Agriculture is the base to a stable economy and it is the key employer in most african countries this thread follows developments in the african agri- industry
Now the country’s central bank and Africa’s richest man, Aliko Dangote, have teamed up to establish a $25 million tomato-paste factory that could boost income for Ibrahim and the 8,000 farmers who live in the valley.
“We are doing this only to feed, as you can see, I can’t afford the luxuries of life,” the stocky 56-year-old said as he sat on a stool on June 6 outside his mud-walled house, which is surrounded by tomato fields as far as the eye can see. “There are better prospects in supplying Dangote because people will buy from them from all over the country. We hope that things will improve.”
The intervention by the Central Bank of Nigeria, which commissioned a study to show that processing local tomatoes is cheaper than importing paste from China, is part of the government’s drive to cut annual food imports of more than $10 billion. It also plans to boost agriculture in a country that was food self-sufficient in the 1960s, and create jobs in the north where poverty and unemployment have fueled an Islamist insurgency.
“We want to take Kadawa as a model and prove that with the right application of government policy we could get finance to the sector, improve productivity, create jobs and raise income,” Central Bank of Nigeria Governor Lamido Sanusi said in a June 25 e-mailed response to questions.
The 2011 study showed that Nigeria, Africa’s most populous nation, pays $360 million to import more than 300,000 metric tons annually of tomato paste from companies including Hebei, China-based Baoding Sanyuan Food Packing Co. and Singapore’s Olam International Ltd (OLAM). a year. The country produces 1.5 million tons of tomatoes annually of which about 900,000 tons rot, Agriculture Minister Akinwunmi Adesina said at a June 13 presentation in the capital, Abuja.
Annual consumption is about 900,000 tons. Tomatoes feature in popular Nigerian dishes like Suya, a spicy northern delicacy of meat kebabs with raw tomatoes, as well as a tomato stew eaten with rice, beans, yams and cassava dough.
Dansa Holdings Ltd., a unit of Dangote Group, the company that accounts for the bulk of Aliko Dangote’s $19.9 billion wealth, took up the project after a a failed attempt to get importers including Olam, Conserveria Africana Ltd. and Chi Group Ltd. to form a venture. The plant is expected to start by November and will produce more than 400,000 tons of tomato paste annually. Most of its tomatoes will come from farmers in Kadawa Valley.
Farmers will receive a guaranteed price of about $700 per ton compared to an average of less than $350 now, the central bank said.
Dangote, the world’s 32nd richest man according to the Bloomberg Billionaires Index, owns businesses including flour mills, fruit canning plants and palm oil refineries. He also owns cement, salt and oil assets. He was born in Kano.
“It’s a win-win situation. We have a price we can compete with and the farmer has a price that makes the tomato a good value,” said Sani Dangote, vice president of Dangote Group and a brother of Aliko Dangote, in a June 18 interview in Abuja. “It’s only agriculture that can take poverty away overnight because it doesn’t take long for the farmer to see the results and reap the rewards.”
While agriculture accounts for more than 40 percent of the economy of Africa’s biggest oil producer, most output is by subsistence farmers who eat much of what they grow.
Gross domestic product per capita is $1,436 in the south and $718 in the north, according to Lagos-based Financial Derivatives Co.
Nigeria is now the world’s second-largest importer of rice and sub-Saharan Africa’s biggest wheat and sugar buyer.
Farmers in northern Nigeria once grew cotton, peanuts, cowpeas and rice for export. Half of Nigeria’s 160 million people dwell in rural areas and four-fifths of those live on less than a dollar a day, according to the United Nations’ International Fund for Agricultural Development.
Nigeria attracted agricultural investment worth more than $8 billion in the past 18 months, Adesina said. Still, only 40 percent of its 21 million hectares (51.9 million acres) of arable land is cultivated.
“Our strategy is to change the face of the north,” Adesina said. “We’re using agriculture for poverty reduction; our intention is to create wealth.”
