Ambassador Ebrahim Rasool is South Africa’s Ambassador to the United States of America. Some of the positions he has held are Member of Parliament in the National Assembly, Special Advisor to the State President of the Republic of South Africa and Premier. He has also received several leadership awards including; the Visionary Leadership and Public Good Award from the World Congress of Muslim Philanthropists, and the Award for Commitment and Leadership in Fight Against Crime from Business Against Crime, the Foreign Direct Investment Africa Personality of the Year Award, and the Nelson Mandela Award for Health and Human Rights. Africa Agribusiness was able to catch up with him and ask him a few questions.
What impact do you think that AGOA has had on South African Trade relations?
I think that trade relations between the US and South Africa is largely driven by AGOA at this point. We have exports from the US to South Africa that is worth 7 billion dollars. We export 8.7 billion dollars’ worth of goods largely through AGOA so we actually have a trade surplus with the Unites States. If we were to look at the 2010 figures, we have seen an 11% growth in jobs in South Africa because we export to AGOA and in manufacturing GDP we have seen a 2.78% increase. I think that AGOA is the main instrument of trade between South Africa and the United States.
South Africa sends about 2000 products to the Unites States via AGOA; some of them raw materials, some of them agriculture, some of them manufacturing, and so on. But I think that the impact on jobs, the impact on the GDP from the 2010 figures is the enormous one and the fact that we have a trade surplus with the United States.
Do you have any suggestions to AGOA to better serve its purpose?
Look, I think that a country like South Africa has obviously taken good advantage of AGOA because you get many countries that only export oil or only export some raw materials or just two or three products; South Africa exports 2000 products. We think there is still some protectionism by the US. For example, we’re not allowed to export canned peaches to the United States because I think the farmer in Georgia won’t be happy with the competition. I think that we export lots of agricultural goods but we face many non-tariff barriers; so the goods can come in but, for example, sanitary barriers are still there. So, for example, the US makes some of our fruit wait for 24 days when they could qualify for 22 days, so the shelf life diminishes. I think those are the kind of issues we would raise. And the last one is that we really need certainty with AGOA. We can’t wait until the last moment before it is reauthorized otherwise we will really lose orders. For example, if AGOA is to be reauthorized in 2015 it would be really good if in the middle of 2014 we had a sense of how AGOA would continue.
What other improvements do you think can be made to better support the South African environment?
I think that we want the range of products to be increased. Like I said, we export 2000 of a possible 6000 products. South Africa can increase the number of products except that the US sanitary regulations keep quite a few products out, so it is through non-tariff barriers, in tariff barriers it’s allowed in but in terms of non-tariff barriers it’s kept out. I think an example of such a product would be sugar; the sugar market in the US is being protected by keeping sugar from South Africa out of it. We can understand some of those restrictions, we have tried to be very sensitive to the US market. And so, for example, our largest agricultural product that we export to the US under AGOA would be citrus- oranges and we send that only when California and Florida in off-season. We are very sensitive to the US market. We are not here to squeeze out Florida or Californian’s oranges, we just want to be in the gap period so that the US market can have access to oranges all year around.
We would also want to improve AGOA by increasing the range manufactured goods, beneficiated goods, to the USA. And so we are working on a very important project; say, for example, Boeing. Boeing is helping South Africa turning Titanium ore into powder, then we export that. So that creates more jobs in South Africa. So, I think we really need to increase our product range, we need to overcome some barriers here and we need to increase the proportion of manufactured goods within that product range. But I think overall we are very proud of our achievements in AGOA. I mean, every C-Class Mercedes Benz and every 3 series BMW you see driving around in the US is made in South Africa and it comes to the USA via AGOA. We of course also have our wines.
A lot of people believe that regional integration is crucial in achieving the goals of AGOA and various national needs. In your opinion what is the importance of regional integration?
I think that Africa and the African Union has understood the critical importance of regional integration. I mean, we often do more trade with Europe than we do with Africa. So, intra-Africa trade is very low, it is only 12% of the total continent trade. The reason is not that we don’t want to talk to each other, that we don’t want to trade with each other, the reason is that the infrastructure doesn’t speak to each other. We don’t have railway lines and road networks that connect Africa. We have railway lines and road networks from the mine to the harbor. That is only designed to take goods out. So, even if sometimes a country wants to send a product to another African country it will probably have to go via a European country to reach another African country.
So, with regional integration, the political will is there now; three regions East Africa, Central Africa and Southern Africa have all signed an agreement to integrate. Now, we need to build the infrastructure to assist that integration. I think that offers the US enormous benefits because it will not have to negotiate market prices with 54 countries, it can now begin to negotiate market access with Africa and have cheaper rates. I think that is very important but part of the things we are trying to persuade the US of is that even with South Africa’s success under AGOA we should still have a role to play after 2015. To exclude South Africa would be a big mistake because, while for example a country like Congo may send a few products to the USA such as rubber, it would first have to send it to South Africa to turn into tires, these tires would be put on the Mercedes or BMW and then they would be sent to the USA. The same goes for leather seats; the hid may come from Botswana but it must be sent to South Africa to be turned into leather and then made into car seats. You can look at South Africa as the factory of the continent. If you eliminate South Africa you will hurt the continent because then what do the other counties do with their raw materials.
One of the problems you mentioned was infrastructure, what do you think can be done about, not just infrastructure, but also any other problems that may hinder integration?
President Obama was in South Africa recently, one of the calls that was made was for him to support integration efforts in Africa. He is willing to do that. And we have all heard this announcement about Power Africa; how the US wants to make sure that one component of infrastructure, namely the supply of energy can be taken care of. We want the US to play a more active role in the overall infrastructure campaign; building roads, building railway lines, building harbors, building airports, etc,etc. Also in the soft logistics: How do goods pass over borders? Trucks should not have to wait for two days at the border post because the products lose shelf life. So I think there is a major role for counties like the US to come in and help build our infrastructure. And companies in the Unites States, we just got a major contract with our locomotives that is being supplied by General Electric. The deal we made with General Electric is that we need 100 locomotives, we need 10 urgently so build them in the US and send them over, the [other] 90 we can set up a plant in South Africa and our people can assemble them. So, I think we are beginning to find creative ways of helping out.
Which other areas in South African sectors do you think could do with further improvement?
Other than the infrastructure as a location for investment there should be, across Africa, but in South Africa as well, manufacturing capacity. We have got the gold, we have got the diamonds someone needs to get into jewelry making. We have got agricultural products; how do we increase our juice-making capacity? How do we improve our canning? How do we add value to our different raw materials because Africa will not create significant jobs and skills unless we go to a higher level of operations and it takes a certain number of workers to mine, it takes a few workers to harvest, it will take a whole lot more workers to add value to the agricultural products. I also think that we also need assistance in the knowledge economies. We need counties like the US to help us set up astronomy schools and to bring the ICP companies into Africa to assist us with the technological revolution. Another example is the cellphone revolution people are doing their transactions on their phones, they are not even going into banks anymore. So I think that investing in infrastructure, manufacturing and technology would greatly assist help.
Most importantly, Africa will have 50% of the world’s population under the age of 35 in two decades. We need the world to come and invest in our human resources, to come and give skills to those young people, otherwise they will be guns for hire for any fundamentalist or extremist cause in the world. We need people to get scholarships, we need people to come and set up universities on the African continent, we need the highest form of skills to be developed. Those are the four main areas of investment that not only South Africa, but the rest of Africa, require.
Can you please discuss how South Africa benefits from its frequent association in the media with the BRIC (Brazil, Russia, India and China)?
We live in a globalized world so globalization doesn’t respect national boundaries. Goods move at the push of the button, capital moves at a flick of a button, crime is transnational, trade, investment, everything is transnational. So the only way you can get protection in the world is to be associated with other similar countries, we see that if we are too dependent on Europe and America when they go into a recession we lose jobs in Africa. Not because our economy is bad or our banks are weak, we have the strongest banks in the world in South Africa, but we lost a million jobs because we are too dependent on Europe and the United States as our export markets. So need to find other trading partners and investment sources. We also have to find other developing economies in a similar situation to us and that is where Brazil comes in, where Russia, India and China come in, together with South Africa and other countries like Turkey, Indonesia, Mexico and others, we are the emerging economies/ markets in the world. I think that because we have similar conditions, we have similar problems and similar dependencies we now know we can’t put all our eggs into the Euro-US basket. Now we are trying to shift our eggs a bit into Africa and other emerging markets. That really is the major reason for South Africa’s association with BRICs. The second reason is that at the time when the US for example doesn’t have disposable investment income and is scared of Africa and their media only tells negative stories about Africa no US investor is bold enough to go and see for themselves or invest in Africa.
China has seen the opportunity in Africa and I always tell the US that China is there in Africa because the US isn’t. If the US was there, we would want the competition, we would want to have choices, we don’t want to make another mistake and put all our eggs into the Chinese basket. When the US deals with Africa they have all these preconditions; democracy, human rights, etc. The problem is they still trade with the Middle East and none of those conditions are insisted upon. So, why insist on it with Africa? And then you also complain when the Chinese come and invest in Africa? So the point that I’m making is that China has been a wonderful source of capital for the continent which bought our resources, although we would prefer to sell them manufactured goods. Africa has growing needs and beggars can’t be choosers.
In your opinion, how do you think South Africa could better attract US investment?
