Dangote shuts down tomato factory. Again.


Barely three months after resumption, Africa’s richest man Aliko Dangote has been forced to close it down again, due to a tomato pest invasion.

Here are the key points from the shut down:

  • The factory has a production capacity of 1200 metric tonnes a day and can produce 400,000 tonnes of tomato paste annually.
  • 8000 farmers agreed to supply tomatoes at $700 a ton, twice the domestic price.
  • The farmers are no longer keen on farming the crop after pest attacks last farming season.
  • The disease called tomato absoluta originated from South America.
  • The factory has had chequered operations due to a lack of raw tomatoes since it opened March last year.

The shut down has several implications for the firm. Machinery and equipment will have to be mothballed. A foreign crew will have to be flown in to service the equipment before operations resume. The farmers may decide to go for a higher price.

Ultimately the tomato paste produced by the firm will be more expensive. National Bureau of Statistics (NBS) April report released show the food sub index increased 0.17% month on month from 2.04% in March to 2.21% in April. The index also increased 0.86% year on year from 18.44% in April 2016 to 19.30% in April 2017.





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