Egypt: Feed for development: a pioneer partner from aid to trade to investment
Trouw Nutrition becomes the first international company to produce premix for animal feed in Egypt. A great move from trade to investment by a Dutch company using Egypt as a hub to access markets in Africa. Creating agrifood jobs for men and women and providing farmers with quality inputs. Ambassador Han-Maurits Schaapveld joined General Manager Ayman Rostom for the soft launch. They discussed how Nutreco Egypt - a result of aid for trade - contributes to good Egyptian, Dutch relations and potentially more partnerships impacting on the SDGs.
Netherlands based animal nutrition company Nutreco has chosen Egypt as a place to produce premix for animal feed. In doing so they establish their Trouw Nutrition brand in the market with the largest population in the Middle East. As a few other Dutch companies, like Farm Frites, Koudijs de Heus and Heineken, they take advantage of Egypt’s potential as an agri-food hub to serve markets in the region and into Africa.
From trade to investment
Nutreco started trading in Egypt in the eighties when it exported feed concentrate under the Hendrix brand. In 2001 they took the decision to move from trade to investment. With Dutch government support (under the PSOM programme), they built a feed factory as a joint venture with two Egyptian family businesses. At the time they were a first mover for the local production of quality animal feed. Since then numerous companies have entered the market. In response to opportunities in aquaculture, the company diversified into producing fish feed under the Skretting brand. In 2013 Skretting Egypt was established as a full subsidiary of Nutreco NV. Now the company is pushing the development of the Egyptian feed sector one step further with the local production of premix.
Investing in people and the SDGs
A talented team of Egyptian agri-food professionals who are part of a global corporate family are the secret behind this success. The company’s focus on international quality and food safety standards, as well as its values of corporate social responsibility, combined with staff’s knowledge of doing business in Egypt provides the best of both worlds. Egyptian staff play a key role in sharing knowledge with other Nutreco partners in Africa and beyond. As part of their agenda to invest in people, they have participated in a project supported by the Netherlands Embassy and the Sawiris Foundation for training and employment of women. This led them to recruit their quality assurance coordinator after a successful internship. They were rewarded for this achievement but their investor SHV Holdings with social impact award.
This can be an inspiration for exploring new partnerships with agribusinesses like Nutreco to create impact on reaching the sustainable development goals (SDGs), such improved nutrition, better incomes for farmers, and more sustainable production.
Opportunities at a tough time
Nutreco’s continued investment is a welcome development during a difficult time for the Egyptian animal protein sector. The COVID 19 pandemic has led to poor consumers cutting back on their consumption of fish and poultry. Farmers meanwhile are struggling with overproduction and low prices, leaving them with loans outstanding with companies providing inputs on credit. Feed companies like Nutreco thus have an interest in their clients’ success. Supporting the professionalisation of SME family farms, a cool chain and value addition along the value chain, supply chain finance are ways of increasing farmers’ resilience.
Circular and climate smart?
Beside opportunities to enhance farmers’ resilience, there are opportunities to improve the ecological impact aqua and poultry sectors. Feed producers in Egypt depends on imported soy and cereals, as the water footprint of these crops is too high for Egypt to meet its needs. The agricultural team of the Netherlands Embassy has engaged with companies such as Skretting Egypt to explore opportunities for circular proteins for aquafeed.
Other ways to reduce the carbon and water footprint of fish farming are being explored by Nutreco together with researchers from Wageningen and World Fish (CGIAR). In a project on ‘circular ponds’ in Vietnam, they discovered that in shrimp production feeding algae in the pond rather than the shrimp directly would reduce feed loads by 20%. This may provide an opportunity for Egyptian fish ponds. A further circular opportunity concerns the application of right-tech recirculation aquaculture systems (RAS). In a water scarce country like Egypt, this provides a chance to improve water quality and reuse water. The question is whether farmers can afford the investment and still get a return.