ZAMBIA – 260 Brands, an agro-processing company based in Zambia, has received US$5m investment from the Norwegian Investment Fund, Norfund, to finance its expansion into soymilk production.
Celebrating its silver jubilee, the consumer goods company that manufactures, markets, and distributes products mainly based on maize and soy, recently launched the country’s first plant-based milk dubbed Nutramilk, made from locally sourced soybean.
Founded in 1997, Two Six Zero Brands has consistently pioneered healthy and affordable maize and soya products, including textured soy as a meat alternative, powdered/instant drinks, corn soya blend (porridge), as well as snacks, demonstrating value addition in soybean besides traditional cooking oil.
The capital from Norfund will finance an investment in a turnkey soymilk production facility with an annual production capacity of 9.6 million litres.
The unit is set to utilize the UHT technology and aseptic packing that allows for a long-shelf life of the products in ambient temperatures, an important factor for sales and distribution in Zambia, where the cold-chain infrastructure does not allow for availability of such beverages country-wide.
“We’re honoured to have Norfund on board with us on this new innovative project, which is the first of its kind, in Zambia.
“They’re a partner who share similar values as us on equitable growth and job creation, alongside positive impact towards climate action,” says Gaurav Vijayvargiya, Chief Executive Officer, 260 Brands.
The company’s diversification to the dairy alternative category is timely as the segment is gaining momentum in the region.
According to Norfund, most of the population in the region are lactose intolerant and the company believes soymilk can be an attractive alternative.
The total milk consumption in the country is currently at 20 liters per capita, well below the annual world average of 104.
To boost consumption of the alternative milk offering, 260 Brands is targeting a price close to the dairy milk, as the former mainly comprised of imported products, is currently more expensive by 30-60%, which has made the plant-based milk segment slack in popularity.
The investment is also set to meet estimated potential in the market whilst benefiting from synergies with existing business and established access to soybeans.
“Through providing capital to allow the company to expand into the production of soymilk, Norfund will contribute to create much needed jobs and increased income for smallholder farmers, while increasing access to locally produced nutritious food,” says Andreas Davidsen, Vice President and head of Agribusiness and Manufacturing at Norfund.
260 Brands has developed a network of 2,500 small holder farmers that supply soybeans, while receiving support for investing in its small holder farmers as long-term partners by providing agronomic training, inputs on credit and purchase of the farmer’s commodity conveniently at his or her doorstep – all helping to contribute to a profitable farming enterprise for a local, small holder farmer.
“We expect the investment to create 100 new direct permanent jobs, and an increase of local farmers that receive increased income through supplying the company of more than 12,000 small holder farmers,” says Davidsen.
Norfund also plans to assist the company in strengthening ESG and management systems, and to improve corporate governance.
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