Oman Flour Mills eyes major projects to drive growth

31/08/2017 07:13 AST

Majority state-owned Oman Flour Mills (OFM), which oversees a sizable portfolio of food related enterprises, is keenly pursuing new business initiatives to grow and diversify its presence in the strategically important food processing sector in the Sultanate.

Notable is a world-scale egg project an MoU for which was inked by the Muscat-based Group with a number of strategic partners last December. Partnering in the development of the project are Gulf Japan Food Fund (GJFF), which is 35 per cent owned by the State General Reserve Fund (SGRF) (a sovereign wealth fund of the Sultanate of Oman), IFFCO Group of the United Arab Emirates, and Ise Foods of Japan.

At the heart of the project is a table egg producing facility envisioned at Ibri in Dhahirah Governorate with a capacity of 360 million eggs per year - effectively positioning the project as the largest of its kind in the Gulf region. A key stakeholder in its successful implementation is the Public Authority for Stores and Food Reserves (PASFR), which has the mandate to secure the long-term food requirements of the nation.

"Feasibility, market studies and other reports are currently being evaluated before a firm decision can be taken," said Salim Khairulla, Acting Chief Executive Officer - Oman Flour Mills in a recently published Management Discussion and Analytical Report on the Group's financial performance for the year ended June 30, 2017.

Also in the Group's sights is a project centring on the construction of silos for the storage of grain linked to PASFR's food security strategy. The complex of grain silos is proposed to be built not far from the new Sohar Flour Mills currently under construction within SOHAR Port. "The company is in discussion with the (government) for undertaking the project for building silos for strategic food storage. Should this project materialize and be awarded to Sohar Flour Mills, the construction and management will be done by a Group company and it will receive rental income from the government," said Khairulla.

Omani contractor Al Rawahi International Co is currently undertaking the civil works for a 560 tonnes per day capacity mill at Sohar, which can be scaled up to 2,000 tones per day in the future. The client is Sohar Flour Mills LLC, a partnership between Atyab Investments, a wholly-owned subsidiary of Oman Flour Mills Co, and Essa Al Ghurair Investments of the UAE. "A contract with the supplier for the milling equipment has been finalized and the construction of the mill has commenced and production is expected to start from mid-2018," the Acting CEO said.

Last week, Atyab Investment LLC, a wholly-owned subsidiary of Oman Flour Mills, announced plans to set up a new soya crushing project in the Sultanate. It committed RO 5.2 million in funding for the project, representing 40 per cent of the project's equity.

Oman Daily Observer