I think that there are so many studies that show that Africa is the next frontier and so we just need the US to pause for a bit and to look at Africa with different eyes; to see it as a continent of opportunity and not a country of problems. I think that is what President Obama was trying to signal when he went to Africa in June. The second point I think that we need to make is that the rate of return of investment in Africa is more than anywhere else in the world. If you invest there you get 8% returns. The global return is 3%, the US return is less than 2% so business sense would say you have got to be in Africa. I think we will even make it easy for the US to come into Africa by suggesting that they should come in via South Africa because South Africa has the second best banking system in the world. South Africa has the rule of law firmly entrenched, it’s got an internationally recognized legal system; if you transact in South Africa you can be pursued anywhere in the world. It’s got great ease of doing business, its good a comparably good lifestyle; any of your managers would love to live there. So, come to South Africa; we also have good companies who can hold your hand and take you to other opportunities on the African continent. That is why South Africa is referred to as the “gateway” into Africa. We are trying to make it as easy as possible.
How is South Africa received in other African countries?
I think that South African farmers are leading the agricultural revolution on the continent. We are going in there, helping to bring tracts of land into agricultural production. I think in much the same way, our retail sector is expanding into the rest of Africa. The converse is also true, we have some middle class Africans who come to South Africa to do their shopping. So, I think that South Africa is fairly well received; I think the fact that Africa voted for a South African to head the African Union is a major vote of confidence in the role that South Africa plays and people recognize that NEPAD (New Economic Plan for Africa’s Development), the AU have been worked on very hard by South Africans. And, South Africa has enormous credibility in Africa because we are the ones facilitating peace talks, keeping peace and conflict resolution as well as post peace reconstruction in Africa. So I think South Africa has a good reputation on the African continent. However, we are aware that we must remain humble, that we must not be the Big Brother that I think people fear. South Africa can be regional super power.
Lastly, the role that South Africa plays in Africa, and the role that Africa plays in the world has been brought to the fore a lot in the last few weeks when Nelson Mandela was in hospital. We have seen the whole world unite in thought and prayer around Nelson Mandela and think that we see him not only as a South African but as an African and I think that if Africa could produce and person of that stature, then I certainly believe that the world should now be ready to embrace Africa as a whole, especially its economic opportunity.
This has been very informative, thank you very much for your time.
Questions for South Africa’s Minister of Agriculture, Forestry and Fisheries, The Honorable Tina Joemat-Peterson
In November 2011, Africa Investor (AI), an international investment and Communications group, named you the recipient of the Africa Agriculture Minister of the year award as part of their annual AI Agribusiness awards. In your opinion, what have been some of your ministry’s most notable accomplishments since you took office in 2009?
Our administration invested a lot of work towards the establishment and maintenance of domestic and international markets. Moreover, we sought to open new markets in regions like the South and Central America and the rest of Africa. The benefits of these engagements have been astounding. We have seen trade with countries like Mexico, Argentina and Brazil increasing significantly. Our membership of BRICS is also expected to lead to further gains in terms of trade and investment with countries that share the same philosophies and vision. BRICS represents a block of countries that are destined to occupy a higher ground on economic growth and development terms going forward and we intend to maximize the benefits of being part of that collective.
Another notable achievement is the success we have had in halting job losses in agriculture. In fact, Statistics South Africa, the national statistics agency of the Republic, recorded a 87 000 growth in jobs between the second quarter of 2011 and the fourth quarter of 2012. This is a remarkable achievement, especially at a time when global demand was still fragile due to the economic meltdown in many parts of the world. It is through our efforts to open up new markets in other developing countries and our commitment to supporting growth of the smallholder farmers in the country that we have managed to achieve these results.
Shortly before commencing my term of office, our country had drifted to becoming a net importer of food. This of course was a major cause of concern for the current administration as it would leave us vulnerable to unfavorable movements in global food markets and in so doing threaten our food security situation. Today, however, we are proud to say that we have managed to reverse that situation and have become, once more, a net food exporting nation.
Although I do not have the exact statistics at this point, allow me to also mention that we have gradually increased the number of black smallholder farmers in the country. This we have done through ensuring that they have access to technical support and finance. Access to finance has always been the smallholder farmer’s biggest constraint but, working with the Land Bank, a state owned development finance institution, we have ensured that financial products tailor made for the needs of these farmers were developed and made available.
In some instances we have worked with the private sector to foster partnerships that will further develop smallholder farmers into prosperous entrepreneurs. A case in point is the partnership with Walmart/Massmart, which has seen to the development of smallholder farmers in Limpopo. The farmers were equipped with skills, training, finance and access to markets. Similar projects are in the pipeline for other parts of the country where the retailing giant has operations.
Since 2009, we have signed memoranda of understanding with several countries in the African continent. This is in line with our objective of increasing trade and engaging in mutually beneficial development programs with other African countries. We signed the following:
Centre for Coordination of Agriculture, Research and Development of Southern Africa (CCARDESA).The Memorandum of Understanding, the CCARDESA Charter, was signed in Pretoria on August 2011 and launched in Gaborone, Botswana July 2011. The purpose of this Charter was to provide Member States with a framework for the establishment of a sub-regional organization that will coordinate agricultural research and development (R&D) in the Southern African Development Community (SADC) region.
Seed Harmonisation Regulatory System was signed in Windhoek, Namibia during the Council of Ministers meeting in November 2010: The purpose of the MoU was to regulate the movement of seeds in the region, seed certification and phytosanitary measures for seeds. It is aimed at providing member states with a legal framework to cooperate in the implementation of the system.
The Minister hosted, in Johannesburg, the African Ministers’ Climate-Smart Conference in preparation for the COP17 Conference that was to be held in Durban, South Africa. The Minister was also instrumental in the development of the African position on agriculture for COP17 .
Bilateral engagements include the Republic of Congo (Brazzaville): Heads of State Summit for the Three Rain Forests Basin held in the Republic of Congo (Brazzaville) on 31 May to 3 June 2011.An agreement in the field of agriculture was signed in October 2010, the purpose of the agreement was to maintain and strengthen their bilateral relations in the field of agriculture, forestry and fisheries.
Abuja, Nigeria from 8 to 10 March 2010: High level Conference on the Development of Agri-Business and Agro- Industries in Africa. The Minister met with her Nigerian counterpart and discussed the potentials of the two countries’ agriculture sectors, with Nigeria interested expressing keen interest in developing her agro-industries and agro-processing. South African agro-processing and agro-Industries are encouraged to invest in Nigeria.
South Africa is among the 26 nations to be signatory to the Comprehensive Africa Agriculture Development Program (CAADP). The primary goal of CAADP is to eliminate hunger and reduce poverty through agriculture. In order to achieve this goal, the CAADP agenda aligns itself with the Maputo Declaration that called for African nations to increase public investment in agriculture by a minimum of 10% of their national budgets and to raise agricultural productivity by at least six percent. Has South Africa achieved this commitment? What would a 10% increase in public agricultural investment mean for the average South African farmer? What programs has this initiative funded? Can you briefly describe some of its successes?
The Department is currently undertaking a budget tracking exercise to determine allocations to agriculture and rural development across the three spheres of government. I am confident that this will reveal that South Africa is investing heavily in these areas, although the national budget of the Department does not constitute the 10% target.
While not contesting the target set through the Maputo Declaration, it should be noted that in the case of South Africa, the primary agriculture sector contributes between 2.5% to 3% to the country’s gross domestic product (GDP) and it may therefore be difficult to justify an allocation of at least 10% of the national budget to the sector. The situation is made even more complex in a country that is still burdened by the legacy of apartheid that manifests itself in high levels of poverty, unemployment and inequality.
The CAADP agenda outlines certain strategies that should be employed in order to actualize its goal of reducing rural poverty. Strengthening the capacities among the agribusiness community is listed as one of these strategies. How has your Ministry improved the agribusiness community’s ability to operate in South Africa?
Agribusinesses in South Africa are doing relatively well, although like all the other industries, they have also in some ways suffered the consequences of the global economic meltdowns of recent years. Within the CAADP processes, the Department of Agriculture, Forestry and Fisheries consulted with agricultural industry stakeholders to make inputs on how the CAADP agenda should be shaped in South Africa. There have been two consultation meetings with civil society organisations. The agribusiness community in South Africa is a vibrant one which adds significantly to the country’s economy. Various departments, such as the Department of Trade and Industry, have established incentive schemes to promote agribusinesses as part of building rural economies. We also strive to maintain acceptable turnaround times in our regulatory services to keep the costs of doing business as low as possible for agribusinesses in the country.
South Africa helped lead the way to the establishment of the Centre for the Coordination of Agricultural Research and Development in Southern Africa (CCARDESA). The stated goal of the CCARDESA is to secure regional food security through research and innovation. The Centre intends to focus primarily on improving the agricultural practices of smallholder and small commercial farms. What has been the impact of the CCARDESA on smallholder and commercial farmers, thus far? How does your Ministry ensure that the research findings and suggestions of the CCARDESA reach the average South African Farmer and the agribusiness community as a whole?
CCARDESA was only launched and implemented less than a year ago. So, it is too early for us to assess its impact. South Africa has been invited to serve on the board of CCARDESA through the leadership of the Agricultural Research Council (ARC). A regional planning workshop is being conducted by the new board of CCARDESA to identify and agree on priorities for the year as well as to ensure clear alignment to CAADP multi-country productivity programmes through research.
While giving a speech marking the establishment of CCARDESA, Botswana’s Minister of Agriculture remarked, “the issue of food security is particularly challenging to our region because despite the various challenges we have, the region is endowed with reasonable resources, that if put to good use, can change the situation.” How far is South Africa from achieving food security? What role do you see for South Africa and its neighbors in achieving food security? Could increasing trade within the region assist all parties involved in reaching their agricultural needs? Do you believe increased regional agribusiness related trade and investment could provide more jobs to South Africans?
We are on the verge of taking a Food Security Policy to Cabinet, which will respond to both national and regional concerns about food security.
South Africa is food secure as a country, however up to 13% of citizens experience food insecurity for a number of reasons, including lack of income due to the high levels of unemployment, inadequate storage facilities and distribution networks. It is with this realisation in mind that we have embarked on programs aimed at increasing household food security in the country. In this regard, we are actively assisting smallholder and subsistence farmers, particularly in the former homeland areas with potential for production. Our target is to put one million hectares of land with potential for agricultural production, into production within the next few years. This year farmers will be harvesting the first crops from this programme, which has proven to be successful and well received.
