CIC Holdings PLC is gearing to set up a dairy milk processing operation in Matale with a Rs 400 million investment, the company’s top executive said. “We’re trying to set up a production facility in the Matale district for dairy products,” B.R.L. Fernando, Chairman CIC told the Business Times. He said that this facility will have around a 30,000 litre capacity and all the products will be used for local consumption. He also said that CIC's Hingurakgoda Farms and newly commissioned Saddhaura and Muthuwella farms are expected to cater to the growing demand for dairy industry in the country.
He added that now the focus of CIC, which is famously known as a paint/chemical company is to grow its agricultural and livestock sectors. “This is because these sectors give some of the best opportunities in the current economy in the country," Mr. Fernando noted. He said that CIC's agriculture and livestock sector stands as the core business contributing 68% of total revenue and 76% of total net earnings during the last three quarters with operations in producing agricultural inputs such as seeds, planting material, livestock products, distribution of machineries plus blending and marketing fertilizer.
The company has also ventured into Bangladesh with a large Bangladeshi supermarket chain called Rahimafrooz where CIC will do extension work with Bangladeshi farmers and source agricultural produce to this chain. “We’re replicating the same model, which we do here in Sri Lanka, in Bangladesh," he said, explaining that by promoting CIC’s agricultural model, the company will tap new potential markets in the future.
“We’re helping the farmers with the fertilizer and transfer of technology in order to improve the quality of their products,” he explained. He said that CIC also started a similar operation in the UAE by setting up green houses there in a bid to grow plants and market them.
"We ventured into a partnership with Dubai based S. S. Lootah International to supplying indoor plants,” he said, adding that the latter is a well-recognized landscape construction and plants maintenance company in the UAE.
Mr. Fernando also said that CIC wants to start a tissue culture project in Uganda. "We plan to explore the African region with similar projects," he added.
Mr. Fernando also said that the newly commissioned seed coating facility at Dambulla is poised to add more value to company’s products and services. “We started this last month and with this we're giving farmers better quality seed," he explained. He said that seed coating has become an essential element of success in the production of many crops.
Last quarter CIC Agri business ventured into a large maize out-grower programme and Mr. Fernando said that the company intends to produce 25,000 metric tonnes annually. "With a farmer network of 5,000 in Northern Province we are on a good footing," he added, noting that about two three years ago, the country used to import about 200,000 metric tonnes of maize. “But since last year, we produce about 60,000 to 70,000 metric tonnes.”
The country's current annual maize production is about 40,000 metric tonnes, as per industry records whilst the demand records at 240,000 metric tonnes providing a significant business opportunity to grow in the maize industry. Analysts said that the worldwide maize prices are witnessing an upward trend due to high demand for bio fuels which will provide higher possibility to benefit from global demand in the foreseeable future.