Key to the government’s plan to end rice imports, now costing 1 billion naira ($6.2 million) a day, by 2015 and expand crop exports, is a central bank plan to channel credit to agriculture.
The Nigeria Incentive-Based Risk-Sharing System for Agricultural Lending, or Nirsal, a unit of the Central Bank of Nigeria, which carried out the tomato study, also provides credit guarantees to enable banks to lend to farmers, Jude Uzonwanne, its head and a former consultant at Boston-based Monitor Group, said in an interview in Abuja.
At Kadawa, Nirsal determined that “about 8,000 farmers producing in about 5,000 hectares needed roughly 4 billion naira in working capital,” he said. It also established a farm office of agronomists and managers “to run all the middle mechanics between growing crops and delivering to the Dangote factory.”
Nirsal has the mandate to guarantee as much as 75 percent of loans to agriculture. Since giving its first cover for a loan by Sterling Bank in July last year, it has gone on to work with most lenders in Nigeria, according to Uzonwanne. By April, it had issued guarantees for loans worth 25 billion naira, covering an average of 57 percent of lending, he said.
Apart from tomatoes, Nirsal has provided similar guarantees for producers of cassava chips, rice, soybeans, cocoa and leather.
Loans to agriculture as a share of total credit rose to 3.8 percent in February from 1.5 percent in December 2009, according to figures released by the Bankers’ Committee. The central bank has set a target of 10 percent of all loans to agriculture by 2016.
Dansa expects to produce enough tomato paste for both the local market and export, Sani Dangote said.Chinese exporters to Nigeria have responded.“We’ve seen prices prices from China drop 30 percent in the light of our plan,” he said. “Everyone in the tomato world is aware of our project.”For Ibrahim these developments mark a turn of fortune.“Before the price of tomatoes would keep going down because all the farmers sell at the same time,” he said. “With the coming of the Dangote factory, prices won’t go down that way any more. We can be sure of a stable income.”
To contact the reporters on this story: Dulue Mbachu in Abuja at [email protected]; Edwin Olofu in Kano at [email protected]
To contact the editor responsible for this story: Antony Sguazzin at [email protected]
Macadamia, a native to the eastern coast of Australia, thrives in sunny and humid weather conditions. The crop, also known as the Queensland nut, is also grown in Chimanimani, Marondera and Nyanga.Located on a hill along the Chipinge–Chimanimani highway, Waterfalls Farm is one of the commercial farms in the area renowned for producing high-quality macadamia.
“As part of our comprehensive diversification plan launched in 2005, land under cultivation has grown from 30 hectares to 320 hectares of macadamias, from nothing to 74 hectares of avocadosfrom nothing to 400 hectares of maize, and coffee has been constant at 200 hectares. More continued growth is planned for macadamias,” said Bart Kotze, who manages the farm.Kotze pointed out that, unlike other farms which exported roasted and processed macadamia, Waterfalls shipped the nuts in shells, primarily to China and South Africa where the products were in high demand.
Kotze explained that a fully-grown macadamia tree produced about 100kg of nuts a season. A tonne of dehusked nuts fetched between $2,000 and $3,000 depending on the grade. Good quality macadamia crops could earn a farmer up to $7,000 a hectare.“Leaving the husk on for more than two days causes mould and increases processing time, as the husk tends to harden,” said Kotze. “After de-husking, the nuts must be carefully sorted for size and quality. They must be air–dried in the shade for at least two weeks. During the drying process, the moisture content of the nut is reduced and it becomes firm.”
Close to 200 commercial and smallscale farmers are in macadamia production in Zimbabwe.“Macadamia production started here around 2000 in the eastern highlands. It can also be grown in agro-ecological regions one to three. The crop can be more viable and profitable than cash crops such as tobacco,” said Lazarus Dhliwayo, the technical advisor of the Macadamia Growers’ Association of Zimbabwe.
