ISLAMABAD - Cargill and Fauji Foundation have entered a long term strategic partnership in Pakistan to strengthen agricultural supply chain in the country.
With this investment, Cargill has taken a minority equity stake in Fauji Akbar Portia Marine Terminal Limited (FAP), Pakistan’s leading bulk terminal, and will handle grains, cereals, rice, oilseeds and fertilizers at Port Qasim. Fauji Foundation, through this partnership with the world’s leading agriculture company, will transform FAP’s supply chain to enhance overall value for all stakeholders including suppliers, customers, employees and shareholders.
This is Cargill’s first investment into Pakistan, after the strategic intent announced in January 2019 and reflects its long-term commitment to the country. Cargill made an announcement in 2019 regarding investing US$200 million in the country. Cargill is already a leading soybean and palm supplier in Pakistan and will further strengthen its presence as a significant agri-importer, while enabling FAP to leverage Cargill’s extensive experience in bulk handling, port operations and its technical know-how. Combining Cargill’s customer centric approach with FAP’s operational excellence will help support customers better. Going forward, both partners aim to build a safety culture that will create a world class, safe and sustainable environment for FAP’s employees and customers.
Fauji Foundation Chairman, Waqar Malik stated: “We are excited to have Cargill join hands with us at FAP Terminal, Port Qasim. To conclude this transaction at this point in time is a clear signal and validation of the Pakistan opportunity seen by the world’s leading player in agriculture commodities. With its global port experience, Cargill will help drive greater operational efficiencies for the port to reach its potential of handling agri-cargo safely and efficiently. Fauji Foundation is building on its agricultural and infrastructure sector presence to help solve the pressing needs of our country for efficient and affordable nutrition through enhanced farmer productivity.”
“We are proud to partner with Fauji Group in this venture. Fauji Foundation, along with other shareholders, have grown FAP into a key terminal for agricultural commodities over the last decade. We will, together, position the company for its next stage of growth and profitability. This further adds to our global port operation’s footprint and strengthens our agricultural trading and supply chain operations in the region. It is a demonstration of our commitment to partner in the economic growth of Pakistan by bringing in our global expertise and investment. In future we will also look at opening doors for other sectors where we can add value, besides exploring business synergies with our existing partners,” said Imran Nasrullah, country president, Cargill Pakistan.
FAP is the only modern grain terminal in the country and handles around 2.5 MT of imports annually. These imports are expected to further grow in tandem with the demands of a large population. A large portion of these imports include soybeans, which are crushed locally and have resulted in a large domestic oilseeds processing industry. It is therefore imperative that the port runs its operations as efficiently and effectively as possible.
Cargill has a lot of experience in handling port operations and can help Fauji Foundation improve the efficiencies at the port and further modernize the operations using learnings from ports around the world.
It might be mentioned here that Cargill has been operating in Pakistan since 1984 and has been involved in trading commodities such as wheat and cotton. Today Cargill’s operations comprise of refined oils, trading and handling of animal feed, grains & oilseeds, cotton, sugar and metals. Animal health business is based in Lahore, which is involved in selling specialty premixes, additives and other nutrients to feed mills in the Punjab region. According to the Cargill, it is interested in exploring options in commodity trading, feed milling, dairy and poultry processing, oilseed crushing etc. The decision to invest in a particular area is only made after each option is studied thoroughly. “We will continue to find the right opportunities in the country in which can add value and significantly improve our presence in the country,” it added.