August 2, 2011
Charoen Pokphand to build Nigerian animal feed factory
Charoen Pokphand Food Company Limited, one of the largest Thai conglomerates, has expressed interest in establishing an animal feed mill in Nigeria as part of its investment preparation in Africa.
The group wants Nigerian government to wave the Valued Added Tax (VAT) on animal feeds, arguing that it is the animals that consume the feed and not human beings.
Speaking during a visit to the Nigerian Investment Promotion Council (NIPC) in Abuja, the Assistant Vice President of the company, Tony Lovell said the group started surveying Nigeria, Senegal and Ghana two years ago.
He said, "We are here today because we are looking at the possibility of investing in Africa and because Nigeria is the power house of West Africa, we believe that we should come to Nigeria first. Senegal and Ghana were discounted because they allow the importation of chickens into their countries free and that makes the local industry uncompetitive.
"Because Nigeria does not allow the import of chicken products, we are now here to do a more indebt study of the investment possibilities. We are going to be doing a lot of survey, looking at traditional markets where you sell a life chicken."
He said that the proposed factory can mill both powdered and pellet mill in tone of between 5,000-10,000 tonnes per month, adding that in Thailand, "we have a feed mill of 120,000 tonnes per month so it depends on how the group come with its business."
He said the company method of investment is to first establish animal feeds after which they go into hatchery business providing day old chic for people.
Speaking, the Executive Secretary of NIPC, Engineer Mustafa Bello urged the company to continue with its investment plans as they will contact the Minister of Finance when she resumes office on the possibility of removing the VAT on animal feeds.
"One thing I know is that market exist here whether we wave the VAT or not. I will advice that you continue because the VAT is only 5% in Nigeria, the lowest ever. So whatever implication it will have in terms of overall pricing of the products at the end of the day is going to be of less significant," he said.