Agriculture and agribusiness have been identified in the New Growth Path as key jobs drivers, and the National Development Plan envisions up to 1 million new jobs in these sectors by 2030. Regional trade development is part of this, as is expanding trade especially with Brazil, Russia, India and China in the context of BRICS.
Leading up to last September’s global climate-change meeting in Durban, your Ministry fought hard to ensure that agricultural issues occupied a main part of the meeting’s agenda. The Mail & Guardian, a South African newspaper, quoted you as stating, “Feeding our people at a time of climate change is the real challenge. As long as agriculture is the sector that is most vulnerable to climate change, we will always have a responsibility to mobilize the rest of the continent.” How has your Ministry promoted sustainable agricultural practices in South Africa and on the continent? How has your Ministry acted to prepare for climate change events in terms of food security?
We are currently conducting research which installs bio-digesters on farms owned by small-scale and subsistence farmers in the rural areas of one district in the country. The project enhances household food security and job creation and promotes rural development by providing alternative sources of energy. The project has training and capacity building components to it that are aimed at improving its sustainability in the long run.
We have legislation and policies that are aimed at addressing the sustainability of agriculture in the country. Chief among those is the Conservation of Agricultural Resources Act (CARA) 43 of 1983, whose objective is to conserve agricultural resources. A number of programmes focusing on the maintenance of the production potential of the land are implemented. The LandCare programme is aimed at optimising productivity and sustainability of natural resources to enhance greater productivity, food security, job creation and better quality of life for all and identifying measures to address issues of LandCare including mitigation and adapting to climate change. Under this programme we are encouraging best farming practices such as diversification, selection of crops with shorter germination period and shorter growing season as well as developing new breeds for livestock and crops in order to adapt to the changed environment particularly in dry land farming areas.
We are currently conducting a climate change research project which analyses an ensemble of present day and future climate simulations with the aim of determining the crop suitability of selected crops for the South African region. This analysis has the potential to identify regions where temperature related events can negatively impact crop production.
Agricultural production is risky as it is very sensitive to the extreme weather and climate conditions. The sector continues to be affected by the impacts of natural hazards due to the frequency of extreme weather and climate events. The expected impacts of climate change make it even more vulnerable. It is in that light that among the Departmental programmes early warning system for natural hazards disseminates warnings and advisories in line with the expected weather and climate conditions for prevention and mitigation of disaster risks in accordance with the Disaster Management Act 57 of 2002. The disseminated information includes the suggested strategies for day to day farming activities including sustainable agriculture. We continue to raise awareness on the impact and benefits of climate change to minimize the impacts of climate change in agriculture, forestry and fisheries production and productivity due to unexpected climatic hazards. We are currently developing a climate change adaptation and mitigation plan which puts emphasis on adaptation and mitigation measures that can assist to adapt and reduce vulnerability to climate change and improve productivity.
How has your Ministry worked with potential private investors? Have you had any investors that you would like to mention and do you have any stories of their successes?
The National Agricultural Marketing Council (NAMC) works closely with private investors such as farmers, exporters, farmer organisations, retailers, and agro-processing firms, on a number of issues that call for collaboration. Mention has already been made of the partnerships that have been created with Walmart/Massmart. There are other similar partnerships that we are actively pursuing with various private sector partners that we may not divulge for confidentiality purposes at this stage. The Walmart/Massmart project addresses everything that smallholder farmers require in order to be successful and have sustainable businesses.
The Department also participates in a public private partnership, which is led by the office of the President of the Republic of South Africa, President Jacob Zuma. This PPP promotes food production, especially in rural areas and on under-used communal land.
Can you recommend any agribusiness related activities in South Africa that would be open to private investors and that would be profitable and most beneficial to South Africa’s people?
South Africa is full of opportunities. There are many agriculture related opportunities that one can think about. One that I can think of is increased capacity in the soybean value chain. This is in line with the fact that South Africa produces and exports soybeans while importing soybean oilcake. The second to consider, which is more long term, is increased capacity in the mohair and wool value chains considering the proportion of raw wool and mohair that this country exports. Increased production of products such as paprika, cotton provides good opportunities to investors.
There are many such opportunities, and the area of aquaculture already mentioned is just one of these. Other areas of development include bio-fuels industry. The promulgation of a blending mandate will offer huge opportunities for the development of this industry.
On February 28th, 2013, you gave a speech on the occasion of BRICS provincial Road show in Kimberley, Northern Cape Province. In this speech you mentioned many of the international trade advancements and knowledge sharing South Africa is making with fellow BRICS members. You mentioned taking inspiration from urban gardens in Brazil; how much of South Africa’s food needs do you think an initiative for urban farming could achieve?
There is great potential in this regard, although it will not, on its own, solve the problems of food insecurity. What it does do is provide fresh food, mostly vegetables, which are often the missing ingredients in a nutritional sense. It also serves to develop among children an interest in agriculture, which will help build the next generation of commercial farmers.
During the February 28th speech, you also mentioned South Africa’s work with China via the Understanding on Agriculture Cooperation and the Cooperation Exchange in Aquaculture Mechanization agreements. Do you see South Africa’s growing relationship with China as a key to achieving food security and economic growth? In the long run, how do you see this partnership growing?
In 2012 we hosted a delegation from China and among the issues that they were interested in, is agro-processing. Their visit was coordinated by my department. This year, our colleagues will reciprocate that visit by travelling to China. This is to make sure that we create a platform for forging a clear understanding of each other’s capacities and to learn as much as we can, where possible.
In your BRICS speech, you also noted South Africa’s strong brand recognition in fellow BRICS nations. Do you see this brand awareness in other non-BRICS countries? How has your Ministry worked to promote the South African brand abroad?
The Department has offices in non BRICS countries such as the USA, Belgium, France, Italy and Switzerland as part of ensuring that South Africa is part of the global business network in the agriculture, forestry and fisheries sectors. Part of the mandate for these offices is to promote the SA brand whilst pursuing market access for our agricultural, forestry and fisheries products. We hope to open more foreign offices as part of our broader ambition to become active players in the global marketing chains.
What do you see as a role for Western-based agribusinesses in South Africa? Is South Africa open to Foreign Direct Investment and partnerships between local and foreign companies in its agribusiness market? Can you briefly describe any such current arrangements?
I suppose that a number of direct foreign investments in the food industry are viewed in perspective of their agricultural potential. The deal regarding Walmart/Massmart and its small scale grower scheme should be considered in this light. Foreign direct investment is always a good indication of the environment (country’s prosperity) and is accepted regardless of the country of origin as long as it will be customised to assist government deliver on its socio-economic commitment to the people of our country. We always encourage joint ventures between local and foreign companies whenever such possibilities arise.
Thank you very much for your insights.
Washington, D.C. (Aug. 13, 2013) – The Corporate Council on Africa (CCA) will convene its 9th Biennial U.S.-Africa Business Summit at the McCormick Place Convention Center in Chicago, IL, Oct. 8-11, 2013. The Summit is the premier event for finding and building partnerships with as many as 1,500 government and business leaders from the U.S. and Africa, as well as from Europe, Canada and Asia. Since 1997, CCA’s U.S.-Africa Business Summit has been regarded as an essential conference for anyone looking to do business in Africa.
“As perhaps the last emerging market on the planet, the continent is full of countries with the chance to develop the future, as no country has, through renewable energy, new ways of developing crops and through new infrastructure,” says CCA President Stephen Hayes. “For the United States, the 2013 U.S.-Africa Business Summit is the place to begin to synthesize those ideas into our own thinking and our own future, as new relationships are built in Chicago, and new ideas for the future emerge.”
A packed three-day event, the Summit will include over 32 workshops and plenaries, a trade expo and numerous special round table sessions, highlighting Africa’s most promising sectors, including agribusiness, infrastructure, energy, health, ICT, finance, capacity building and security. The conference will also focus on building new partnerships through exclusive networking events, including a Welcome Reception at the Art Institute of Chicago on Tues., Oct. 8, and a Sunset Cruise on Lake Michigan, Thurs., Oct. 10.
Other unique offerings include country-sponsored Doing Business Forums, which delve into the trade and investment opportunities offered by specific countries. As many as ten countries will be featured, including Ghana, Ethiopia, Mozambique and The Democratic Republic of Congo.
The campaign to host the event in Chicago was championed by Illinois Senator Dick Durbin. The location enables CCA to connect with hundreds of Midwestern companies that are ready for new markets, and are especially strong in the fields that favor American investment. “This region is where the strength of American investment and global agribusiness rests,” says Hayes.
Attendees will meet potential business partners and learn more about the Obama Administration’s new Africa-focused initiatives, as well as details on the continent’s important position in the global economy. Participants will have the opportunity to network with key African and U.S. private sector and government representatives, identify specific growth areas and hear detailed information about projects that are ripe for investment.
The Summit is sponsored by Chevron Corporation; Exxon Mobil Corporation; Dangote Industries Limited; Symbion Power; AllAfrica Global Media; The Boeing Company; General Electric Company; Freeport McMoRan Copper & Gold, Inc.; Groupe Jeune Afrique; Heirs Holdings, Ltd.; South African Airways; Acrow Bridge; Black and Veatch; Development Finance International, Inc.; Novus International, Inc.; Philips; U.S. Pharmacopeial Convention; Wal-Mart; Business Books International; Covington & Burling LLP; Dentons; DLA Piper; EMEA Finance; SAP Africa; Africa Agribusiness Magazine; Afropop; Bloomberg Businessweek and FT’s This is Africa.
For more information about the U.S.-Africa Business Summit and to register, visit http://www.africacnc.org.
