SABMiller boosts local sourcing with R700 million investment

26 February 2013

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26 February 2013 | Anna Reynolds

Global brewer SABMiller is investing R700 million (£52 million) in a new malting plant in South Africa to support the local economy and create jobs.

Construction of the new plant in Alrode, Gauteng, will begin this year and will involve local industry in its development. The plant will produce 130,000 tonnes of malted barley a year once it is completed in 2015.

SABMiller’s managing director Mauricio Leyva said: “It makes good financial sense to undertake this investment. It will allow us to reduce our exposure to volatile international markets and replace a significant share of our imported malt and barley with local barley.”

The company currently sources about 65 per cent of its barley locally in South Africa, which will potentially increase to between 90 to 95 per cent once the new plant is operational.

The investment builds on the work SABMiller has been doing with its ‘barley breeding programme’, helping local farmers to develop competitive barley varieties.

SABMiller’s executive chairman Norman Adami said: “It will allow us to drive even higher local sourcing of barley, which will, in turn, help drive the empowerment of small farmers in some of the most poverty stricken areas of South Africa.”

The new plant will be built next to the existing Alrode brewery, which malts about 40,000 tonnes a year. That facility is 40 years old and will be decommissioned once the new factory is running.

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