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Manufacture of Flour and Grain Mill Products
BY Yasmin Mahomedy
South Africa
04 December 2019
R 10 080.00 (ZAR)  
estimated $ 614.82 (USD) *
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Manufacture of Flour and Grain Mill Products


The grain milling sector plays a vital role in food security as its products are the primary ingredients of South Africa’s staple foods, and the sector is a major determinant of the price of maize meal and bread. Pest infestation, droughts and other effects of climate change pose a threat to grain production and in the 2018/19 production season, most summer crop harvests fell due to dry weather conditions at the start of the season.


Rising Costs


The cost of food manufacturing is influenced by the price of raw commodities and by non-food inputs such electricity, labour, packaging material and fuel. Transport and logistics can account for almost 35% of the final cost of maize products, and almost all freight in South Africa is transported by road, which is 30% more costly than rail. Many farmers have had to buy more pesticides as the fall armyworm has caused significant damage to maize and potato crops in some areas. These factors have contributed to the cost of bread increasing above inflation in 2019.


Wheat Imports


About half of the flour used by the bread industry is milled from imported wheat. Imports increased due to the severe drought in 2017/18 in the Western Cape, which affected wheat production. The wheat industry has embarked on a revival strategy to encourage farmers to plant more wheat.


Report Coverage


This report focuses on the manufacture of flour and grain mill products, including the milling of maize and wheat. The report describes the state of the industry and the performance of the major players. There are profiles of 18 companies including the largest vertically-integrated maize and wheat milling companies, Premier, Tiger Brands, Pioneer and Pride and several other millers including Carolina, Godrich and VKB.


Page
1. INTRODUCTION 1
2. DESCRIPTION OF THE INDUSTRY 1
2.1. Industry Value Chain 3
2.2. Geographic Position 4
3. SIZE OF THE INDUSTRY 5
4. STATE OF THE INDUSTRY 6
4.1. Local 6
4.1.1. Corporate Actions 9
4.1.2. Regulations 9
4.1.3. Enterprise Development and Social Economic Development 11
4.2. Continental 12
4.3. International 13
5. INFLUENCING FACTORS 14
5.1. Government Intervention 14
5.2. Economic Environment 15
5.3. Rising Operating Costs 15
5.4. Labour 16
5.5. Land Reform Policy 17
5.6. Changing Consumer Preferences 18
5.7. Environmental Concerns 18
5.8. Technology, Research and Development (R&D) and Innovation 19
6. COMPETITION 21
6.1. Barriers to Entry 22
7. SWOT ANALYSIS 22
8. OUTLOOK 23
9. INDUSTRY ASSOCIATIONS 23
10. REFERENCES 24
10.1. Publications 24
10.2. Websites 24
APPENDIX 1 26
Summary of Notable Players 26
COMPANY PROFILES 29
AFGRI OPERATIONS (PTY) LTD 29
ALGOA ROLLER MILLS CC 33
BAKHRESA SA (PTY) LTD 34
BLINKWATER MEULE (PTY) LTD 36
BRENNER BRANDS (PTY) LTD 38
CAROLINA ROLLER MEULE (PTY) LTD 40
EPIC FOODS (PTY) LTD 42
GIDEON MILLING (PTY) LTD 44
GODRICH FLOUR MILLS (PTY) LTD 46
I L MOLINO CC 48
PIONEER VOEDSEL (PTY) LTD 50
PREMIER FMCG (PTY) LTD 54
PRIDE MILLING COMPANY (PTY) LTD 59
RCL FOODS LTD 61
TIGER BRANDS LTD 67
TONGAAT HULETT STARCH (PTY) LTD 72
VAAL MILLING COMPANY (PTY) LTD 75
VKB FLOUR MILLS (PTY) LTD 76