About The Corporate Council on Africa
The Corporate Council on Africa (CCA) is a nonprofit, membership-based organization established in 1993 to promote business and investment between the United States and the nations of Africa. CCA is the premier American organization devoted to U.S.-Africa business relations and includes as members more than 180 companies, which represent nearly 85 percent of total U.S. private sector investments in Africa. CCA’s members range from America’s smallest to largest corporations. They represent a diverse pool of industries from more than 20 key sectors, including agribusiness, energy, infrastructure, security, power, healthcare, telecommunications and finance. Learn more at http://www.africacnc.org
The Oromia Coffee Farmers Cooperative Union (OCFCU) in Ethiopia—the birthplace of coffee—is the largest organic coffee exporter in the world. The union collects six types of high-quality, organic Arabica coffee beans, all with distinctive and highly desirable flavor characteristics, from more than 250,000 farmers across the Oromia region.
In only 15 years OCFCU’s exports have grown nearly a hundredfold, with sales of $40 million, making it the largest coffee producer and exporter in Ethiopia. Key to the union’s success has been to link Ethiopia’s smallholder farmers directly to export markets. The prior central auction marketing process did not allow for quality distinctions.
Beginning in 2000, ACDI/VOCA, a nonprofit development organization, aided the young cooperative union under a USAID program, training cooperative members to improve coffee quality and productivity, and working with farmers, processors, exporters and others to strengthen the overall coffee value chain in Ethiopia. Improvements included creating a system of traceability to guarantee coffee quality from farm to cup.
The general manager of OCFCU, Tadesse Meskela, recently reflected on the pivotal capacity building by ACDI/VOCA and others that spurred OCFCU’s growth. As one of the four panelists at a learning event held in conjunction with ACDI/VOCA’s 50th anniversary in June, he discussed his experience as a former aid recipient and recounted OCFCU’s progress. AAM sat down with him after the learning event for his perspective on capitalizing on export markets, effective marketing and next steps in helping the Ethiopian coffee sector to flourish.
AAM: What led to your cooperative union’s success over the past 10 years?
The key to success is promotion. As soon as Oromia was organized as a cooperative union, the challenge was getting the market.
With support from ACDI/VOCA, we came to San Francisco in 2000 [for a Specialty Coffee Association of America conference] with 146 kilograms of different coffees. Roasters took the coffee for free, cupped it and found that our coffee is the best.
It was eye-opening for us to learn how the coffee industry works in the West. Before that, we didn’t have any experience and did not know how coffee is consumed in the developed world. After coming to San Francisco we identified how people care for the product and what kind of certifications are required. In the first two years Oromia participated in the specialty coffee conferences with support from ACDI/VOCA. Since 2006 we have financed ourselves by renting a booth with fair trade coffee buyers.
The other thing is training—training to all the farmers. When we participated in the specialty coffee conferences we got feedback on the quality of the coffee. Based on this we trained our farmers so that the quality of the bean improves. In the 2012 Coffee of the Year competition, coffee from Oromia was the first out of 250 different coffees.
This is all because of the feedback we got from coffee roasters and the training we gave to our members to improve quality.
What are some of the current challenges for the cooperative?
We do have banks [OCFCU recently created its own bank, a great benefit to its members for much-needed preharvest financing] but still to capture the value chain, cooperatives have to receive all the product from their members, which would be facilitated by access to finance.
The other thing is capacity building. We have to train farmers from year to year. It’s not a one-time job, it has to be continuous. ACDI/VOCA supported us in the beginning. We have done a lot with ACDI/VOCA, but these trainings have to continue. It’s a dynamic process—training, awareness creation for farmers to get organized to come out of poverty—it’s very important. This is has to be accompanied by finance; they have to come together.
What are the techniques you’ve found most successful for training?
The way we communicated to members at the beginning of ACDI/VOCA’s intervention was through bringing in volunteers [ACDI/VOCA’s expert volunteers serve on short-term assignments that complement long-term projects] to talk to the farmers; so that has to be there.
We also use video classes on cooperatives to change the minds of farmers to enable them to come together, because we used to have bad cooperative experiences during the socialist regime, where farmers had no control over the product or pricing. So by the time we started with ACDI/VOCA, we had to educate farmers and show them how to change their lives through cooperatives by capturing the value chain, the comprehensive process of producing, processing and exporting.
You mentioned in ACDI/VOCA’s learning event that cooperatives receive 250 percent more by participating in OCFCU as opposed to selling to middlemen. Can you give an example of what the price difference would be for an individual coffee farmer operating alone?
Especially during the time of the coffee crisis, 2000, when the price was at a three-year low, 4 cents a pound, [by participating in the Oromia Cooperative Union] farmers were getting more than double what they could get on the local market. Even now they are getting more than double because we certify the coffee organic fair trade and trace all of it to the cooperative. So the certification creates an additional price over the quality. We are also given a quality premium from our customers because our coffee is always top of the top. These together give our coffee a higher price and make us able to give back dividends to the unions. So this is how the lives of the farmers change.
And also through the fair trade premiums [an additional payment above the market price that must be spent on social and economic development in the producing communities], we build schools and other infrastructure. We’ve built 14 elementary schools, 10 high schools and more than 100 clean water supply programs. All in all, we have done about 226 different projects from the fair trade premium—success we got by creating quality and sustainability and supplying good quality coffee to our customers.
Our relationships with our coffee roasters and buyers, who started buying coffee from us in 2002, are now family-like. They visit us every year or every two years. We visit them. They give us feedback and based on the feedback, we train farmers. Our relationship is very strong.
What do members do with the extra money?
You can’t say the money the farmers are getting is beyond their expenses, because farmers are living hand to mouth. The price of coffee is going up and down, so with the extra money they get they send their kids to school, they buy good food for their families, they change their houses from thatch to corrugated iron.
What do you think are the current constraints in the Ethiopian coffee sector?
The government needs to support characterizing the different coffees in the country. This has to be given a big emphasis, so that the country—and we—can win in delivering the high premium prices in the international market.
The biggest concern is agronomic. In most of the rural parts in the country the coffee is getting older, and there should be a stronger extension activity around agronomic practices. In the 1980s we had a coffee improvement project funded by the European Union for maybe eight years. That brought a drastic change to the Ethiopian coffee industry, with nurseries to raise coffee trees, training for farmers and stamping the old trees. This really has helped the industry. But since the culmination of the coffee improvement project, these programs are not there. So we have to work harder now.
Watch Tadesse Meskela and others discuss sustainable economic growth in developing countries at ACDI/VOCA’s learning event, “Moving Forward Together” here: http://www.acdivoca.org/site/ID/Video-50-Anniversary-Learning-Event
Approximately 870 million people in the world remain hungry. Moreover, 98 percent of them live in developing countries. The world’s population is projected to exceed nine billion by 2050, requiring at least a 60 percent increase in global food production. Under the aegis of Feed The Future, the US government’s global hunger and food security initiative, the US Agency for International Development (USAID) created a new program called Feed the Feed The Future: Parterning For Innovation and selected Fintrac, a woman owned and US-based consulting company that develops agricultural solutions to end hunger and poverty, to implement the program. Partnering for Innovation was launched in the fall of 2012 and will make approximately $50 million in grants to businesses, research institutes, universities, and other organizations by 2017. The program specifically looks for proven technologies that can be commercialized into new markets with a goal of helping smallholder farmers, especially women – who make up 43 percent of agricultural labor in developing countries – increase their efficiency and profitability in a commercially sustainable way. “Our grants program helps create incentives for companies by reducing the risk of entering into a new market,” said Brenna McKay, Grants Program Director for Feed the Future: Partnering for Innovation.
Partnering for Innovation funds technology grants through a process of two requests for concept papers a year, called “Expressions of Interest.” The program is currently accepting Expressions of Interest though July 31. Partnering for Innovation funds pilot testing and demonstration of proven technologies in new markets through one-year grants, as well as larger multi-year grants to bring a technology that has proven promising in a market to commercial scale.
Examples of technologies targeted include:
• New seed varieties
• Biological pest management products
• Animal genetics and vaccines
• Drip irrigation and water harvesting systems
• Production and postharvest mechanization
• Postharvest and value-added technologies
• Internet and cell phone technology
In addition to grantmaking, Partnering for Innovation is developing an online presence to share models and effective examples of agriculture technology innovations. Some examples
highlighted to date include:
John Deere started a tractor-equipment promotion program in Zambia in 2010 for maize farmers as a way to boost the output for smallholder farmers. Deere provided selected farmers with three-year loans to purchase tractors and equipment and gave them extensive training in how to provide services to other farmers. Of the 18 original participants, two have repaid their loans early and the remaining 16 are on schedule to pay off their loans. An unexpected outcome from this program has been more than a doubling of tractor units sold in the country outside of the program itself.
Blue Skies Holdings, Ltd., a fresh fruit processing and exporting company located in Ghana, is an outgrower scheme that has several unique features including: (1) locating its processing facilities close to its producers; (2) creating relationships with its outgrower farmers built providing reliable technical assistance and a market instead of producer contracts; (3) paying farmers within 14 days of receiving the product; and (4) monitoring and continually improving agronomic practices through training.Blue Skies employs 1,600 workers in its processing facility and works with several hundred smallholder farmers as commercial producers. It runs a state-of-the-art processing facility where hundreds of local employees clean, cut, process, and package fruit to meet the strict retail standards of the European Union (EU). The processing facility sources fruit from Ghana as well as from nine other West African countries to fill off-season production gaps and keep the plant running at capacity year round. An information and communications technologies system tracks seasonal planting, fertilization, pest management, and harvesting schedules. It also manages transport, airfreight, and departure and arrival schedules with its customers. “We didn’t start Blue Skies to be philanthropists. We give people work and pay them fairly,” said the founder of Blue Skies, Anthony Pile. The company accounted for more than 25 percent of Ghana pineapple exports in 2012. Blue Skies employs more than 2,000 seasonal workers, its management team, including the plant general manager, is 40 percent female, and on average Blue Skies’ smallholders earn the highest returns per hectare in Ghana.
