Case study

Developing Namibia’s local barley industry

Inspired by the O&L Group’s purpose of Creating a Future, Enhancing Life for all Namibians, NBL initiated barley trials in 2010 with the ambition of establishing a local, large-scale barley industry. It was envisioned that this will create employment, support local business and develop Namibia’s agricultural sector.

Partnering to ensure business sustainability and local economic growth

In accordance with the Reinheitsgebot, high-quality malted barley is a key ingredient in NBL’s beer brands. It is also a key ingredient in its non-alcoholic soft drink, Vigo.

Beyond being used in production by NBL, barley is a versatile crop with a high nutritional value. It can be used in breads, soups, stews and salads, with by-products used in animal feed. Barley is therefore a valuable addition to both Namibia’s agricultural and manufacturing sectors.

As such, the development of a local barley industry provides a significant opportunity to support ‘Growth at Home’ and strengthen the Namibian economy. It will also enable NBL to reduce its reliance on imported malted barley and instead procure this critical ingredient locally.

Inspired by the O&L Group’s purpose of Creating a Future, Enhancing Life for all Namibians, NBL therefore initiated barley trials in 2010 with the ambition of establishing a local, large-scale barley industry. It was envisioned that this would create employment, support local business and develop Namibia’s agricultural sector.

NBL subsequently invested substantial resources in barley trials. Since commencing trials, the Company has invested more than N$5 million in planning, execution, seeds, laboratory and brewing trials, as well as shipment and logistics.

This extensive research proved that a Namibian barley industry was possible. However, to achieve this vision, NBL recognised the need for a partnership approach. The Company entered into discussions with Government about the potential alignment of its vision with Government’s green-scheme initiative.

This initiative encourages the development of irrigation-based, agronomic production to increase the contribution of agriculture to Namibia’s GDP. The initiative also aims to achieve the social development and upliftment of communities located within suitable irrigation areas.

In 2015, NBL concluded a tripartite agreement with the Ministry of Agriculture, Water and Forestry, as well as the Agricultural Business Development Agency (AgriBusDev), to develop a local barley industry in partnership with Namibia’s green-scheme farmers.

More than only beer: King Lager, truly Namibian

NBL’s ultimate goal is to secure its barley supply locally and reduce reliance on imported raw material. This would necessitate that NBL invest in a local malting plant.

NBL further recognised its role in creating a demand for unmalted barley in order to contribute to the long-term development and viability of the local barley supply chain. The Company subsequently identified the opportunity to launch a ‘home-grown’ beer brand made from locally grown, unmalted barley.

As it is envisioned that this barley will ultimately be used to produce all of NBL’s brands, the Company sought expert advice to select the correct barley variants for harvest. Six of these variants – the European summer barley variants – were selected and planted, two of which were identified for future use.

After testing and piloting barley seed varieties in different environmental conditions, the first small batch of barley was harvested for brewing in 2012. In 2013, NBL produced the Independence Brew from home-grown barley for Namibia’s 23rd independence celebration. Described as ‘bold and full bodied’ the local brew was well received and so King Lager was born, finding its way into the local market in September 2015.

To ensure that the crop meets NBL’s standards for brewing quality, samples of harvested barley are sent to an independent, third-party laboratory for stringent testing of the barley’s protein content, the size of the grain and the germination energy.

In addition, barley is a seasonal crop that is planted in winter. Before NBL’s partnership with Government’s green-scheme initiative, only wheat was harvested. Barley provides an ideal off-season crop to complement the farmers’ baskets.

Looking to the future: a 10-year plan for prosperity

The cropping programme for 2016 was 10 times that of the previous year. The crop, planted in June 2016, was harvested roughly five months later and provided a yield of approximately 3.8 tons per hectare. The cropping programme for 2017 was started in May 2017.

To demonstrate its long-term investment in growing Namibia’s local barley industry, NBL has committed to the 10-year Barley Industry Development Plan. Implemented in partnership with the Ministry of Agriculture, Water and Forestry, as well as AgriBusDev, the desired outcome of this plan is to establish a sustainable barley industry. This would translate into the creation of additional job opportunities in rural agricultural sectors within Namibia – a major contributor to the Group’s vision of creating 4 000 additional job opportunities by 2019.

The 10-year Barley Industry Development Plan also supports Government’s Vision 2030, the Harambee National Prosperity Plan, as well as its ‘Growth at Home’ strategy – all of which are aimed at alleviating poverty and unemployment in Namibia.