Business News of 2013-12-18

Techiman tomato factory opening suspended

The commencement of operations at the Techiman Processing Complex (TEPCO), a tomato processing plant at Techiman in the Brong Ahafo Region, that was scheduled for this year has been deferred to June 2014.

This is largely because of non-availability of raw materials to feed the Company, CEO of TEPCO, W. A. Ofori has revealed.

“The machinery and other installations are 99% complete, human resource is intact but raw materials -- mainly fresh tomatoes required for profitable and sustainable processing -- are currently not available within the catchment area of the company,” he said.

Briefing the B&FT in an interview, Mr. Ofori explained the tomato variety that the farmers cultivate within the Techiman vicinity is not “productive” for agro-processing, hence the inability to rely on them to begin operation now, saying: “The farmers’ tomato variety when processed is 7-10 tonnes of fresh tomatoes:1 tonne (puree) while the industrial variety needed is 5 tonnes:1tonne.

“We are now conducting varietal trials and also sensitising farmers on cultivating the appropriate tomato variety for production. This will help us to make a fair profit, which will also ensure sustainability in the long run.”

Management of the company has also started cultivating its own tomatoes to supplement the expected supply from out-grower farmers. The company has started with an acre of land at the Tanoso Irrigation Site while plans are also advanced to develop its 25 hectare acquired land at Akomadan in the Ashanti Region.

Mr. Ofori, a Food Scientist, also mentioned lack of credit from the banks as another challenge delaying the company’s commencement of operation. “The general banking system in the country is hostile to agro-processing. The banks are not willing to put money where the mouth is, and they [banks] want investors to manufacture the money then they will step in to harvest when it ripens”.

Management of the company is realising the aforementioned shortfalls in the tomato processing industry of the country and some other nations like Kenya and Tanzania, he said: “We have critically analysed the situation and are mapping strategies to circumvent them when we zoom into full operation by mid-2014 in order to prevent the company falling into a ditch, as many tomato factories have suffered in the country.”

The minimum capacity of the company is two (2) metric tonnes per hour as against four (4) metric tonnes per hour as its maximum capacity. The Techiman Tomato Factory is a brainchild of the Ministry of Food and Agriculture and the Italian government, and was officially inaugurated in December 2012. It was later put out for bid, which Mr. Ofori and his partners won -- thereby changing the name to Techiman Processing Complex (TEPCO).

The new investors have so far committed about GH¢250,000 into the company. Currently, the company is installing a garbage-feed bio-gas digester to replace the existing boiler, which consumes about US$300,000 worth of diesel per annum, as a way of reducing cost of production.