Examples of Partnering for Innovation’s early grants that have been awarded in the past three months include:
Supporting Purdue University to introduce its low-cost grain storage bag (known as“PICS” or The Purdue Improved Crops Storage) in Rwanda to improve smallholder storage practices and reduce postharvest storage losses. Purdue, which has successfully brought its hermetically sealed plastic bags to 10 countries in West Africa for cowpea storage, under this grant will work with Kigali-based EcoPlastics—a commercial producer, distributor, and recycler of plastic products—to provide production and marketing capacity-building services for EcoPlastics to introduce the PICS bags for new crops such as maize and bean.
Another grant supports Driptech, a US company with offices in Pune, India. Driptech produces affordable, high-quality irrigation systems designed for smallholder farmers. The company distributes its products through local input agriculture supply shops, commercial exporters, and nongovernmental organizations. Founded in 2010, Driptech’s innovations include a process to produce low-cost plastic tape that delivers uniform water flow using a patented laser hole-punching process, and an easy-to-install “dripkit in a box” that can be installed in as little as three hours. This system is specifically designed with the smallholder farmer in mind. Driptech has begun working with two distributors, Champion Agro and The Global Green Company, plus a network of 250 independent dealers to begin to reach some of the estimated 600 million smallholders in the Indian market. “Ninety percent of the world’s farmers are small plot, meaning they work on five acres or less. Drip irrigation, which already existed, is the best solution, but everything on the market was too expensive,” said Driptech founder Peter Frykman in a recent article in Forbes Magazine. “In designing for emerging markets, you have to be excruciatingly sparse,” he added. Thus, Driptech’s mantra is “radical affordability.”
Seventy percent of the world’s cocoa comes from West Africa, and Partnering for Innovation is funding the World Cocoa Foundation and its partners (including the Grameen Foundation and mobile phone company Orange) to provide farmers with the know how they need to increase their yields, quality, and income. In Cote d’Ivoire, a pilot for the new CocoaLink+ mobile platform will enable lead farmers called community knowledge workers to provide their neighbors with up-to-date agronomic information on pest and disease control, purchasing and using inputs, planting, postharvest handling, and other practices that improve yields and quality. CocoaLink+ goes beyond SMS mobile extension systems by allowing for multimedia access for demonstrations of plant care, geographically specific guidance on procuring quality inputs, access to pest management services, and tracking of farmer productivity from season to season. In addition to local delivery of extension information, cocoa farmers who subscribe to CocoaLink+ will receive and share practical information with industry experts via SMS text and voice messages in local languages.
• Working with PortaScience, Inc. to improve milk productivity and quality for smallholder dairy farmers in Rwanda with an inexpensive and easy-to-use udder infection detection technology called UdderCheck™. The dipstick allows farmers to more easily and inexpensively detect mastitis infection early on and reduces the extreme losses in milk that result from late-stage infection. When dipped into fresh milk, UdderCheck detects an enzyme, Lactate Dehydrogenase (LDH), which is present when cells are damaged due to infection. In two minutes, the strip, which costs less than $1, will change colors to indicate moderate, high, and very high levels of LDH infection. In Rwanda, it is estimated that mastitis losses amount to more than $400 per cow per year, amounting to a total annual economic loss to the country of $3.5 million. With an increased number of smallholders owning dairy cows, early low-cost detection of udder infection is critical to the viability of the dairy industry.
According to Partnering for Innovation’s Director, Bob Rabatsky, “There have been many changes in agriculture in the past two decades, and in the next two decades Africa is going to be a good place to invest in agriculture. I have no doubt it is the sleeping giant.” Partnering for Innovation aims to help those who offer the base of the pyramid market with financing and other assistance to jumpstart their agriculture technology sales. For more information on Feed the Future Partnering for Innovation,
Written By Deborah B. Hamilton, Communications and Knowledge Management Lead, Feed the Future: Partnering for Innovation
All Photos by Fintrac, Inc.
It is a widely agreed and accepted fact that Africa is a continent positioned for growth as never before. As the second largest continent on earth, and home to more than a billion people, it boasts a vast and highly varied plethora of fertile ecosystems, including mountains, grasslands, lakes, savannahs, tropical rainforests and volcanic calderas. Africa now heralds itself as the newest beacon of explosive economic growth and prosperity.
Only last month, U.S. President Barack Obama met with leaders from four African countries: President Macky Sall of Senegal, President Joyce Banda of Malawi, President Ernest Bai Koroma of Sierra Leone, and Prime Minister José Maria Pereira Neves of Cape Verde. They met to discuss strengthening democratic relations, increased good governance, sound management of public funds, transparency and accountability from elected officials and much more. In general, the big picture was focused on promoting economic opportunity on both sides of the water and African leaders heartily supported doing so, not just in their own countries, but also across sub-Saharan Africa.
While it is also agreed that the continent presents a unique set of challenges, as Angelle Kwemo tells us in “Cameroon – the gateway into the Gulf of Guinea region,” she also reminds us that “there are many policy challenges and institutional barriers to overcome.” There are, however, also many Africans now enjoying a certain degree of economic liberation and hopefully, these numbers will soon be increased. Yet, we also know, that there remain many who are not. With regard to agriculture, many famers could stand to win big and reap plentiful benefits by increasingly learning to better leverage their resources when entering this new market-driven economy—and especially women.
Africa is booming but in terms of agriculture, the noise seems to be getting a lot louder. Additional proof? The World Bank’s recently released “Growing Africa: Unlocking the Potential of Agribusiness.” This 120 page report predicts that Africa’s agricultural sector could command a US$ 1 trillion presence in Sub-Saharan Africa by 2030 if African farmers have increased access to financing, new technology, irrigation and fertilizers, and can upgrade their techniques and practices.
According to the report, “agriculture and agribusiness together account for nearly half of GDP in Africa. Agricultural production is the most important sector in most African countries, averaging 24 percent of GDP for the region.” They see a growing demand in both domestic and global markets, in spite of Africa losing out competitively against countries such as Brazil, Indonesia and Thailand.
Yet, realizing even the most basic benefits for Africans such as increased food security and health, (along with income and prosperity) also means realizing the importance and necessity of inclusion for all stakeholders in this vast sea of changes taking place today.
If Agriculture is taking center stage, who’s at the center? Smallerholder farmers. Who’s at the center of the center? Women. Women are the backbone of African agriculture (and of the world, in general). Women are major stakeholders and their voices should be included in the discussion forming the policies that will directly affect them.
A key challenge and recurring theme, and especially for women farmers, has been one of inclusiveness, after all, women farmers do make up 70% of the smallholder farmers in countries such as Kenya, Nigeria, Uganda and Rwanda as recently reported in AAM by Katie Campbell, a senior policy analyst at ActionAid USA in “Farmers have their Say on Agricultural Investments.” Ms. Campbell reports on the 2012 annual CAADP Africa Forum, the theme of which was “Farmer Organizations as the Vital Link to Equitable and Sustainable Agriculture Growth in Africa.” Attended by more than 300 participants, from 46 African countries (mostly farmers), it was the first to be hosted entirely by farmer organizations.
Recently CAADP, joined by women from Nigeria, Uganda and Rwanda as part of a campaign, encouraged African governments to invest in women smallholder farmers. When referring to women farmers, Campbell reveals that smallholder farmers “usually…do not know how to ask the government for what they deserve, but that with this training they now will be able to advocate to their officials. As one female farmer reported, “We hear of seeds that the government gives out but we haven’t been able to get them. We are now preparing ourselves to be able to engage finally.” Women are reaching out, engaging and asking their elected officials the what, where and how of ways they can succeed.
This is where governments and investors can truly get involved in bringing about the changes they want to see, giving birth to ideas that can bring to fruition to the many initiatives surrounding food insecurity, improvements in health, decreases in poverty and the overall well being of the peoples and the continent. And there is also that extra-added benefit: There happens to be a lot of money to be made in the process.
Another organization working assiduously to help educate and engage women farmers is ACDI/VOCA, a U.S. development organization specializing in broad-based economic growth. As you’ll learn from their article in AAM, “Sell More For MoreTM: A Clear Path For Helping Farmers Access Better Markets and Earn More Income,” [Link to article] ACDI/VOCA shows how crafting this system of innovations engaged impoverished farmers by developing their farming skills and helping them access profitable markets.
Sell More For More™ shows how training 60,000 farmers in Rwanda in post-harvest handling and storage, resulted in quadrupled income for some: “Suddenly, for the first time in her life, Odetta had more money than she needed.” Sell More For More™ was recently awarded a Best Practice and Innovation award by InterAction, a large alliance of U.S.-based NGOs.Opportunities Industrialization Centers International (OIC International), an organization founded in 1970 and headquartered in Philadelphia, PA, operates both in the U.S. and several African countries and also offers a number of programs which work closely to advance the prosperity of women farmers. Their goals include improving production and sustainability, helping provide women farmers with better seeds, improved livestock and in obtaining the much-needed skills needed to start their own small businesses. As ActionAid USA, OICI and many others firmly believe, African agriculture only stands to benefit through including farmers, farmer organizations, and especially women as true stakeholders into this unfolding dynamic. If investments are truly to succeed, for all involved, inclusion is key if not mission critical.
As Angelle Kwemo, President at A StrategiK Group LLC (and former Legislative Counsel for Congressman Bobby Rush), notes during a recent interview with African Connections, a U.S. Department of State podcast channel, “Ten years ago, nobody had the data to really determine the impact of the role of women in the economy, but it’s clear that if you empower women they have a direct impact on the community. Eighty-five percent of their income goes to the family compared to men, which is only 40 percent.”
