Africa’s front line investor and chairman of the Dangote Group, Alhaji Aliko Dangote, is set to take total control of the diary and milk sector in Nigeria with a target of 50,000 cows and 500 million liters of milk annually as from 2019.
To achieve this feat, the group plans to set aside $800 billion for diary production and additional $3.8 billion investment to raise sugar output to 1.5 million metric tons a year by 2020 from the current 100,000 tons and as well increase rice output by 1 million tons of rice per annum in the next three years.
Dangote also plans to cultivate 350,000 hectares (864,850 acres) of land for sugar cane and another 200,000 hectares for rice, as the group has ordered five plants for sugar milling and 10 for rice milling from Switzerland to be located in the northern parts of the country.
According to Bloomberg, the move will position the conglomerate to lead in the dairy industry with the capacity to supply one third of the country’s demand in dairy, sugar and rice and ultimately conserve a lot of foreign exchange for the country.
It was gathered that the project will be financed through “internal resources or equity funding” and loans from banks and export-credit agencies. The funds will be used mainly to procure “farm-development equipment” as well as sugar and rice mills.
It is on record that Dangote has the largest cement investment in Nigeria and has divested into agriculture as Nigerian government seeks to diversify from oil, which accounts for 90 percent of the nation’s export earnings and the bulk of its revenue.
According to the disclosure, other sectors the Dangote Group is planning to invest into include production of soybean, oil palm, palm kernel and corn. The group will also extend helping hands to low scale farmers by supplying them with high-yield seeds, pesticides and fertilizers.
A World Health Organization (WHO) report shows that Nigeria requires about 1.5 billion litres of milk annually and the US department of agriculture has placed Nigeria on the list of countries with “insufficient” milk import at $225 million per year, stating that the country’s dairy market has a potential in excess of $3 billion.