Made in Africa: €12m investment boosts Kenyan supplement production
The company will use the funds from World Bank Group member, the International Finance Corporation (IFC), to up production capacity of its Ready-to-Use Therapeutic Food (RUTF) threefold and reach an estimated 250-350,000 extra people.
Sagar Chandaria, finance director for the family company, told us the expanded capacity would mean it could stockpile the products allowing for greater flexibility in cases of emergency in the region like drought or conflict.
“If something happens and strikes very quickly then the products can leave our warehouse very, very fast and be in South Sudan or Kenya or Rwanda at an exceptionally fast pace.”
Yet Kenya-born and Canada-educated Chandaria also hoped the expansion would lead to a paradigm shift.
“It’s very important to have the mind set shift that these kinds of problems can be solved in places like Africa for Africa – even though it’s a donor product system it’s not so much about [needing] to rely on foreign aid for this to happen or even foreign manufacturing.
“And by doing this you create a dramatic shift in the mind set in what’s possible and you start to develop then more longer term commercial solutions to these problems and you start to develop a lot more internal thinking within Africa about how they can solve their own problems.”
Trade and aid
The United Nations Children's Emergency Fund (UNICEF) is one of EPZ’s biggest buyers – but only seven of the NGOs 17 global RUTF suppliers are in Africa itself overall.
One major supplier is French company Nutriset, which produces the fortified peanut butter product 'Plumpy’nut'.
According to UNICEF price sheets Nutriset is currently producing the products for the lowest price.
EPZ hopes its increased and improved production following the IFC investment will bring its costs down by 5-10%.
Chocolate giant Hershey also made commitments in this area last year – aiming to reach 50,000 Ghanaian school children by 2016 with its free fortified peanut-based paste supplement Vivi.
Part of the commitment was to source 100% of the peanuts locally – for which 7,500 peanut farmers in Ghana would be trained.
Chandaria said its peanuts did not come from Africa because standards of production needed to ensure low levels of carcinogenic aflatoxins were not yet there.
This was vital given the vulnerable population these products were made for.
However the company is now in talks with local growers to try and improve standards for the future.
Its increased output may also help assure local smallholder producers that there would be consistent demand for the crop, he said.
According to Mintec data, the top three peanut producing countries are China (16.5 million tonnes per year), India (5.2m) and Nigeria (3m). Total global production is around 40m tonnes.
Spotlight on RUTF
Last year UNICEF and the Japanese government injected €4.5m (500m Kenyan shillings) into a RUTF programme to combat acute malnutrition in children in the Turkana and Laikipia regions of Kenya.
Chandaria said part of the increased interest in RUTF products was understanding of their efficacy.
According to a paper published in the American Journal of Clinical Nutrition, 98% of children treated with RUTF were well-nourished after six months and 96% were well-nourished after a year.
The World Health Organisation (WHO) has also earmarked RUTF products as one possible solution to malnutrition in the developing world.
“The advantage of RUTF is that it is a ready-to-use paste which does not need to be mixed with water, thereby avoiding the risk of bacterial proliferation in case of accidental contamination,” it wrote.
'Prophylactic, constant nutrition'
While these RUTF products are meant only as a treatment for severe malnutrition, the company hopes to build on from this to create more everyday products to help tackle less acute but debilitating nutrition issues like stunting.
“The truth is I don’t think they’ll ever be a day when ultimately you don’t need them [RUFT products] at all because of macroeconomics and a growing population and things like that," Chandaria said.
“But I think if you can slowly portion off more and more people away from requiring this specific product through more long-term interventions through prophylactic, constant nutrition then that would help that. We would love to eliminate it [malnutrition] but unfortunately I don’t think it’s possible.”
Future day-to-day products would be part of the company’s ambition to create a more “inclusive nutrition space” through low-price, high-quality nutritional products, he said.