Algeria starts maize production, seeks foreign investors

Medium_algeria-wheat
Reuters | 11 December 2014

Algeria starts maize production, seeks foreign investors

By Hamid Ould Ahmed

ALGIERS Dec 11 (Reuters) - Algeria started its first commercial maize production this year and will soon approve applications from foreign investors to boost output and reduce reliance on imports, the head of the country's farmers' union said.

Algeria, the world's fifth-largest grain importer, is seeking to raise domestic production, and its output depends mostly on rainfall levels in the North African state. It imports nearly all of its maize needs and uses it for animal feed.

Official figures show maize purchases from abroad in 2013 reached 3.2 million tonnes at $891.78 million.

"We started maize cultivation in southern provinces. We got encouraging output levels," Mohamed Alioui, head of the farmers' union, told Reuters.

He did not provide a figure for production as the harvest campaign, which started in October, is still underway.

The government has been providing financial incentives, including loans with low interest rates, for farmers who grow grains in a bid to cut the national imports bill.

Algeria's agriculture sector relies heavily on rains, a factor that has severely hit output over the past years due to drought, which cut grain production this year to 3.4 million tonnes from 4.9 million tonnes in 2013.

In a bid to avert the impact of rainfall shortages, the government plans to increase irrigated areas by 1 million hectares to 2 million hectares in the next five years.

"A large part of additional irrigated surface will be dedicated to cereals including maize," Alioui said.

That effort adds to steps to open up the agriculture sector to foreign investment, part of a wider move to diversify the economy which relies heavily on oil and gas.

Two years ago, OPEC member Algeria invited expressions of interest from foreign and local investors to take stakes in pilot farming enterprises. Alioui said firms from the United States, Italy, Britain and Canada had submitted applications to invest in maize cultivation projects.

"They (applications) will be accepted and approved because those firms do have experience and successful investment elsewhere," Alioui said, without naming the firms. "They will help us cut imports." (Reporting by Hamid Ould Ahmed; Editing by Patrick Markey and Mark Potter)
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