After the successful launch of its first dairy farm and the 9 Mile Highlands Produce Depot last year, Innovative Agro Industry has four major expansion projects underway for 2019. Business Development Manager, Gallit Tamir, tells Business Advantage PNG, they include a second dairy farm, a frozen French fries processing plant, and large-scale coffee, cocoa, grain, stock feed processing and poultry production projects.

Ilimo milking facility Source: Innovative Agro

The K128 million Ilimo Dairy Farm just outside Port Moresby is perhaps Innovative Agro Industry’s (IAI) most high-profile project since it came to PNG in 2011.

The farm, which has a herd of 800 cows, and employs and trains 200 locals in dairy production, opened early last year.

Its milk sells in Port Moresby and Lae for half the cost of imported milk.

The farm produces an average of 6,000 litres per day, supplying the market with a variety of products such as fresh milk, flavored milk and the Ilimo Milk Stik.

The success of fresh milk and low prices saw IAI lodge a formal complaint last September that foreign dairy producers had lowered the price of their 1-litre UHT milk to some Port Moresby retail outlets below the landed cost, while costs for the same products in Lae and other parts of the country remained the same and even increased.

The case has yet to be resolved.

‘One of the key drivers for developing the agriculture industry generally, is to strengthen food security in rural locations,’ Tamir has told Business Advantage PNG.

‘We have developed a model that empowers entire communities and provides an avenue for many to meaningfully participate in the dairy industry.

‘Our greatest challenge in the beginning was educating consumers about the differences between UHT and fresh milk. Our product is the superior fresh milk, which needs to be stored appropriately.’

Commercial dairy

During 2019, Ilimo will begin producing ice-cream, yoghurt and dairy snacks.

It is preparing to build a second commercial dairy at Yalu in the Huon Gulf District of Morobe Province.

‘Feed is one of the most expensive inputs in the (dairy) production process, because most of it is imported,’ Tamir says.

A pilot project to develop a maize outgrower program for Central Province farmers has begun and she expects a full-grown maize program will eventuate this year.

The opening of a new processing and distribution depot for Highlands farmers at Nine Mile Farm in Port Moresby will see more PNG-grown vegetables in shops in Port Moresby and even Singapore, as the Enga-grown strawberries have received interest from International buyers.

‘Potatoes will be sourced from not only local Ialibu–Pangia District farmers, but from the region, changing the livelihood of thousands of farmers in Southern Highlands, Enga, Western highlands and beyond.’

‘International food safety certification last year was a big win for us,’ she says.

‘Our strawberries from Sirunki Farm in Enga debuted last year.

‘They have an incredible flavour profile and are a premium product that we can now export to foreign markets because we have reached this important globally-recognised safety standard.’

Would you like fries with that?

Another long-term aim is to replace imported agricultural products with locally grown and produced dairy, vegetable and poultry products, and expanding coffee and cocoa farms.

Ilimo dairy will replace about one-third of the country’s 14-million litres of imported dairy.

Locally-produced potato chips—or French fries to some—are a vegetable priority for 2019, says Tamir.

‘About 4,000 tonnes of French fries are imported annually and we plan to replace that amount by 2020.’

‘The factory has a weekly requirement of 80 tonnes of raw potatoes for operation. Potatoes will be sourced from not only local Ialibu–Pangia District farmers, but from the region, changing the livelihood of thousands of farmers in Southern Highlands, Enga, Western highlands and beyond.

‘This will be nothing short of revolutionary for the potato farmers of the Highlands.’

Roots, coffee and more

The venture is also looking to process taro and other sweet potatoes to expand to export markets.

Over the next five years, IAI, in partnership with ExxonMobil, Mineral Resources Development Company (MRDC) and the District and Provincial Administrations of Hela Province, will look to rejuvenate the coffee industry in Hela Province, planting 15 million new coffee trees, as well developing a maize program to provide feed to a three-year old egg layers farm in Koroba and the poultry farm in Piwa.

2019 will also see a K30m commercial farming project in the Yangoru-Sausia District of East Sepik, partnering with the District and Kumul Agriculture.

‘The project in Sepik will create 140 direct employment opportunities and thousands of out-grower opportunities,’ she says.

‘The project will begin with the development of an Agro Industrial Centre focused on cocoa, grain production, stock feed processing and poultry production. The facility will also feature a cocoa-drying and processing facility.

‘The poultry production farm will cater for the local market and supply meat and eggs as a source of fresh protein to both East and West Sepik.’