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Red Stripe pours US$1m into 300-acre cassava farm, processing plant

Red Stripe pours US$1m into 300-acre cassava farm, processing plant

Posted by Shanelle Weir on October 09, 2014

Red Stripe is spending US$1 million (J$112 million) on its 300-acre cassava farm and processing plant as it moves to use the nutrient-rich tuber to offset barley imports used in beer production.

"The pilot farm is the initial phase of the project targeting some 300 acres for cultivation over a 24-month period, with US$1 million earmarked for this segment of the undertaking," Red Stripe said in its annual report released this week. "A starch processing plant will also be installed by the end of the 2014 calendar year capable of processing up to 300 acres of cassava per year."

In January, Red Stripe signed a lease agreement with the Ministry of Agriculture for lands at Bernard Lodge in St Catherine to facilitate its cassava-growing project. Red Stripe plans to cultivate 2,400 acres within five years and provide employment for one person per acre. The company hired farm manager Dr Nickeisha Reid in March with a remit to increase cassava yields.

"In addition to leading the implementation of the 36-acre pilot cassava farm, she is also in charge of training in the first and second phase of the project to deliver clear-range genetically modified organism-free cassava cultivars. With attention to all elements such as yield and price, Dr Reid will also forecast and plan the agro-production," stated Red Stripe, which earned $3.3 billion in after-tax net profit for its year ending June 2014, or 177 per cent higher than year-earlier levels.

The company benefited from a near $2-billion jump in sales, to $14 billion, while keeping expenses flat over the period.

The parent company of Red Stripe, UK-based Diageo, wants its subsidiary to replace 20 per cent of imported inputs, primarily barley, used in the production of its flagship product, Red Stripe Beer.

Red Stripe will emulate similar projects in Africa, Brazil and The Philippines and incorporate best practices.

Red Stripe holds total equity of $9 billion from $7.6 billion a year earlier.

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