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.
(Nairametrics)