Mitsui-Behn Meyer JV to establish fertiliser business in Myanmar
BMM Venture, a newly founded joint venture (JV) between Japan-based company Mitsui and chemicals distributor Behn Meyer (BM), has entered into an agreement with Myanmar Agribusiness Public (MAPCO) to establish a new company, Agri First (AFC), to manufacture and distribute imported fertilisers in Myanmar.
Established in 2012, MAPCO is involved in the agriculture sector in Myanmar.
As part of the plan, AFC expects to invest nearly JPY1.2bn ($184m) to build a fertiliser manufacturing plant, including a warehouse and other related facilities in the Thilawa Special Economic Zone.
The proposed plant, with a 100,000t annual capacity, expects to be operational by next year.
Holding around 1.8 times more land than Japan's, Myanmar has nearly 2.8 times more farmland in its possession, and its climate and water resources are suitable for double-cropping.
With expectation to grow the agricultural sector because of these reasons, the country's current demand for fertiliser stands at over one million tonnes, which is equal to only one-fifth of the level in countries with similar farmland areas and crop types, including Vietnam and Thailand.
By establishing AFC, Mitsui, BM and MAPCO plan to contribute to agricultural development in Myanmar.
For setting up AFC, BM will render its expertise and experience relating to the manufacture and distribution of specialty fertiliser, while Mitsui will provide financing, logistics, procurement and marketing capabilities.
MAPCO's networks with agricultural business operators in Myanmar are expected to help AFC.
Mitsui said it is currently focusing its business development endeavours toward the consolidation of the seven key strategic domains identified in its new medium-term management plan, and the latest initiative is expected to boost the company's presence in the food and agriculture sectors.
Further, the JV with BM is expected to provide Mitsui an opportunity to enhance its business operations in fertilisers and agricultural materials sectors in Myanmar, as well as other southeast Asian countries, apart from its business in Japan, Europe, and North and South America.
The JV also aims to increase the growth of scientific methods developed by both Mitsui and BM individually, including guidance on fertiliser optimisation based on soil and crop analyses.
Image: Fertiliser manufacturing facility of BM Group in Malaysia. Photo: courtesy of Mitsui & co ltd