Ms. Kwemo also offered the following advice toward further growing women’s roles: “You have to train them, educate them. Many people don’t know this, but 85% percent of the cocoa farmers in Ghana are women. Give them the tools and the technology and help them learn how to manage their farms, their accounts, their budgets and even the micro loans.” There are an abundance of organizations that have initiated and developed powerful and successful programs dedicated to advancing farmers and women. They are zoning in with a laser-like focus on forming new partnerships for future development opportunities with Africa that will help the country further harness its potential and empower the next generation of leaders. It may go without saying, but increased prosperity and well being for women means increased prosperity and well being for all.
How can and will you play a more integral part in this evolving process of increased economic prosperity—for the continent, for women and for all?
According to the International Fertilizer Development Center, agriculture accounts for forty-five percent of Ethiopia’s GDP and eighty-five percent of employment.
Furthermore, Ethiopia has roughly fourteen million hectares of arable land and is the headwater for the Blue Nile. With all of these resources one would imagine that Ethiopia would be easily food secure. Unfortunately, underdevelopment and an uneven concentration of easily accessible potable water has left Ethiopia in a jam. Having been unable to feed itself, Ethiopia has had to rely on food aid in recent years. However, the Government of Ethiopia began to take it upon itself to solve its own food security needs and seems to be on the right track with some great allies.
In order to support the Government of Ethiopia’s strategy for developing agriculture, which is outlined in its Agriculture Growth Plan, the United States Agency for International Development (USAID) and DuPont recently announced collaboration with the Government of Ethiopia to support farmer productivity by delivering hybrid maize seed, improving seed distribution, and building post-harvest storage. The Advanced Maize Seed Adoption Program (AMSAP) is expected to impact over 32,000 Ethiopian farmers, helping them to increase productivity by fifty percent and reduce post-harvest losses by twenty percent.
Organizations such as USAID and DuPont are stepping up to the plate and working together to support farmers in Ethiopia. According to a USAID press release, the collaborative agreement with the Government of Ethiopia will “boost maize harvests through increased use of DuPont Pioneer maize seed, improved seed distribution, and post-harvest storage”.
As outlined in its letter of intent to support the G-8 New Alliance initiative and Grow Africa,
DuPont plans to invest over three million dollars during the next five years in Ethiopia. This partnership was built off of an existing commitment between DuPont and Ethiopia in 2012.
DuPont is using one of its subsidiaries, DuPont Pioneer, the leading US producer of hybrid seeds to implement the program along with USAID and the government of Ethiopia.
Lystra Antoine, Director of Agriculture at DuPont Pioneer talked with AAM staff and discussed DuPont’s involvement in Ethiopia’s agribusiness sector. “Within three years DuPont plans to reach 32,000 farmers through the AMSAP program, ” said Antoine. “The program will support the entire maize value chain, providing inputs, agronomic expertise, create a dealer network, build storage and marketing channels, and support the existing government infrastructure for the maize industry in 16 woredas.” Using the model farmer approach, the collaborators expect that the program will be scalable and replicable across Ethiopia.
DuPont Pioneer has been selling seed in Ethiopia for over 20 years, and its hybrids perform well as many local farmers will testify. Most of this new effort is focused on empowering local farmers to meet their country’s food needs. Pioneer’s efforts are multifaceted and work in conjunction with USAID and Ethiopia’s government.
“The fact that the Government of Ethiopia has its own Agriculture Growth Plan allowed us to design the AMSAP in support of their strategic priorities for the maize sector,” said Antoine.
This collaboration advances agricultural development and food security goals set by the Government of Ethiopia and supported by USAID through the U.S. Government’s global hunger and food security initiative, Feed the Future, which is part of the U.S. contribution to the New Alliance for Food Security and Nutrition.
The AMSAP program will train in local languages and will demonstrate to farmers what they need to do to improve yields. There are community cooperatives and farmer training centers currently and Pioneer is working with them as well. By working on improving market linkages, farmers will be able to more easily get their crops to market.
Storage is very important to improve because as much as fifty percent of harvest can be lost. Currently farmers have very little capacity to store the seed for any length of time. Insects and diseases can attack the seeds themselves. The program expects to decrease post harvest losses by twenty percent.
The program plans to build individual and cooperative storage facilities where farmers can amass their produce. Using storage could also drastically increase the livelihoods of small holder farmers if they were to strategically sell their produce when prices are higher.
Some farmers are initially concerned about hybrid seeds. “Once farmers experience the increased yields from improved seeds, they usually choose to continue planting hybrids.”
Pioneer will provide sample seed to farmers and set up demonstration plots where hybrid and open pollinated varieties are planted side by side.
The AMSAP program’s training of extension services and seed distributors does not limit the seeds available to Ethiopian farmers. Antoine states that, “Under this program dealers can sell Pioneer as well as any other seeds. This way farmers maintain their ability to choose the seed that they wish to plant”.
Long Term Goals:
Pioneer hopes to be able to expand its current initiatives in conjunction with USAID and Ethiopia’s Government.
“We want to be modest in what we place as targets, but we certainly know that there are huge benefits to be had from just having the right storage facilities and allowing the farmers to understand their strengths in negotiating when to sell.” Antoine explained. Pioneer also plans to train farmers to become dealers for cooperatives to sell produce at the correct times. “Farmer Dealers” by the end of three years should become a much wider distribution network.
The Benefits of Hybrid Seeds:
Erratic draughts and floods are a problem that advanced certain seeds can help with shorter maturity times so more can be harvested faster. It can even be possible to have multiple harvests in a season with the correct conditions. They are also more resilient and can withstand more detrimental weather. Furthermore, the yields from these advanced hybrid seeds typically increase fivefold.
Pioneer is not currently using mobile phone technology for training in Ethiopia but fully support the use of technology for training, communication agronomic advice, and market information. Lystra states that this technology “could be a vehicle for technical assistance well worth pursuing” and Pioneer is definitely looking into using mobile phone technology to bring technical assistance to farmers.
They rocked the house and rock the house they did! One by one, people began rising from their seats in the World Bank atrium, holding up their hands, clapping to the beat and then singing (or dancing) along with the performers —at the tops of their lungs. Adults, youth (teenagers), children, the millennials, the middle-aged and elderly had the floor vibrating in rhythmic excitation.
On Friday, March 1, 2013, the World Bank, in partnership with the Italian Ministry of Environment, the Global Environment Facility (“the GEF”), and in collaboration with more than 150 knowledge partners, honored and awarded youth from 14 countries at their recently launched Connect4Climate (C4C) event in Washington, D.C.
Organized and produced by Lucia Grenna, the C4C program director and veteran World Bank employee who nurtured the project from its nascent stages, and hosted by John Raatz, the Master of Ceremonies along with MTV’s Izzy Lawrence, C4C got the word out through music and creative dance skits that created excitement, energy and participation. The strategy? Using music and artists of every medium to celebrate youth engagement in combating the effects of climate change, as “intellectual arguments” seemingly fall on deaf ears or, are simply not enough to effectively communicate the truth of what the world is really facing. As a result of climate change, it’s become a whole different game and it is imperative for us all to connect, move in unison and make waves like a school of fish.
Makhtar Diop, from Senegal and Vice President for the World Bank’s Africa region, spoke briefly of what for several years, is being experienced in his home region, the Sahel. “For us,” he said, “a change of 2 degree doesn’t mean something we want to address in conferences. It means less water for us, it means drought in our area. When my friends from Mali are facing hardship…when in the western part of Kenya, in Nyanza, you see flooding and mud slides, it is because of climate change…it is something we are living everyday.”
Diop also acknowledged the current growth happening on the continent of Africa and how Africans are “doing things so right.” In terms of climate change, we don’t want to set ourselves back 10 years. “We can’t afford it,” he said. Africa can’t afford it and the world can’t afford it. He expressed delight and honors to see a coalition growing across the world and believes that without the support of not just the youth and civil society, but of all artists in the world, change is possible. Diop offered the example of the many artists in Africa who have successfully shown the ability to change things like HIV/Aids. “Their role has been tremendous.” They all stand as voices of hope.
World Bank Group President, Jim Young Kim, heartily applauded the winners, encouraging youth around the globe to take a more active role in combating the climate change. “We’ve got to connect in a very different way now,” said Kim. “Connect4Climate is important because we have to take this struggle to a different level. We have been talking about the numbers…we have said all of the numbers again, and again, and again. But what we have failed to do yet is actually connect.” Kim brought it home, stating that the issue of climate change has now become a “very personal” one. As the father of two sons, ages twelve and three, he noted that if nothing is done to combat climate change, by the time his three year old reaches his own age, extreme weather events, struggles over food and access to water could be so rampant and commonplace (globally), he can just imagine his son living in that time and saying every day: “My father was the president of The World Bank. What did he do when he knew? When he knew that this was going to happen?”
The Italian Minister for the Environment, Corrado Clini, to great applause, briefly addressed the audience, encouraging all to support the project and help create a global community toward helping the planet recover from the changes occurring around us. “It’s fundamentally about family values and the world we’re leaving to our children, but this is the world we are living in right now.”
Rachel Kyte, the World Bank’s Sustainable Development Network Vice President, offered a chilling thought. Namely, that helping to exacerbate the effects of climate change won’t be possible without “all of us.” We have to ask ourselves “what am I prepared to do?”
Among the winners for the competition, Africa scored big in nearly all categories and across several countries, including Nigeria, Cameroon, Kenya, Mozambique, South Africa, Namibia, Uganda, Zambia, Malawi, Morocco, Somalia and South Sudan.