Macadamia trees start life as nursery-sown nuts. When they reach about 30cm, the seedlings are lifted and planted in the field at a spacing of three metres. The seedlings grow into a four-metre tree in five years and start to bear fruit. They remain productive for around 30 years.
The nuts ripen in about 10 months and picking is done around March and April.the nuts can be processed into soap, body lotions and cosmetics. Macadamia kernels are sold as snacks and as a cooking ingredient. Even the shells are useful as mulch, fuel for processing macadamia nuts, for plastic manufacture and as a substitute for sand in the sand–blasting process.
Africa is on the way to realising the 4.4 per cent growth in Agriculture per annum as envisaged in the formation of the Comprehensive Africa Agriculture Development Program (CAADP) in 2003 by African heads of state in Maputo, Mozambique.The Commissioner for Agriculture at the African Union Rhoda Peace Tumusiime said the last 10 years have registered some progress, but it is not adequate.
“We have a paradox in which whereas we talk about growth in agriculture, we still remain the continent with the largest number of people suffering food shortage and malnutrition,” said Tumusiime at the opening of the two days technical meeting of officials drawn from the Ministries of agriculture, rural development, fisheries and aquaculture from the African Union member states.
The technical teams are meeting ahead of the ministerial conference slated to begin on Wednesday.While noting that agriculture and the rural sector are at the centre of transformative agriculture in Africa, Tumusiime noted that the transformative agenda can only succeed if challenges associated with modernising African agriculture are addressed.“For agriculture to become more productive and competitive,” she said. Tumusiime said value addition to agricultural produce is key to feeding the ever increasing African population.
She said African agriculture is under threat from environmental degradation and urged that while agriculture grows, the factors that impede high productivity due to climate change ought to be addressed.She noted that for the agricultural sector to continue feeding the rising urban sector, “small scale farmers must be allowed to play their rightful role within the chain of domestic and regional markets.The June 2014 AU Summit slated for Equatorial Guinea is expected to adopt a declaration on “Africa’s Accelerated Growth and Transformation Goals to be achieved by 2025.
Turnaround predicted for South African poultry industry
The sector has been through a difficult few years, weighed down by cheap imports, soaring feed costs, weak consumer demand and impending regulations to cap the levels of brining allowed in frozen chicken products.
Nine smaller producers have either gone under, filed for business rescue or been absorbed by larger companies in recent months. Astral Foods has recently snapped up the assets of two producers at liquidation auctions, South African publication Business Day has reported.
The sector was reprieved last year when tariffs were imposed on imports from most regions — though Europe was exempt due to free-trade agreements. However, the sector has since lobbied for duties on "below-cost" imports from Europe.
The International Trade Administration Commission of South Africa (Itac) sent an investigative team to Germany and the Netherlands as part of its verification process. Spokesman Thembinkosi Gamlashe says that the investigation "is still in progress" and a preliminary determination — which could grant interim protection — is expected to be made within the next two months.
Vunani Securities analyst Anthony Clark, points to a possible decline in maize prices and import protection as the main reasons for a turnaround in the sector. He warns however, that the recovery will be very gradual, as "there are too many variables out there which are beyond the control of anyone in the sector". The upturn will be held back by food price inflation and a rising interest rate cycle, which will further stretch consumers.
Clark says, importantly, the bigger maize harvest this year could translate into lower input prices in the second half of the year. Feed costs, which are largely made up of maize, account for about half the costs of raising a chicken. Input costs have been abnormally high in recent months on high international maize prices and local shortages.
South African Poultry Association CEO Kevin Lovell expects that by midyear, the maize price should drop, while the association is hoping for "provisional protection against European dumping" by the end of next month. "It will take a little while for the effects of that to flow through. So there's a chance that quarter three could start to look better," Lovell says. "We are still in the bottom of the trough. I don't think it's going to get worse but I do think it's going to take a little while before it gets better."
who are you talking about ?4.4% and population growing 2-3%.
