NATIONAL Foods Holdings Limited chief executive officer Mike Lashbrook says the company’s expansion into value-added food production will create new markets for local wheat farmers and support small-scale producers.
In July 2024, the company revealed it had spent US$40 million as capital expenditure over the past three years to introduce new production lines and scale up existing production to target the informal and export markets.
Part of this expenditure included US$5,6 million set aside for a new pasta production line, biscuit production line (US$7,7 million), and breakfast/cereal production line (US$4 million).
Last week, President Emmerson Mnangagwa commissioned these new production lines, the pasta facility, at a final cost of US$6 million and the breakfast/cereal plant at US$7 million.
“We believe this expansion will create more opportunities for local farmers. Take pasta, for instance, it is essentially made from flour and water. Flour comes from wheat, and by increasing our production of pasta, we are increasing demand for wheat,” Lashbrook told businessdigest in an interview.
“It is simple economics — higher demand is good for producers. So, this expansion will help create a bigger, more stable market for local farmers, and we see that as a very positive development.
“So, I think what we see here is there is a potential to increase the market for local farmers because if I give you an example of pasta, it is essentially flour and water.”
He said the three new plants were part of Natfoods strategy to move up the value chain.
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“National Foods has been in the milling business for many years, producing maize meal and flour. It made logical sense for us to start adding value to these milled products,” Lashbrook added.
“We believe there is a strong and growing market for these products, and we are confident about the future of the economy. That is why we made this investment.”
Concerning power challenges, a major challenge for manufacturers and producers alike, Natfoods has taken steps to mitigate those.
“We receive a relatively stable supply from Zesa (national power utility), and most of our plants have backup generators,” he said.
“Here at Aspindale, we are also installing a solar plant. In the next three to four months, this facility will be powered by solar energy during daylight hours.”
Lashbrook said while challenges existed for firms in the industry, such as regulatory bottlenecks, delayed payments, liquidity, and forex challenges, the firm tried to focus on the positives and the opportunities.
“We were able to discuss some of the challenges quietly, and we are confident the authorities will take those into consideration,” he said.
“Overall, we are optimistic about the future, which is why we are investing so boldly in Zimbabwe.”
Natfoods officially delisted from the Victoria Falls Stock Exchange on January 31 to streamline its operations and concentrate on long-term strategic objectives.
