CBL consolidates in agri-food industry

CBL markets a range of products under the brand name Prosoya with Samaposha being the flag bearer of the company. Health food drinks like Mung Shakthi, Soya Brew and Kolakenda in sachets are increasing in popularity. Samaposha is an energy food rich in Protein, fat, fiber carbohydrates and vitamins is popular with garment factory employees, school children, campus students, pregnant and lactating mothers and blue collar workers primarily drawn from the middle income and lower income groups.

Sri Lanka’s top biscuit maker, is consolidating its position in the agriculture-food industry with a series of strategic moves and acquisitions.

Ceylon Biscuits Ltd (CBL), said in a statement it supported the sourcing of local primary produce for its production process and backward integration with the farmers being positively looked at – with the acquisition of the Cecil Food Company a few years ago.

The acquisition of Cecil, one of the largest fruit and fruit based product exporters of Sri Lanka, followed with an 80 percent stake in Plenty Foods (Pvt) Ltd, which began operations in April 1996, now involved in the propagation of soya products in Sri Lanka.

Backward integration
The company said it provides financial assistance to farmers for the purchase of seed and fertilizers through a tripartite arrangement with banks, farmers and the company. The Central Bank provides funds up to a maximum of Rs.150 million through its New Comprehensive Rural Credit Scheme (NCRCS) at an attractive interest rate. The company also enters into a forward sale contracts with farmers for the purchase of grain at an agreed confirmed price.

This ensures guaranteed profits to farmers.

CBL markets a range of products under the brand name Prosoya with Samaposha being the flag bearer of the company. Health food drinks like Mung Shakthi, Soya Brew and Kolakenda in sachets are increasing in popularity. Samaposha is an energy food rich in Protein, fat, fiber carbohydrates and vitamins is popular with garment factory employees, school children, campus students, pregnant and lactating mothers and blue collar workers primarily drawn from the middle income and lower income groups.

The company aims to enlarge the out growers network and by the end of 2008 to increase the farmers base to 12,500. Soya being earmarked for cultivation and extraction of oil, lecithin and de- fatted meal- the primary raw material for its Lanka Soy factory –market leaders of TVP.

CSR
In addition to the financial viability the CBL group considers this project as a primary Corporate Social Responsibility programme, while Cecil Foods has a small backward integration programme to purchase organic fruits, and other products from the farmers and would expand this project.

“The farmers don’t default on their obligations when at certain instances they are offered better prices.

The company spends considerable sums of monies seasonally on social activities- repairing village schools, rehabilitation of roads, helping needy children in sports and education activities and thus contributing to re-awaking and up lifting the livelihood of poor farmers.

There is a distinct improvement in the standard of life where backward integration has been implemented,” the statement said.