Mahalapye cooking oil dream dies

Dream denied: Some of the Lupro oil produced in Mahalapye
Dream denied: Some of the Lupro oil produced in Mahalapye

Lupro Pty Ltd, a sunflower oil-producing company based in Mahalapye, is up for sale after 12 years, as its founder says lack of support by various levels of government has finally crippled operations

Christopher Nakabale told BusinessMonitor that despite promises made at top government level to support local manufacturing, Lupro had failed to secure any business over the years, while debts and running costs were piling up. Lupro, a wholly citizen-owned business, purchases sunflower seed from the Botswana Agricultural Marketing Board (BAMB), presses, refines and packages this into sunflower oil. The Mahalapye factory is capable of producing 30,000 litres per week. While the sunflower oil company has squeezed into shop shelves in the country’s retail sector over the years, securing government supply contracts, such as those for schools and clinics, was required to keep it afloat. “I’m selling my factory because what’s the point,” Nakabale said on Thursday. “I have been to all the government structures, all the way to the Ministry of Finance and I have not received any help. “I have been everywhere in government and I have said I’m not asking for more money. “I just want access to what you are spending in South Africa.” Nakabale alleged that over the years, government supply contracts were frequently given to preferred bidders who were politically connected.

This, he said, was even done when the bidders were not producers but local companies importing from outside the country. “I suspect tenders are pre-awarded and they only come to us when they are in trouble. “They have their preferred suppliers and when these let them down, they come to us. “I’m in Mahalapye, but I don’t supply the schools here even though the Ministry of Local Government permanent secretary directed them to give us manufacturers the preference.” The businessman said Lupro once came close to securing a lucrative supply contract with government but was again foiled by bureaucracy. “The Ministry of Local Government gave me a tender to supply and I said please adjust your prices because the inputs have gone up,” he said. “BAMB had doubled the prices of sunflower and I showed the council and said please give us a commensurate increase. “I instead found myself caught between two related government entities and I was supposed to produce and supply at a loss. “They said to produce it below cost and I said how?” Lupro’s troubles come at a time when government is considering restricting the importation of cooking oil. The ministries of Agriculture and Entrepreneurship have confirmed that they are analysing local sunflower and safflower production, value chains and distribution lines, to possibly restrict cooking oil imports. In addition, this week, Finance ministry documents released as part of the 2023–24 budget indicate that under the value addition priority, government intends to build a sunflower refinery plant. The value addition priority has been given a provisional P541 million budget and also includes other value addition initiatives such as those in minerals and agriculture. “We have been producing for 12 years and what government is proposing now, we have been proposing for the past 12 years,” Nakabale told BusinessMonitor.

Editor's Comment
Mind your health

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