May 4 , 2025. By AKSAH ITALO ( FORTUNE STAFF WRITER )
Key Takeaways
Heineken Ethiopia is investing 26 million euros in its Qilinto brewery, a move that will accelerate the Dutch company's rise to dominate Africa’s second most populous country and consolidate its regional reach.
The money is split between new brewing hardware and a switch to electric steam, both raising production and cutting costs, but most notably shrinking the plant’s carbon footprint. Management says the upgrade, due to be finished in November this year, will lift Qilinto’s annual output by 20pc to 4.5 million hectolitres within three months of startup, while giving the company a national capacity of 5.5 million hectolitres adding steady volumes from its smaller Harrar and Bedele sites.
The expansion centrepiece is a six-million-euro order for three brewhouses and mash cookers, which will increase daily throughput from eight to 12 batches.
“Our plan is big for Heineken,” said Bart De Keninck, general manager of Heineken Ethiopia Plc. “It’s a first of its kind on the continent’s brewery scene.”
Engineers hired through Niras, a Danish consultancy firm, broke ground last year. The civil work is largely complete, and installation teams are expected to begin installing new vessels in late May.
Qilinto’s second pillar is a 20 million euro electric boiler system that will replace imported heavy fuel oil burners. The setup draws grid power to turn water into process steam, cutting foreign exchange needs and trimming the site’s greenhouse gas tally.
“The shift to electric energy is not just about efficiency,” said Alemayehu Gashaw, the plant’s general manager. “We're complying with zero carbon goals.”
The state utility has promised uninterrupted supply for the 25,000Sqm complex, whose refrigeration and packaging halls already draw peak loads of more than 10Mw.
Heineken’s push comes as the beer market, once a footnote in African brewing, has swelled to 21 million hectolitres of installed capacity run by five players: BGI Ethiopia, Heineken, Dashen, Habesha and United Beverages. The industry began in 1922, when St.George beer rolled off a small line under Emperor Haileselassie. A century later, the brands number more than 20, and Heineken holds roughly 40pc of sales with labels such as Walia, Harar, Bedele Special and its flagship Heineken.
The company entered the country in 2011, acquiring Harrar and Bedele breweries from the government through privatisation, then broke ground on Qilinto in 2015.
Hieneken executives say they moved rapidly to rely on Ethiopian grain. A decade ago, only three percent of its barley was sourced locally; today, the share is 100pc. Local taxes have grown in step. Heineken Ethiopia Plc paid 14 billion Br in 2024/25 alone. Yet, the pledge to buy domestic grain has collided with a shortage that sent barley prices to 14,000 Br a quintal in April, more than double the going rate two months earlier.
“Barley is critically important to us,” said De Keninck, who also chairs the Ethiopian Beer Producing Industrial Sectoral Association. “Prices are a growing concern to us.”
Shortfalls have rippled through the supply chain. Brewers need more than two million quintals annually, but maltsters say they cannot secure enough raw grain. Mekonnen Abera, general manager of state-owned Assela Malt Factory, usually buys 4,000 quintals daily; lately, he has received about half that.
“We had no choice but to raise prices,” he said, noting that household demand for barley as a food staple has jumped, further tightening supplies.
Farmers argue that the spike merely reflects their own soaring costs.
According to Girma Kebede, a 50-year-old grower in Arsi’s Bokoji district, fertiliser prices reached 9,500 Br a quintal, and improved seed prices climbed to 8,000 Br.
“We had to hold our stock until the market caught up,” he said after selling part of his 2,000Qtl harvest at 11,000 Br.
“Increasing prices were inevitable,” Girma told Fortune.
He recalled that malt and brewery buyers initially baulked at paying more, prompting many growers to sit on inventory for weeks.
The standoff alarmed industry executives and pushed the brewers’ lobby to seek help from the Ministry of Industry. A task force led by State Minister Hassen Mohammed summoned farmers’ unions, maltsters and brewers to negotiate.
“Improvements have been made in the supply,” said Amarkegn Em’kulu, who heads the Ministry’s input desk, though he conceded that “price pressures persist.”
Discussions are continuing, and the matter is slated for review by the Prime Minister’s macroeconomic committee, chaired by senior adviser Girma Birru.
“The committee is taking the issue seriously,” Amarkegn said. "Studies are still ongoing.”
Consultants believe technology and careful sourcing are the way out.
For Gemechu Waktola (PhD), a strategy and human capital adviser, firms that ignore efficiency and environmental standards will fall behind rivals.
“It’s no longer a choice," he told Fortune. "It’s about survival.”
He urged breweries to support growers with better seed, extension services and guaranteed purchase contracts so that imports become “the last resort.”
PUBLISHED ON
May 04,2025 [ VOL
26 , NO
1305]
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