Towards establishing a Niger seed semi-oil refinery factory and optimizing the Niger seed value chain

Haragu is located at Kombolcha town, Horo-Guduru Wollega zone of the Oromia National regional State, 275 km away from Addis Ababa towards Ambo. The cooperative Union was established in June 2001 as a multipurpose cooperative Union with 10 legally registered primary agricultural cooperatives from four Woredas. Presently, the union is comprised of 57 primary cooperatives. In the union working area Maize, Wheat, Niger Seed, Sesame, Rape Seed, Linseed and Pulses are produced. Currently, the union has given a priority focus for Niger seed crop production due to its favorable growth conditions in the area. Hence, the union has the ambition to invest in a Niger seed edible oil semi refinery factory in order to add value to the produce and provide affordable quality cooking oil to the members. With this objective in mind, a detailed a feasibility study on Niger seed edible oil semi processing factory investment has been conducted in 2015 with the technical support of Agriterra. The study showed that investing in Niger seed oil processing activity is a very attractive business for the union. Therefore, union has already decided to go for an investment. The investment requires 25,636,000 ETB (almost 1 million euro). However, the union does not have sufficient own capital to make the total investment. Therefore, the union would like to borrow 15 million ETB from banks and also planned to capitalize internally 8 million ETB from member farmers to finance the identified investment. In order to get the bank loan the union has also developed a bankable business plan with the support of Agriterra.