with management and discuss their process engineering machinery and stainless steel engineering equipment requirements on a face-to-face basis.

“Organising these annual events, which we have been doing for a number of years, are valuable for us and our clients. They allow us to truly connect with one another, helping us to understand our clients’ needs better and solve their engineering problems more efficiently,” says Resulta’s Managing Director Eric Juncker.

Personal client approach

He notes that these face-to-face discussions are much more efficient than having those same discussions via email or the phone. “We live in a time in which we can do everything via the internet. Resulta nevertheless continues to believe in the importance of engaging with our clients on a personal, face-to-face level. There is only so much you can convey via email,” Juncker says.

“That is we have made a habit of visiting prospecting clients on-site and anywhere in Africa at our own expense before tendering. This helps us to identify bottlenecks and evaluate any engineering equipment requirements. Only once we have all information we need will we send a detailed proposal.”

Amongst this year’s delegates were representatives Belgian agro-industrial group SIAT, Cameroonian palm oil company Socapalm, and Ivorian edible oils company Sarci as well as various South African companies such as South Focus Enterprises, Rhodes Foods, Le Coquin Foods, and Cape Food processors.

“It was great to connect with these companies, listen to their achievements over the past year, exchange ideas about the latest developments within Africa’s food, edible oils, and beverages sectors, and discussing the latest engineering breakthroughs,” Juncker says.

Stainless steel process engineering equipment

This year’s conference’s agenda was jam-packed with valuable information. The talk by Michel Basson from the South African Stainless Steel Development Association (SASSDA), in particular, stood out. “He spoke in detail about the various grades of stainless steel South Africa manufactures, supplies, and exports – including  3CR12,” Juncker recalls, referring to the type of stainless steel that is recognised as the world’s most specified 12% chromium utility ferritic stainless steel.

“It is a phenomenal product that is price competitive, corrosion resistant, and tough, even when welded in thicknesses of up to 30mm. It retains this toughness at temperatures below freezing point, Juncker continues, adding that 3CR12 meets the European standard 1.4003 and conforms to ASTM A240-UNS-S41003. “Many delegates were blown away by Basson. They had no idea about the stainless steel sector in South Africa and South Africa’s stainless steel engineering equipment manufacturing capabilities, which are world-class and price-competitive!”

Better than emailing a brochure

The gathering’s biggest benefit for attendees was them getting a first-hand account of what Resulta can do for them, what products it delivers and that South Africa’s technical manufacturing capabilities and the quality of its raw materials are top-notch. “Such tours are much better than emailing clients an online catalogue or brochure,” Juncker says. “During our factory tours, our clients once again realise that we are a capable and reliable supplier of quality process engineering equipment – and responsive to their needs!”

About Resulta Exporters: Resulta is a consulting project engineering company in South Africa that supplies quality process engineering equipment, components, and other machinery to dairy companies, food manufacturers, and processors across Africa. We partner with companies in the edible oils, palm oil, dairy, fruit & vegetables, beverages, and agro-processing sectors. Our competitive edge lies in our ability to customise all design elements of our process engineering equipment. This allows meeting our customers’ very specific and ever-changing needs time and time again. 

This is amplified by our personalised service ethos, which includes on-site meetings with prospecting clients (on our account) prior to tendering.

Feronia Releases 2017 Financial Results

Agricultural and palm oil company Feronia Inc, one of Resulta’s long-standing clients, has released its very optimistic audited financial results for the year ended December 31, 2017.

“We take great pride in what we have accomplished in 2017,” said the business’ CEO Xavier de Carnière in a recent statement.

“We have achieved a 31% production increase in one year (62% in two years), whilst continuing to develop our social and environmental efforts, entering into agreements with our communities, reducing our cost of production, bringing a new significant shareholder on board, finalizing the disbursement of our loan facility, reinforcing our team, increasing our workforce’ salaries to reflect the consumer price index in the DRC, commissioning possibly Africa’s most modern boiler & turbine in Yaligimba, kick-starting the rehabilitation of our Lokumete mill and commencing our Boteka boiler & turbine projects.”

“Whilst a moment of proud reflection is warranted, there is still much to be done before we can confidently consider that we have reached cruising altitude. For instance, the variable portion of our cost of production, including transport costs and labour efficiency, require improvement. Absenteeism at the plantations remains a serious concern. Our housing renovation programme is not progressing as fast as we hoped, partly because of difficulties in bringing the right skills to the sites. Agricultural upkeep standards are not at the required level yet, although they are rapidly improving, and downtime at our Lokutu and Boteka mills are still above acceptable levels; a direct consequence of insufficient preventative maintenance.”

“We have demonstrated our ability to face difficult challenges as a team, and overcome them one by one. We are now confidently capitalizing on that ability and the trend is clearly pointing in the right direction and we are delivering on our business plan. Together we have the skills, the determination and the passion. The challenges before us may still be plenty, but we are confident that we will succeed.”

2017 Highlights:

  • Produced 143,572 tonnes of fruit (2016: 109,061 tonnes), a year-over-year increase of 32%
  • Produced 27,189 tonnes of Crude Palm Oil (“CPO”) (2016: 20,724 tonnes), a year-over-year increase of 31%
  • Revenue of $21.1 million (2016: $17.2 million), a year-over-year increase of 23%, primarily from the sale of 24,609 tonnes of CPO at an average price of $775 per tonne (2016: 23,293 tonnes at $670 per tonne)
  • Completed installation of new fibre boilers and turbines at Yaligimba and Lokutu
  • A completed drawdown of remaining $34 million of DFI Debt Facility

Feronia is an agribusiness operating in the Democratic Republic of the Congo (DRC) specialising in palm oil. At its heart lie Plantations et Huileries du Congo (PHC), which has three remotely located plantations (Lokutu, Yaligimba and Boteka). Feronia’s plantations produce crude palm oil (CPO) and palm kernel oil (PKO). CPO is part of the staple and traditional diet of the Congolese and, with our products sold locally in the DRC, we are well placed to help decrease reliance on imports and increase food security and quality. The company is committed to improving the living and working environment of its employees and their communities and are committed to sustainable agriculture, environmental protection and community inclusion. Feronia has in place an Environmental and Social Action Plan which is focused on implementing environmental and social best practice and improving social infrastructure. Resulta is one of the leading suppliers of palm oil engineering equipment in Africa, Feronia being one of our clients.

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