Seprod to launch flour mill
In a matter of months, food manufacturer Seprod Limited will enter a market that has had a sole player for decades, the manufacture of flour, under partnership with a foreign firm that acquired a piece of its grains business more than a year ago.
Through Jamaica Grain & Cereals Limited, the partners have already poured funds into a new factory and development of grain silos on the wharf to facilitate imports of wheat, and at the plant on Felix Fox Boulevard in Kingston.
The overall budget for the project was not disclosed, although Gleaner Business was told that the spend could rise to around US$30 million, or $3.9 billion in local currency.
Seprod CEO Richard Pandohie says the factory should be commissioned by around end September or October, but he refused to confirm outright that the company is planning to operate a flour mill. He has not named the new foreign partner for Jamaica Grain, but Companies Office records suggest it might be American shipping and trading company Seaboard.
Well-placed sources say Seprod is now planning to produce wheat flour, in addition to cornmeal, which Jamaica Grain has manufactured for half a century.
It would be the second flour mill to operate in Jamaica. The other, Jamaica Flour Mills Limited (JFM), which is owned by American company ADM Milling, also operates from Kingston and has been around since 1964 when the company was established under the 'industrialisation by invitation' policy of the Jamaican government. ADM bought the business in 1997.
It means that local bakers will have a second large domestic source of raw material. Under the current market configuration, nearly all flour used commercially in Jamaica is supplied by JFM, with token amounts imported by traders.
A permit was just granted to Seprod by the National Environment & Planning Agency in March, for operation of the facility that has been under development for around 18 months at the industrial company's complex and adjacent property at Newport East.
Pandohie says the company is holding back on details of the project for a full announcement next week at Seprod's 78th annual general meeting.
"The chairman of the group will make an announcement ... we can't say any more at this time but he will be sure to expand on what is already in the public domain," he said.
Pressed as to whether the new plant would process both flour and corn, Pandohie said he would leave such comment to chairman Paul 'PB' Scott.
In late 2015, Seprod sold 50 per cent of Jamaica Grain to an unnamed joint venture partner. A review of Companies Office records indicate that since then, three new directors joined the board Steven Bresky and David 'Dave' Dannov of Kansas, United States, in October 2015; and James Marks of Haiti in March 2016.
Bresky is listed on Bloomberg.com as the CEO and president of Seaboard Corporation since July 2006, as well as manager of Seaboard Flour since 2006. He previously served as CEO of Commodity Trading & Milling at Seaboard Corporation.
Bloomberg also lists David M. Dannov as president of Seaboard Overseas Trading Group, a division of Seaboard Corp since August 2006, and that he is the current CEO of Commodity Trading & Milling at Seaboard Corp.
James Marks is listed by lenouvelliste.com as the head of Moulins d'Haiti, an affiliate of Seaboard that deals in wheat flour.
With the sale of half the company, Seprod reclassified Jamaica Grain from a subsidiary to a joint venture. It remains the managing partner, but shares joint decision-making with the new owner.