Small, Micro and Medium scale cereal milling has come along way since industry deregulation in 1996. Initially defined by hammer and stone mills, this previously limited market has grown exponentially to include numerous new milling entrepreneurs as well as suppliers of high technology, fully automated roller milling plants designed specifically for this market segment. (Milling capacities of under 5 tons/hour fall under the small and micro sectors, whereas medium scale can be defined as volumes of up to 10 tons per hour).
Typically corporations such as Tiger Milling, Premier and Pioneer Foods make use of large-scale, high-volume milling plants (up to 60 ton/hour capacity) to produce their milled products. Until deregulation, it was not considered commercially viable for small scale mills to succeed. Today there are several successful examples of smaller independent millers operating in this field.
Many factors have come into play in changing this perception and the materialisation of small scale, high technology (high returns) milling operations. Probably most significant is the ever-increasing logistics costs, causing businesses to source and sell products locally or to take a closer look at their burgeoning distribution network costs. Other sources include:
- Figures published by the National Association of Maize Millers show that maize milling in the year ending April 2009 was 14% higher than the figures of the previous year at 2.7mt. (Considering that the NCM represents only 50-60% of the maize millers in South Africa, the increases are likely to not only be more substantial than initially reported, but also as a result of the upsurge in small-medium producers).
- Cereal surplus in South Africa means increased opportunities for agro processing sectors. The SADC Food Security Assessment for the 2008/2009 marketing year indicated a total cereal surplus for South Africa of 1.60 million tons.
- An increasing demand for specialised, niche-market products (such as Italian breads or Pizza for example) has also lead to an increased demand for smaller production runs of specialised milled products.
- Increasing population requiring increasing quantities of staple foods both locally and internationally in neighbouring SADC countries.
- The recent economic downturn has resulted in the majority bulk population shifting to a necessary preference for basic, affordable food staples as apposed to ‘luxury' food items.
- A strategy document compiled by Government and major milling industry players during the brink of the deregulation period sought to empower SMME's and BEE's within the agro processing sectors. This attitude of empowerment has assisted in paving the way for a deregulated, competitive milling industry with ample room for contenders of varying levels through minimised entry barriers.
African Micro Mills (PTY) Ltd was established in 2004 and specialises in driving profitable entrepreneurial grain milling and basic food production in Southern Africa. In addition to offering high-level, global-technology small/micro/medium cereal milling plants; a full advisory, training and mentorship service is available from project inception through to established production supply networks. With over 250 years of combined local experience, their team of industry leaders has expertise in areas of grain milling, baking, raw material procurement, food science, starch and product variant options, accountancy, marketing, sales and business management.
Other small to micro mill equipment supply companies include Drotsky, ABC Hansen, Maximill Roller Mills, Plantkor and Roff Industry (previously Snell Africa).
A list of small millers is available from the National Chamber of Milling and the Association of Maize Millers.
