Olam International, the global, integrated supply chain manager of agricultural products and food ingredients, say it will invest US$31.5 million ($44.7 million) to set up a greenfield 500 tonne wheat mill near Port Tema, close to the largest flour market in Ghana.

Olam plans to start construction of the wheat mill in March and commission the plant by September. The company aims to achieve 115,000 tonnes in annual flour production in three years (by FY2014) and become the third largest wheat milling company in Ghana. The mill is expected to turn in US$64 million in revenues and US$14.9 million in EBITDA by that time, and generate a project IRR of 25%.

Olam says Ghana is a large market for wheat flour in West Africa, consuming 270,000 tonnes annually. Wheat milling is attractive in Ghana as consumption of wheat flour is expected to rise 7.5% per year over the next five years, the country imposes tariffs on flour imports and the oligopolistic nature of the industry.