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Monday, November 28, 2011


Working with Agland Investment Services, Inc. and The Louis Berger Group, we have successfully completed a short technical assistance mission with the USAID Inma (Ar. Growth) Agribusiness Program. Based in Baghdad this Program covers the entire country and has had great success in developing in particular the livestock and horticulture sectors.

Iraq produces about 1 million tons annually of various fruits - grapes, pomegranates, apples and oranges are the main ones.   The bulk of the production is in the north (known as Kurdistan, an autonomous province with some distinct differences from the Arab south).  The focus of this one month mission was to look into the feasibility of converting some of the apparent seasonal surpluses of fruit into juice.

Our mission modelled a small-scale process line of just 24 tons/day of fresh fruit input and produced a 100% juice drink along with a pulp-based "fruit drink".  We looked in detail at both the technical aspects of putting together a factory (raw material supply, location, buildings, machinery, packaging etc.) and the financial aspects of cash-flow and return on investment (ROI).

The bottom line seemed to be that while Iraqis drink fruit juice in copious amounts (the photo illustrates a street level "juice bar"), much of it is in the form of "fruit juice drinks" imported from neighbouring countries like Iran and Turkey.  Our spreadsheet model provided a theoretical positive ROI but this would be in a very competitive real-world market and where the fresh fruit price might in fact be too high for a stand-alone factory to be profitable.

Nevertheless, we are looking at other implementation options and we hope this may result in another mission in the New Year. What we hope to find is an Iraqi investor who is already in an existing beverage business (perhaps water bottling) who wishes to add a product line and perhaps grow his own supply of raw material.

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