The drinks giant now sources around 50% of raw materials locally in Africa, but said it aims to increase this to 70%, an increase of 30% from a 2007 baseline of 40%.
“The new projects in Ethiopia and Tanzania will provide Diageo with a long-term, secure and sustainable source of raw materials, which reduces exposure to increasingly unpredictable changes in availability of materials, and potentially volatile global commodity markets,” Diageo said.
The projects in Sebeta (Ethiopia) and Mogoro (Tanzania) are worth $1.5m (€1.17m) and $2m respectively, and will begin this year to support development of agricultural communities across Africa, an aim that Diageo said was consistent with its African growth ambitions.
Sorghum value chain
In Ethiopia, a public-private partnership with the Ethiopian Agricultural Transformation Agency (ATA) will see Diageo design and test a pilot barley contract farming project, to source 1,000 MT of barley from local smallholders in its first year of operation.
This yield could be increased to 20,000 MT of barley in the following years, for local use within Ethiopia or for export.
Diageo is also seeking to scale-up sorghum sourcing cultivation and sourcing in Tanzania to 20,000 MT per year by 2015 for local use and export, via collaboration with the country’s government.
This project aims to build a sustainable sorghum value chain, with smallholders linked to larger ‘nucleus’ farms, and to develop and share both sorghum cultivation and post-harvest practices.
Resource scarcity
Both investments were announced at last week’s Symposium on Global Agriculture and Food Security hosted by the Chicago Council on Global Affairs (in collaboration with the World Economic Forum).
The symposium brought together US President Barack Obama with G8 and African leaders to discuss initiatives to advance food and nutrition security in Africa.
Paul Walsh, Diageo, CEO, said: “The complex global challenges we face – from climate change to resource scarcity – will require even greater cooperation and collaboration between the public sector, private sector and civil society.
Walsh added that Diageo needed to engage with stakeholders across the ‘whole value chain’ to create strong socio-economic development programmes and achieve its business aims.
“The new projects in Ethiopia and Tanzania will provide Diageo with a long-term, secure and sustainable source of raw materials, which reduces exposure to increasingly unpredictable changes in availability of materials, and potentially volatile global commodity markets,” Diageo said.
The projects in Sebeta (Ethiopia) and Mogoro (Tanzania) are worth $1.5m (€1.17m) and $2m respectively, and will begin this year to support development of agricultural communities across Africa, an aim that Diageo said was consistent with its African growth ambitions.
Sorghum value chain
In Ethiopia, a public-private partnership with the Ethiopian Agricultural Transformation Agency (ATA) will see Diageo design and test a pilot barley contract farming project, to source 1,000 MT of barley from local smallholders in its first year of operation.
This yield could be increased to 20,000 MT of barley in the following years, for local use within Ethiopia or for export.
Diageo is also seeking to scale-up sorghum sourcing cultivation and sourcing in Tanzania to 20,000 MT per year by 2015 for local use and export, via collaboration with the country’s government.
This project aims to build a sustainable sorghum value chain, with smallholders linked to larger ‘nucleus’ farms, and to develop and share both sorghum cultivation and post-harvest practices.
Resource scarcity
Both investments were announced at last week’s Symposium on Global Agriculture and Food Security hosted by the Chicago Council on Global Affairs (in collaboration with the World Economic Forum).
The symposium brought together US President Barack Obama with G8 and African leaders to discuss initiatives to advance food and nutrition security in Africa.
Paul Walsh, Diageo, CEO, said: “The complex global challenges we face – from climate change to resource scarcity – will require even greater cooperation and collaboration between the public sector, private sector and civil society.
Walsh added that Diageo needed to engage with stakeholders across the ‘whole value chain’ to create strong socio-economic development programmes and achieve its business aims.
