Agreement Signed for Rice Processing Plant

An agreement for the supply of a rice processing plant to be established in Gambella and Debrezeit with an investment of Birr 350 million, was signed on February 15, 2010 between Saudi Star Agricultural Development Plc and Satake Engineering Plc at Sheraton Addis by Ato Haile Assegide, Director General of Saudi Star Agricultural Development Plc, and Shoichi Tanaka, President of Satake Engineering Plc, respectively. 

According to the agreement, Satake Engineering Plc would provide transfer of technology as well as machinery to Saudi Star Agricultural Development Plc. Satake Engineering Plc is an international Japanese Company well known for rice processing technology. The agreement will enable Saudi Star Agricultural Development Plc to process rice being developed through its project in Gambella Region.

This agreement, an acquisition of a new technology to process rice in Ethiopia, is part of the first underpinning in achieving the overall goal of one million tons of rice per year. Rice is expected to be produced at the end of the year by Saudi Star Agricultural Development Plc, the newly established member of the MIDROC Ethiopia Group.

Ato Haile Assegide stated at the signing ceremony that the contract is not just a supply contract, it is a partnership contract with Satake International, which will not only supply the plant and the technology, but will also be a partner in developing rice in Gambella as well as in other parts of the country.  Ato Haile also stated that the partnership between the two companies marked the beginning of the transformation of his company to become the largest rice producer in the country and would also be an eye-opener for others towards scaling up Ethiopia’s food exports.

Ato Haile in addition noted, the company envisions that besides exporting the rice to the Middle East 45% of the production would go for local consumption.

In relation to whether farmers were being uprooted by the development, Ato Haile explained that the company has prioritised investing in areas that are uninhabited as the primary goal is to invest in areas where no one would be uprooted. He further explained, in the event it happens, the project has a provident fund and compensation scheme that will cover the costs of relocation and maintain the households previous income as well as look towards supporting and integrating them within the operations of the company.

Saudi Star Agricultural Development Plc planned to develop about 500,000 hectares of land in Ethiopia over the next 20 years including sugar, oil seeds and grain production.

Currently, all required agricultural and construction machinery and equipment are already put in place for the Project in Gambella.

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