In the Agriculture category for 13-17 year olds, Josephine Nakanwagi won 3rd place for “Soil Erosion #1”. Under Jobs and the Green Economy, Jason Hanslo, South Africa (13-17 year olds), won 2nd place for “Adding Sunshine to the Sand” and Ngalim Njaiwo, Cameroon, took 2nd place for “Talent + Environment = Employment” in the 18-35 age grouping. Joana Simões Piedade, Mozambique, won 1st place in the 18-35 year old category for “A Day at the Office”. She also won 3rd place, Namibia, in the Water category (18-35 age group) for “Drinking Problem”.
Under the “Cities” category, Christena Dowsett, South Sudan, took 3rd place in the 18-35 age group for “Cities 01”. Coming in 2nd place in the Energy category for ages 18-35 was Evanne Nowack, Uganda, for “Daring to Invest”. Patience Moyo, Malawi, won 1st place among the 13-17 year olds for “What Policy Makers Should Know About Energy” and Nancy Saili, Zambia, won second place in the 18-35 year olds category for “Death of our Zambian Forests” under the Forests category. The Gender category produced three winners in the 18-35 category, 1st place went to Adil Moumane, Morocco, for “Suffering of Women”, Anab Garad, Somalia, was the 2nd place winner for “A Long Walk”, and Maash Sheik Hussein, Kenya, won 3rd place for “Wajir County”. Ray Blount, also from Kenya, took 1st place in the Health category (ages 18-35) for “Dumping Site”. This same category saw Christena Dowsett, South Sudan win again. This time in 2nd place for “Health 01” and Violet Moyo, Malawi, won 3rd place for “Infested Environment.” In the Music Videos category, Idamiebi llamina-Eremie, Nigeria, won 3rd place for “We Be”.
“Not Afraid”, a music video by Kenya based artists TS1, won 1st place in the global Voices4Climate competition and was performed live in the World Bank’s atrium to a crowd of no less than 400 attendees. TS1’s feat of an Eminem song used music more than creatively to address not only climate change but also the plight of the human race, if we don’t pay attention. We may all live in different corners, as the song says, “but in denial we fall.” This song…these kids…ROCKED the World Bank atrium and stairs! It’s a very cleverly worded and powerful song that resonates with you and one that you likely won’t be able to stop listening (bobbing to) and singing, again and again. Special guest and award-winning Malian musician, Rokia Traore, also blazed the stage with her soothing sounds. The evening’s end found attendees dancing on the atrium floor, the stairs, everywhere really, singing the words, “I’m not afraid, to take a stand.”
TS1’s song, along with the other artists, can be found on the CD “Rhythms Del Mundo-Africa” which also includes tracks by Beyoncé, Coldplay, Bruno Mars, Mumford & Sons, and many more. All attendees were given a complimentary copy. To view the video click on: http://www.youtube.com/watch?v=QI8KiVrIOvs or visit YouTube.com and type: Rhythms Del Mundo Africa feat Eminem & TS1 Not Afraid in the search window.
C4C’s goal is to create a participatory, open knowledge platform that encourages the global community to join the climate change ‘conversation.’ They hope to encourage action, drive advocacy, operational support, research, and capacity building on the local level. C4C is judiciously engaging the world through social media and the web, amplifying the voices of artists and local stakeholders with stories to tell about climate change and inviting youth and all us to do so as well.
While Connect4Climate has already produced a number of events and competitions, the ball is still rolling. Their next globe trotting competition –iChange- challenges students between the ages of 18-35 to create a “sharp” 30-second video message about climate change, telling a story that will heighten awareness and which will incite action and inspire change. If as the TS1 tells us “we’re not afraid to take a stand,” in combating the effects of climate change, the possibilities are limitless and certainly better than the alternative.
The presidents of two Rwandan cooperatives outside a newly-built storage facility to benefit both co-ops
Farmers drying maize outside a cooperative in Rwanda.
Sell More For More™: A Clear Path For Helping Farmers Access Better Markets and Earn More Income
By January most farmers across Rwanda have just passed through the country’s lean season and are welcoming the harvest. But getting through the months of scarcity can mean disassembling important household investments—choosing between school fees or fertilizer, food today or food tomorrow.
Helping farmers achieve volume production and reach new markets would allow them to protect gains—even through the lean season. Achieving those ends, succeeding in the ever-challenging “how-to” of reaching smallholder farmers with services, technology and training, is complex and difficult; but one such initiative has had measurably positive results in Rwanda—Sell More For More™ (SMFM).
Sell More For More™ is a system of innovations designed to engage impoverished farmers, develop their farming skills and help them access profitable markets. Sell More For More™ was crafted by ACDI/VOCA, a U.S. development organization that specializes in broad-based economic growth. The name itself articulates how the program works: helping farmers sell more (in quality and quantity of product) for more (increased revenue), ultimately empowering them to produce top quality product without sustained assistance.
Results have been striking. In Rwanda, Sell More For More™ trained nearly 60,000 farmers in post-harvest handling and storage, and 93 percent of them went on to earn more income. The program recently won a Best Practice and Innovation award from InterAction, a large alliance of U.S.-based NGOs, and in a speech, Bill Gates singled out Odetta, a SMFM-trained farmer, saying: “In one year, her income quadrupled. Suddenly, for the first time in her life, Odetta had more money than she needed.”
William Sparks, ACDI/VOCA’s vice president for program services details the Sell More For More™ program at InterAction’s Best Practices and Innovations award ceremony.
Strengthening the Value Chain
The program began as a collaboration between the World Food Program (WFP) and USAID in Rwanda in 2010 to address constraints in post-harvest handling of beans and maize. WFP is a large-scale buyer and one with an important mission. Its local purchase program, Purchase for Progress (P4P), provides a lucrative opportunity for smallholders. It also acts as a bellwether: once cooperatives meet strict WFP standards, the broader market realizes that the same co-ops, and perhaps others like them, can reliably provide buyers with high-quality product at scale. Moreover, helping local farmers sell to the WFP provides more efficient food aid procurement, with quicker turnaround and less loss.
ACDI/VOCA is known for its work in value chain development: strengthening the proficiencies of, and the ties among, actors that influence the movement of a product through various stages of production and distribution until it arrives in the hands of the final customer. SMFM trainings aim to improve these proficiencies, as well as reduce constraints in these connections for lasting improvements in farmers’ incomes.
For a smallholder cultivating a few hectares in Rwanda, selling maize to a demanding big-scale buyer, say, the World Food Program or the Rwanda Grain and Cereals Corporation, is a quantum leap in business activity, and the prospect can be daunting. Instead of focusing on individual farmers, SMFM organizes and works with producer groups to efficiently inculcate the necessary skills, disseminate information and build confidence. These groups can also exercise market clout, increasing farmers’ access to bulk input providers, cultivation services, crop aggregation and storage capabilities. However, their member farmers typically lack the skills to take full advantage of these efficiencies. Shedding light on these farming and business processes and upgrading the requisite skills is where SMFM has been successful.
ACDI/VOCA Vice President for Program Services William Sparks accepts the InterAction award.
Training to Improve Post-Harvest Handling and Storage; Building Capacity in Business and Marketing
Post-harvest losses in Rwanda are substantial. Improper threshing techniques, poor transportation and storage facilities and a lack of oversight frequently result in losses exceeding 20 percent of the maize harvest. In addition to physical loss of product, prices paid to the farmers may be reduced due to discoloration, insect infestation, damaged kernels and aflatoxin build-up. Sell More For MoreTM trains farmers on ten specific post-harvest skills in areas from shelling to cleaning to storage, significantly reducing losses.
At the same time, SMFM works to build the capacity of cooperatives and farmer associations in business and marketing. For example Sell More For More™ helped the COAMV cooperative, which aggregates maize and processes it into flour in northwest Rwanda, secure a grant to improve its storage facilities. With better storage and a new training component designed to decrease post-harvest losses, the cooperative improved its position enough to access credit, enabling farmers to pay for children’s school fees and medical insurance. Through SMFM business plan development, COAMV is learning how to increase working capital, which should propel growth. The co-op was recently awarded a certificate from the Rwanda Bureau of Standards confirming its compliance with new health and hygiene standards, which again will help increase its market share.
The combined trainings have helped farmers reach new markets. Eighty percent of the farmer organizations trained in SMFM met the Grade 1 standards required to sell to the World Food Program, a large jump from the 47 percent pass rate of those not participating in the program.
“The impact of the Sell More for More™ trainings has been invaluable,” said Emmanuela Mashayo, World Food Program’s Purchase for Progress (P4P) coordinator in Rwanda. “We have seen marked improvement in the quality of the maize being produced, as well as in the leadership capacity of the cooperatives’ management. We are now able to purchase with confidence from those cooperatives who have undergone this training.”
Over the years, many other initiatives have trained farmers, of course. Some have fallen short because the approach was not conducive to adult learning or the message did not reach the impoverished farmers who need it most. SMFM made significant inroads in these areas using three signature components:
The presidents of two Rwandan cooperatives outside a newly-built storage facility to benefit both co-ops.
“M3” –Money, Membership, Management: Assessing Cooperatives
Farmer organizations begin with a participatory assessment known as M3.It addresses 26 topics relating to money management, membership development and overall management and governance. A simple, narrative survey helps organization leaders identify current priorities, and a participatory process teaches them how to self-assess their organization in the future. The results of this survey help members prepare for the training they will receive through the SMFM leadership kits.
Leadership Kits: Effective Trainings for Cooperative Leaders
To improve management skills, Sell More For More™ relies on leadership kits. Each leadership kit has four modules and each module is a three-day workshop delivered to approximately 15 current and emerging cooperative leaders. Workshops are conducted with two cooperatives at a time to facilitate sharing of experiences and encourage future collaboration. For example, after completing training together, two neighboring co-ops decided to build a joint storage facility in the Kirehe region of Rwanda that neither could afford independently.
