The first Ethiopian malt factory, Assela Malt Factory, management team has decided to import 260,000 Quintals of barely at an estimated cost of 275.2 Million Birr. The company is waiting for the approval of the board of directors to execute the decision.

This ironically happened following the expansion work Assela undertaken at a cost of 300 Million Birr to stop malt import.

The factory assumed it will get its input from the surrounding areas, Assela town in Arsi Zone, that is well known for it’s barely production.

Nonetheless, the estimated amount of barely supply that was expected to be used by the expansion project is not flowing all year round. And because of this the company now faces a risk of running out of stock in two months time.

Assela normally secures 90 percent of it’s domestic barely supply from the traders who collect the crop from smallholder farmers in the Arsi Zone and Sidam Zone.

Yet the domestic supply recently has not been reliable. Thus, the facotry is being forced to import barely in order to cover the gap.

Commenting on the shortage the Director General of the Factory, Amare Wakjira, said Assela needs 40,000 Quintals of malt every month and the local supply has stopped.

Amare further noted his company buys the local barley from 900 Birr to 1,050 Birr, however, the imported barely is going to cost the company 1,048 Birr.
According to Amare Officials from the Oromia State Agricultural Bureau attribute the shortage problem to hoarded harvest by farmers.

The factory demands more than 600,000 Quintals of raw malt barely in order to produce 360,000 Quintals of malt per annum.

Amare commented “If we don’t import the barely and produce malt, the beer factories would import the malt directly, with which they are covering more than 60 percent of their demand already”.

Assela was established 30 years ago and was the sole supplier of malt to the local beer industry for a long time. 

Source: Fortune