Nutreco enters into Nigerian joint venture
Nutreco on Tuesday announced it signed an agreement to enter into a joint venture in Nigeria with Durante, an existing distribution partner and fish feed supplier.
The joint venture, Skretting Nigeria, will invest in the local production of extruded fish feed for Nigeria as well as the wider West African region.
Nigeria produces more than 200,000 metric tons (MT) of fish feed annually, mostly for catfish, and aquaculture production is growing by 5 percent to 10 percent annually.
The Skretting Nigeria 60/40 (Nutreco/Durante) joint venture will sell extruded fish feed and operate a plant in Ibadan, Oyo State, both for the local market and regional export. Durante’s revenue in 2013 was approximately EUR 9 million (USD 12.2 million). Sales volume is currently around 5,500 MT and, with the addition next year of a new extrusion line, is expected to double by 2016. The current market share in the Nigerian high quality extruded fish feed market is about 15 percent. Closing of the transaction is expected within the next three months.
“By entering into this joint venture we establish our presence in the Nigerian market, which is one of Africa's most important. This is Nutreco's second foothold in Africa, after our investment in Egypt last year, and expands our share of fish feed for non-salmonid species. This fits perfectly in our strategy,” said Knut Nesse, Nutreco CEO. “We intend this joint venture to provide a base for further expansion in the fast growing West African fish feed market."
As part of Nutreco's entrance into the Nigerian market it will explore — together with Oxfam Novib — how to increase the productivity of small fish farmers. In Southwest Nigeria local NGOs are engaged in assisting small fish farmers with livelihood improvement programs. Nutreco, Durante, Oxfam Novib and other stakeholders see good possibilities to assist in increasing the yield of these small fish farmers and thereby contributing to the global challenge of feeding nine billion people sustainably in 2050.