Africa Plantation Capital, a company that owns several plantations in East Africa, has entered into a bamboo biomass supply agreement with Bidco Africa Group, a consumer goods multinational based in Thika, Kenya. Bamboo biomass will be used to produce energy to run Bidco Africa Group's plants in Kenya and East Africa.
“The most important aspect of this memorandum of understanding is the commitment of Bidco Africa Group and its employees to an environmentally responsible policy. The group has circular business models and we are now ready to invest in providing bamboo as a source of green and sustainable energy,” said Kosta Kioleoglou, CEO of Africa Plantation Capital, the African branch of Asia Plantation Capital. The company has just signed an agreement with Bidco Africa Group to supply bamboo biomass to Bidco Africa Group, a company specialising in the supply of consumer goods (edible oils, fats, margarine, laundry and detergents, personal care products, animal feed, etc.).
Africa Plantation Capital will supply at least 200,000 metric tons of bamboo biomass to plants in Kenya and Uganda over the next five years. This volume represents $10 to $14 million in annual sales. To achieve this goal, Africa Plantation Capital, with the support of Asia Plantation Capital Group, is now investing in a collection centre with a drying and shredding facility to meet the demand for dry bamboo biomass in Kenya.
A beneficial project for local populations
According to Vimal Shah, the president of Bidco Africa Group, his company, which has 1,800 employees, needs at least 200 tons of dry biomass per day, or more than 60,000 metric tons per year, to cover the energy needs of the Thika plant alone, a city located 40 km north of Nairobi, the capital Kenya. To fulfil its part of the contract, to supply Bidco Africa Group’s biomass plants in Kenya and Uganda, Africa Plantation Capital needs to use external suppliers.
The company therefore decided to integrate the local populations in this rather profitable operation. The company, which employs 100 full-time (and 150 part-time) employees, plans to involve Kenyan farmers in bamboo production, offering purchase contracts for a minimum of 15 years to growers. The company also plans to invest $1.2 million, notably to develop its biomass plants.
This project will enable Bidco Africa Group to limit the use of wood as an energy source. A boon for the Kenyan government, which is very committed to the fight against deforestation. Both companies have declared their intention to support the 10% forest cover target set by Kenya’s President Uhuru Kenyatta for 2022. To reach it, 1.8 billion trees will have to be planted over the next five years.
Jean Marie Takouleu