ETHIOPIA – The Tsehay Farmers’ Cooperative Union, an Ethiopian farmers’ based union, has invested US$2.46 million (70 million birr) in setting up a new edible oil processing plant in Amhara Regional State.

The processing plant has a daily production capacity of refining 10,000lt of oil from sesame seeds, niger seed, sunflower and peanuts, reports Addis Fortune.

Construction works of the 8734 square metre facility begun in 2017 and with its recent completion, the plant is expected to offer more than 70 direct employment opportunities.

According to Endalkachew Abi, chief executive officer of the union, oil made of sesame will be exported, while the rest will be retailed in the local market.

Endalkachew added that when fully operational, Tsehay will collect more than 80,000 tonnes of various types of oilseeds a year from five cooperative unions.

The Union has also unveiled plans to invest in the expansion of the processing plant to produce oil from soybeans.

Previously, Tsehay Farmers’ Cooperative Union has been engaging in trading cereals, processing animal feed, distributing consumer products and exporting sesame.

Additionally, the Union is also planning to invest in expanding the animal feed processing plant and opening a nail and corrugated sheet manufacturing company.

Tsehay Farmers’ Cooperative Union has 120,450 farmer members and is among the 388 cooperative unions in Ethiopia.

According to the Fortune, the country’s edible oil sector is characterised by more than 1,000 small and micro oil processing companies and an aditional 27 large and medium-sized oil processors.

However, despite the high number of oil processors, latest data from the Food, Beverage & Pharmaceutical Industry Development Institute reveal that imports account for 96% of the nation’s edible oil demand.

Ethiopia imports about 350 million tonnes of subsidised palm oil a year to bridge the shortage gap majorly from Indonesia, Malaysia and Singapore.

The country has an annual potential of producing more than 785,000tn of oilseeds.

In 2011 the government of Ethiopia imposed a ban on edible oil imports by private companies but later through the Ministry of Trade & Industry selected public and private companies were granted permission for importation.

Among them include Hamaressa Edible Oil S.C, Alle Bejimla and Belayneh Kinde Import & Export who ship and distribute edible oil to the local market to meet the growing demand.