From such a low base should be growing at 6 or 7% minimum in most nations.
The quickest and IMO the easiest sector to turn around. It can take 20 years to build up decent industrial infrastrucure whereas you can go from net importer to net exporter within a few years with the right policies.
Harare — Madeline Murambwi sits behind the wheel of her brand new Toyota Land Cruiser, threading her way through the traffic in Zimbabwe's capital, Harare. She's on her way back from the tobacco auction floors where she just pocketed thousands of dollars.
"Tobacco farming is a brisk business here. Before joining it, I didn't realise men were making lots of money out of this leaf. I have made great economic strides in my life," Murambwi tells IPS, adding that she now also invests in property.
"So far I have made 42,000 dollars through tobacco sales, with more sales to come," says Murambwi, 47, who has a 32-hectare tobacco farm in Zimbabwe's Mashonaland East Province.
In 2012, Murambwi ventured into tobacco farming and her business continues to grow each season.
"Faced with responsibilities I couldn't avoid as a single parent, I turned to tobacco farming as a way to generate a more reliable income," Murambwi says.
On the Zimbabwean market, a kilogram of tobacco can sell from between 2,67 and 2,91 dollars, depending on the quality.
According to independent statistics from the Zimbabwe Association of Women Tobacco Farmers (ZAWTF), 85,006 farmers, 32 percent of whom are women, registered to grow tobacco during the 2013 to 2014 season.
The government's Tobacco Industry Marketing Board, however, estimates that there are currently 110,000 small-scale tobacco farmers, of which 39,5 percent are women.
"The increase in women tobacco farmers here is actuated by an increase in the number of single mothers, either widowed or divorced, pressed hard with financial responsibilities of looking after their children ... they are fast finding tobacco growing a panacea to turning around their fortunes," ZAWTF chairperson Grace Mapuranga tells IPS.
"Women here are fast becoming tobacco tycoons, holding their heads high in the midst of male tobacco farmers, who traditionally dominate the field of tobacco farming," adds Mapuranga.
Elsie Msipa, 38, is one of those farmers who has seen her fortunes turned around by tobacco farming.
"Tobacco has changed my economic fortunes for the better. I now own clothing shops around Harare," Msipa tells IPS.
She says her success if partly in thanks to the Ministry of Agriculture, Mechanisation and Irrigation Development, which has provided "expert knowledge concerning growing tobacco and assistance from different tobacco experts."
According to the agriculture ministry, the tobacco industry accounts for 40 percent of exports.
The ZAWTF estimates Zimbabwe's 2013 tobacco exports at 771 million dollars, with women farmers contributing 25 percent of the total exported leaf. The Food and Agriculture Organisation of the United Nations ranks the country as one of the major tobacco exporters in the world. The leaf is exported to countries like China, Belgium, United Arab Emirates, South Africa, Russia, Hong Kong, Sudan and Malaysia.
Behind the success of these new tobacco barons are civic organisations.
"We provide support networks to these women, ensuring they have access to resources and skills training and development," Phides Mazhawidza, director of Women Farmers, Land and Agricultural Trust, tells IPS.
"More often women lack support networks to assist them effectively utilise the land and market their produce. We create collaborations between women farmers and other organisations, government and private partners to enable them get the best out of their land," adds Mazhawidza.
Independent economist Artwell Jamela tells IPS: "Women tobacco farmers are bearing positive results on the country's struggling economy, where tobacco accounts for 10.7 percent of Zimbabwe's GDP."
Jamela says as the number of economically-active women in the informal sector increases, it could result in female tobacco farmers overtaking their male counterparts as more Zimbabwean men are formally employed than women.
However, the Gender Links 2013 Barometer on Zimbabwe reported that although Zimbabwe's economic framework calls for women's participation in key sectors of the economy, there are no gender-responsive policies in the agriculture and mining sectors.
