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Small-scale farmers from the north of the country sold hard yellow corn to Backus for a total value of S/. 1,000,000 (Translation)

25 January 2012

 - The Agriculture Vice-Minister, Juan Rheineck, P.E., attended the recognition ceremony.
- The result of this first campaign was presented.

Lima, January 20th, 2012.  As part of the programme Progresando Juntos, Backus presents the economical results of the second group of the production chain with hard yellow-corn farmers from Barranca. Accordingly, the Agriculture Vice-Minister, Juan Rheineck, P.E., and Backus acknowledged the producers from Barranca, Supe, Pativilca y Huaura for the results achieved and their entrepreneurship.

The goal of this programme is to improve the economy of rural families from the Pativilca, Supe, Huaura valleys and the Fortaleza valley in the Barranca province. The producers that participated in this campaign have increased their income 10%, thanks to the technical advice that increased the average yield of corn per hectare from 8TM to 9TM.

In that respect, Felipe Cantuarias, Planning and Corporate Matters Vice-President, pointed out that, "with Backus' programme, Progresando Juntos, we want to create the growth of micro, small and medium size business connected with our value chain. The producers participating in this campaign have sold to Backus a total of 803 TM of hard yellow corn generating a total value in sales of S/. 1,000,000. This result is possible thanks to the permanent support of the NGO Cedepas Norte, in charge of the training and the organisation of the farmers."

For his part, Agriculture Vice-Minister, Juan Rheineck, P.E., pointed out that, "the contribution of the private sector is fundamental in the growth of the agriculture in the country, that's why we recognise the work, the optimism and the entrepreneurship of the producers."

This programme has also generated an improvement in agricultural loans. These loans made more than 40% of the total, increasing the production costs. With the support of Backus, an agreement was reached with Caja Nuestra Gente for a monthly rate of 1.8%, equivalent to a 23.87% annual rate, placing S/. 235,000 in credit for this campaign.

Finally, Felipe Cantuarias added that for Backus, the development of this productive chain has been the beginning of a project that brings the challenge of buying hard yellow corn -- product used as an ingredient in some of our brands nationwide -- and adapting the logistic, finance and accounting processes to receive this product through small producers rather than big international traders. "In three years, Backus went from buying 1,500 to near 12,000 tons and getting closer to small-scale producers, knowing their necessities and getting suppliers for them  for wholesales and microbusiness institutions  that offer them better interest rates."

About Progresando Juntos

It is the development programme for business owners of micro, small and medium-size companies, connected to agricultural sectors, services, commercialization and tourism of the geographical areas of Backus group. The programme wants to contribute in the creation of opportunities for local sustainable development in terms of development of markets, employment and wealth creation among suppliers, clients, artisans of communities of interest for Backus, and hard yellow-corn farmers.

Since 2008, Backus created a production chain with small, hard yellow-corn farmers from the Jequetepeque valley. This programme includes a component of development of production capacities that allowed an increment of the performance of their crops from an average of 7,5 to 9 tons per hectare and savings in the production cost thanks to the joint  purchase management. Also, the programme contemplates a second component of promotion for the association that allowed the creation of almost 10 associations and a centre of producers with the challenge of commercializing directly with the company since 2010. In Valle de Jequetepeque, 277 farmers participate in this production chain who are associated in the Central de Productores del Valle de Jequetepeque (CEPROVAJE), they plant 900 hectares and have sold to Backus 12,000 tons of corn during the last year.

Since 2011, the work with Cepedas Norte started, with a second chain in Supe, Pativilca and Huaura valleys. In this first year, the productivity of 24 workers improved, selling around 3,000 tons to the company.

These results, which are challenges by themselves and opportunities of a programme with a long-term vision, wouldn't be possible without the confirmation of strategic alliances that allow taking advantage of the strengths of the areas of the companies involved, as well as the NGO Cedepas Norte, that had a critical role in the generation of confidence and the creation of the associations and the leaders of the production associations; Leaders who have promoted the fulfilment of the quality standards and the adoption of a new business role that makes the producers capable of negotiating their contracts with the company, knowing better about prize markets and visualising the future in terms of this relation in the long term. 

About Backus

Union of Peruvian Breweries and Johnston, is the industry leader in Peru, with 5 decentralised production plants in Lima, Arequipa, Cusco, Motupe and Pucallpa. It has a portfolio of national and international brands well segmented, that want to satisfy consumers in more than 150,000 selling points throughout the country. During 2010, Backus registered net sales of S/. 2,676.7 million, contributed to the Treasury with S/. 2,004 million and gave direct jobs to more than 1,700 people.

Backus works with a focus in sustainable development, with the goal of generating shared value with those who are part of its production chain and the communities in which it operates. That is why all its initiatives and projects want to generate social inclusion: strategic alliances to favour the efforts and achieve a positive impact in economical, social and environmental terms for the society as a whole.

For more information, contact:
Cecilia Quevedo -  Backus - 311 3000
Yohana Medina
LLORENTE & CUENCA - 222 9491(208)

This SABMiller subsidiary news release has been translated from its local market language to English language for publication on www.sabmiller.com. We have attempted to provide an accurate translation of the original material but due to the difficulties of translation slight differences may exist.

Note, the news release was first published in its local market on [20/01/2012].

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