Further, the trainings are participatory instead of passive, calling for farmers to help each other learn. Evariste Kaberuka, president of the Ibyizabiri Mbere Cooperative in Rwanda, commented that the lessons “fully engaged the entire cooperative,” creating an “immense amount of excitement.” To keep the trainings energetic, SMFM employs a 5/25 rule: for every 5 minutes of lecture time, 25 minutes is spent on a group activity designed to foster participant sharing of information.
Displaying the STICKS tool
Lastly: Helping Lead Farmers Teach Others Effectively
SMFM uses a “cascade” train-the-trainer approach to create a multiplier effect. This helps SMFM reach the entire membership of a farmer organization. In Rwanda ACDI/VOCA worked with 95 cooperatives to train 1,770 lead farmers in best post-harvest handling practices. These lead farmers each trained approximately 25 more farmers. This led to 44,590 cooperative members trained in improved maize handling.
The SMFM program provided lead farmers with a specialized tool called STICKS (Scalable Tracker for Imparting Certified Knowledge and Skills) to ensure that lead farmers taught new techniques consistently, that they were incentivized to follow through on conducting the trainings and do them well, and that they could track the newly-trained farmers. ACDI/VOCA designed the STICKS instrument to be a durable, double-sided poster that is a mainstay of the lead farmer training toolkit. It shows graphically the major post-harvest handling skills to be mastered. It also contains the lead farmer’s credentials and has signature lines on which each trainee puts his or her name. The poster can be rolled up and easily carried anywhere, for lessons in fields or classrooms. It is often proudly displayed in the lead farmer homes or farmer group headquarters.
Other Factors Contributing to Success
In addition to the comprehensive SMFM project design, additional factors contributed to success in Rwanda. Of instrumental importance, the government encourages cooperatives, supporting them at the highest levels.
Rwanda also emphasizes gender equity. It has the highest percentage of women participating in a parliament in the world. Supporting women is a policy practiced across social, economic and political spheres. Since women perform a majority of the production and post-harvest work in developing countries, being able to increase technical skills of women quickly and easily is crucial.
Two cooperative presidents inside their new, jointly-owned storage facility.
Finally, there was effective donor collaboration. Support from USAID and its partner organization, WFP, allowed the project to become successful.
SMFM marches on. It is currently being replicated in Ethiopia, Tanzania and by another organization in Rwanda.
William Sparks, vice president of program services at ACDI/VOCA, said, “Sell More For More works through farmer organizations to transform the lives of smallholder farmers. With collaboration and enhanced skills, farmers in the most remote locations can now access profitable markets and provide for their families. That’s what this is all about.”
About Blumberg Capital Partners
Blumberg Capital Partners, headquartered in Miami, Florida, is an independent, privately held investment firm. Although neither overly aggressive nor exotic in their approach, Blumberg Capital Partners has produced among the strongest returns in the country. The firm co-invests in all funds, and by operating fully institutional investment funds they have the agility needed to be successful in today’s market.
Blumberg deploys its innovative offerings and expertise all over the globe to address critical resource and infrastructure challenges. These challenges include infrastructure, such as food storage and security, the sourcing of rare earths and strategic resources, manufacturing, and the productive management of real estate assets. While the projects are varied, the Blumberg process is the same in every case – a very disciplined system of risk-managed investment and experienced management that has produced industry-leading results for more than thirty years. (Source: Blumberg Capital Investments)
Blumberg’s investment discipline emphasizes stability and preservation of capital. To limit downside risk in cyclical markets, the use of leverage is very moderate compared to industry averages. As Mr. Philip Blumberg, Chairman and CEO, explains, “We at Blumberg Capital consider investing other people’s money to be more precious than investing our own. We do not risk or endanger investments, rather we pay a lot of attention to market cycles, individual focus on managing investments, and apply conservative risk and financial management strategies to our projects and investments.”
Blumberg’s agricultural roots reach back to the 1800’s in the United States; and today, they are proud to help entire nations manage their food supply with greater safety and security.
Recently Africa Agribusiness Magazine had the pleasure of speaking with Philip Blumberg, Chairman and CEO of Blumberg Capital, to discuss how their agriculture initiative, Blumberg Grain, can provide innovative solutions to Africa.
Blumberg provides countries and companies with state of the art and comprehensive storage units for post harvest food safety and security. Mass produced in the United States, the lightweight, scalable warehouses use one-third the steel of conventional warehouses, making them the most cost effective storage facilities in today’s market. However, the simple design does not hinder the structures’ expected lifespans, which is estimated at 25-50 years.
Furthermore, each self-contained facility can be customized for farmers’ needs. “Despite their simple design, these warehouses are quite sophisticated. It’s what we can do inside that makes all the difference,” said Philip Blumberg.
By design, Blumberg warehouses can be divided for multiple products, and each area can have its own sophisticated temperature, insulation and humidity controls. To operate the facilities, countries may choose from generator, solar or wind power. What’s more, Blumberg structures are designed to work in rural areas, close to the farmers and their crops, so that harvested crops are stored as quickly as possible. The units also serve as large distribution and collection facilities.
After the modules are shipped to the host country, assembly begins. One key advantage is that these warehouse buildings can be installed and working in as little as 3 days. Blumberg works directly to train the local workforce to assemble and run the facilities. “We are committed to hiring the majority of employees from the local job market,” says Mr. Blumberg.
Blumberg Grain provides the most comprehensive, state of the art management for post harvest food safety and security. Effectively managing the stored grain is essential to ensure that the grain remains at its highest quality throughout its time in storage.
“We have a highly regarded and innovative grain storage system being applied globally,” said Philip Blumberg.
Blumberg provides the following strategic stockpiling and trading services, particularly for countries and companies that import grain and agricultural products, where an assured supply and pricing is important.
Systems and Procedures
Blumberg Grain utilizes a system of procedures to assure the proper maintenance of each unit providing the ability to store grain with confidence in order to achieve the highest possible market premiums. Additional procedures may be implemented that are specific to each individual facility, inventory type and location.
Blumberg Grain management relies on a proactive approach to grain and perishable storage management, to immediately recognize potential problems, determine their causes and effectively resolve the issue. Additionally, Blumberg Grain employs skilled service technicians specifically trained to monitor, control and maintain Blumberg Grain storage units.
An educated and skilled work force is critical to the development of a more productive workplace and is essential to foster economic employment growth and development. Blumberg is committed to employing at least 80% local work force and to provide them with the training and skills for advancement in the organization.
(Source: Blumberg Capital Partners)
[quote align=”center” color=”#999999″]“Innovative food storage solutions have the capacity to transform Africa. In nations where agriculture is the largest incremental economic contributor, if you eliminate 50% of product loss without plowing one new acre, farmers double productivity. This then becomes the largest direct contributor to a nation’s increase in GDP.”[/quote]
Transformative Economy through Agriculture
The Blumberg Grain food storage systems have the capacity to provide significant impact—perhaps the single most significant impact that can be made on post harvest yields—by securing food for a country’s people and guaranteeing the quality and quantity of exports.
When farmers and countries gain the ability to adequately stockpile agricultural products the economic picture changes. No longer forced to immediately sell a product, they can now analyze the market and choose when to sell and how to price the product. With this sophisticated type of market, the control goes to farmer and/or country, as there are options for the future. And in terms of food security, products no longer perish and are available when needed by the community, country or region.
The positive aspects of an options market such as this include (1) the ability to protect against declining crop prices while retaining the opportunity to gain if prices rise, (2) increasing marketing flexibility while lowering risk in case you price your crop before harvest but yields are severely reduced by adverse weather or disease, (3) opportunity to fix in a price before harvest to avoid unforeseen risk and (4) the fact that options markets can be a less complicated tool to hedge risk than direct sales in the futures market.
As Blumberg cites as an example, “If a farmer evaluates the harvest market and determines that the market is being flooded and depressing prices, he can harvest his crop but then store it in a Blumberg warehouse for 4-6 months, at which point he can receive a premium of up to 50%. This improves the economics and supply of the value chain.”
Blumberg Grain will be opening five manufacturing plants and export Hubs across emerging markets. For Sub-Saharan Africa, the Hub finalists are Nigeria and Ghana.
These Hubs will produce prefabricated Blumberg Grain Storage Warehouses, ranging in size from 6,000 square feet for small farmer applications to large cluster configurations of more than 200,000 square feet.
It is estimated that each the manufacturing plant and export Hub will provide 1,000 new jobs through manufacturing steel warehouses and systems.
Furthermore, the hubs will significantly increase exports, provide an agricultural institute to farmers on new farming techniques and methods, and promote agribusiness diversification into upstream and downstream investments.
Blumberg Grain’s development of turnkey storage facilities with management support are designed with the goal to bring post harvest crop losses to under 5% (down from the current estimate of 50%).
Blumberg Grain’s storage facilities are diverse and provide flexible use for grains and dry goods or refrigerated and gas displacement systems for perishables, including produce and meat.
These warehouse units are designed specifically for developing world markets and are powered using an independent energy supply that insures primary or backup operational power. Examples of additional Blumberg Grain technology include self contained inventory management systems and commodities exchange linkages.
Overall, through increased trade activity and development, the five new manufacturing plants and export hubs have the capacity to manufacture 6,000 warehouse buildings annually or US $750M to $1B in output.
Blumberg Grain has over 600 warehouse buildings currently on order from trading firms, agri-businesses, and governments.
Blumberg Grain is truly doing its part in increasing food supply and food inventory levels via sustainable business initiatives.
[quote align=”center” color=”#999999″]Blumberg Grain warehouses and network management enable secure crop-to-market systems providing enhanced and increased supply of food for a country’s people, as well as significantly enhanced and increased quality and quantity of exports.[/quote]
For media and advertising inquired contact Alexander Hitzemann at firstname.lastname@example.org
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