But a government official from the Ministry of Gender and Women Affairs and Community Development told IPS on the condition of anonymity that this would soon change.
"Plans are at an advanced stage for the government to align legal frameworks that would ensure equal opportunities between men and women in agriculture and mining ahead of the looming deadline of the 2015 U.N. Millennium Development Goals," the official said.
China’s south-south cooperation programme for the area of agriculture is strengthening the sector in various African countries, among them Mozambique, Mozambican Vice-Minister of Agriculture António Limbau said on Friday in Maputo.
During a meeting which considered a Chinese rural development and poverty reduction programme applied for the first time outside China, Limbau said it was “a unique opportunity which enabled us to learn about China’s progress, review success cases in various African countries and share the Mozambican government’s programme to implement its strategy plan for agrarian sector development.”
The event was attended by representatives from 14 African countries. The programme included field trips to the Mozambique/China Investment and Technology Transfer Centre in Boane on the outskirts of Maputo and to a rice field in Gaza province developed with investment from the China Wanbao Oil & Grain Co.
“The Wanbao Moçambique project has played an important role in transferring technological know-how to Mozambican farmers, helping increase their productivity and consequently that of others involved in the project,” Limbau explained.
In his speech, Chinese government representative Zhang Zhengwei reiterated his country’s commitment to support the south-south cooperation programme in the agriculture sector, exemplified by the fact that the event was held for the first time outside China.
Interesting but weirdWorld's biggest fly farm coming to Cape Town
The world’s largest commercial fly farm, which will harvest maggots from about 8.5-billion of the insects housed in giant cages, is under construction near Cape Town, a project that developers say is a first step toward shaking up the global animal-feed market.
The 8 500 square-metre undercover facility, being built by Gibraltar-based AgriProtein, is due to be completed next year and aims to produce 23.5 metric tonnes of insect-based protein meal and oils and 50 tonnes of fertiliser a day. Fish and chicken farmers have already signed contracts to buy the feed, an alternative to soy and fishmeal, according to Jason Drew, the company’s co-founder.
“The farm will take in 110 tonnes of organic waste, out-of date-food, uneaten food from restaurants, hotels, some animal manure and some abattoir waste” and recycle the nutrients, Drew said in a July 8 phone interview from Cape Town. “We copied the idea from Mother Nature. In 15 years, it will be as normal to recycle your waste nutrients as it is to recycle your tin, your glass or your plastic today.”
Sydney-based Twynam Agricultural Group is among backers who have provided $11-million of funding for the project and a second facility in South Africa, the location for which is still being decided. AgriProtein intends building another 38 fly farms and has had expressions of interest from 43 countries.
“We are looking at returns on investment in the mid- twenties,” Drew said. “We aim to undercut the cost of fishmeal by about 15%.”
The farms will be stocked with common houseflies, black soldier flies and blowflies, which consume most forms of organic waste. Three to 4% of the flies’ eggs will be hatched to maintain the farm’s insect supply.
Insect larvae are the natural food of chickens and fish and their nutritional composition is as good as that of fishmeal and better than soy, according to AgriProtein, whose products have been under development since 2009. Producing insect-based protein also doesn’t have the adverse environmental consequences of producing animal protein, which requires more land and water.
AgriProtein’s products have been approved for sale in South Africa and Drew expects it to secure distribution licenses in the European Union within the next two years. Product approval is being considered on a state-by-state basis in the US and Canada, with Ohio already having granted permission for them to be sold, he said.
Fly farms could utilize abattoir waste that would otherwise have to be disposed of in landfills, said Matthew Addison, a researcher at the University of Stellenbosch’s Conservation, Ecology and Entomology Department.
“We are throwing protein away,” he said in a phone interview on Tuesday. “Fly farms can bring it back into the food chain in a very acceptable form. The fly larvae produce very high quality protein. It’s brilliant. The science is solid.”