Norfund, the Norwegian Investment Fund for Developing Countries, has invested $8 million in Redsun Dried Fruit and Nuts, a raisin processor and distributor based in South Africa. The equity investment will be used to expand Redsun's operations with two new state-of-the-art facilities, which will help the company increase its market share in the healthy snack market.
Norfund's growth investment will allow Redsun to double its current capacity by constructing the only raisin processing facility in Vredendal, South Africa's fastest-growing raisin production frontier.
Due to its location in a different intake region with a unique climate close to Cape Town, one of Africa's main ports, Vredendal provides diversification and logistical benefits. Redsun was founded in 2009 and is based in Keimoes (Northern Cape), where 90% of the country's raisins are produced.
Meanwhile, the company is diversifying its dried fruit and nut offering by constructing a new pecan wet cracking facility adjacent to its Keimoes raisin facility, as it seeks to establish itself in the Orange River's fastest-growing crop.
One of the first wet cracking facilities in the southern hemisphere will be built here. The technology has been in use in the United States for more than ten years and produces higher yields than the current dry cracking technology in use in South Africa.
South Africa is the world's third-largest producer of pecans, but it lacks a major pecan wet cracking facility due to historically low pecan production making wet cracking unprofitable.
Pecan production in the country, on the other hand, more than doubled from 2014 to 2021, with production expected to triple by 2030. The investments are expected to more than double Redsun's current workforce of 163 employees, create 200 new jobs, and support over 6,000 indirect jobs.
"By creating jobs and increasing the company's value, this investment in Redsun satisfies our mandate. It also fits with our plan to create jobs locally by processing agricultural products. "The company and the region will benefit greatly from the new pecan wet cracking and raisin processing facilities." "We're looking forward to working with an experienced management team and taking advantage of 1K1V's access to Three-Dimensional Capital," project manager Andre Kemp said.
The company has a competitive advantage at a critical juncture in the international raisin and pecan industry, as production in the United States is declining while demand is increasing globally. The production of raisins in South Africa has increased dramatically over the last ten years, and this trend is expected to continue.
