No investor yet for Rwanda's sole silk factory

Rwanda’s only silk factory is yet to receive another investor years after the exit of Heworks, a Korean firm that was operating the facility until 2021 when it folded operations. In 2016, HEworks Rwanda Silk Ltd, a subsidiary of Korea-based HEworks signed an agreemnt with the National Agricultural Exports Development Board (NAEB) to boost the silk industry in Rwanda. In 2017, the firm’s president and Chief Executive, Barnabas Heechoon Yang, told The New Times that they would make a two-pronged investment approach of $10 million, of which $5 million will be injected in silk farming development and farmers’ capacity building; and another $5 million would go towards building a silk processing factory in Rwanda. The project, which was to be jointly implemented in partnership with NAEB targeted growing sericulture on at least 10,000 hectares, and to benefit 5,000 farmers countrywide. Under the deal, the company would purchase all the cocoons produced in Rwanda, through signed contract farming with cooperatives and farmers. However, the company could not continue operations past 2021 even after the government had invested almost $1.3 million in the Kigali-based silk factory buildings and machinery to process between 70-100 tonnes of silk cocoons annually. According to Jean Bosco Mulindi, Emerging Commodities Division Manager at NAEB, the factory is partially operational. “A part of the Kigali Silk Factory that consists of cocoon-drying is operational. However, the remaining part, which consists of reeling cocoons to process them into raw silk, is not in operation, he told The New Times. ALSO READ: Rwanda seeks investors to manage its silk industry When the the Korean firm pulled out of Rwanda, farmers were left demotivated, leading to a 43 per cent decline in the production of silk cocoons in the 2021/2022 fiscal year. “A new investor has not been found yet, but there are efforts to attract new investors, with some already expressing interest and discussions are ongoing,” Mulindi said. Way out NAEB indicates that there have been efforts in place to keep farmers growing and the industry growing, including providing essential materials for silkworm rearing and transporting their cocoon production to the sericulture centers located in each province for proper drying to ensure the cocoons are not damaged. There are six sericulture centers located in Gatsibo, Karongi, Gakenke, Nyanza, Mulindi (Gasabo), and Rusizi districts, supporting 180 active farmers in this business, with effective extension services and rearing activities. These centers also house machines used to unwind the silk from the cocoons produced by farmers, ensuring the silk is not damaged ALSO READ:Rwf 100m sericulture centre opened The government buys all the cocoons from the farmers to encourage them to keep up the practice. The cocoons, according to Mulindi, are sold at auctions, and mostly attracts Asian buyers. According to NAEB, the current farm gate price for cocoons is Rwf 3,500 for the highest grade, Rwf 3,000 for the mid-grade, and Rwf 1,200 for the lowest grade. The prices are reviewed and updated every October, to match with the existing international price of cocoons. As a results of the government efforts to support farmers, silk farming has grown, with the productive area under mulberry cultivation standing at 140.1 hectares, with 1.4 million productive mulberry trees as of September 2024. Since sericulture began in Rwanda, the total cocoon production from 2011 to September 2024 has reached over 152.3 tons, NAEB data shows. The revenue generated for the country from cocoon production amounts to USD 535,204.73 from 2019 to 2023. ALSO READ: Rwandan silk farmers in dilemma after the exit of a Korean investor Sericulture holds potential Sericulture holds a huge potential to diversify Rwanda's agriculture exports as the world's market demand for raw silk yarn continues to grow. The world price of quality silk yarn has increased from $30 to $70 per kilogramme over the last five years, with production by China, the world’s largest producer, declining by 20 per cent since 2008 due to various reasons including high labour costs and a reduction in available farmland for mulberry cultivation. “Rwanda can take advantage of the increasing demand and declining production to develop its silk industry,” Mulindi noted, adding that government interventions will include supportingfarmers to improve both the quality and quantity of cocoon production, while making efforts to attract investors to fully operate the Kigali Silk Factory. The demand for silk, a natural fiber derived from cocoons of silkworms, has soared over the years driven by consumer preference for natural and sustainable fibers, due to health and environmental concerns. This means that farmers in Rwanda have a chance to tap into the growing industry.

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No investor yet for Rwanda's sole silk factory