In Africa, we are all waking up to appreciate the value and benefits that the long underrated agricultural sector brings in respect to the survival of general population in wake of the COVID 19 pandemic.
Daily, we are witnessing a growing momentum in the scramble to purchase foodstuff by households vis-à-vis the availability of products produced locally, as many nations have closed both their land and air borders in efforts to contain the spread of the virus. Expectedly, international travel and trade have taken big hits along with the adverse impacts of food imports among others causing unanticipated food supply chain disruptions and shortages in meeting local growing food demands. These events have created a domino effect is forcing many developing countries especially in Africa to take a nationalistic approach towards addressing and ring-fencing food productivity and security for their citizens; hence paving new grounds for the rebirth of Agriculture in the continent.
During and post COVID-19, the Government and private sector will be expected to take bullish positions in the agricultural sector. The objectives being to improve productivity per hectare of crop harvested/livestock bred, strengthen Agribusiness value chains, make them sustainable and viable as a business model in a bid to resolve supply chain disruptions presently being experienced. Technology would also play a central role in this new wave of Agriculture and agribusiness.
As such, innovate companies with foresight such as Cellulant, AFEX, Hills Harvest are becoming key players in defining the narrative of the sector’s evolution for the future. Without having any prior inclination of the current crisis of today, these organizations have already taken bold steps in setting up a digital agribusiness ecosystem as the first phase towards catalyzing the growth and development of sustainable Agribusiness in Nigeria via driving financial inclusion for farmers, connecting these farmers with input supplies and unlocking access to markets—be it households or agro-processors.
A perfect example is the Hills Harvest’s Abu Market; an aggregator in the fresh foods and vegetable value chain with over 10 years of experience of connecting farmers to corporate buyers in a bid to reduce post- harvest losses. This organisation has in recent times seen a hike in demand for its services having recorded success in seamlessly connecting farmer networks and vendors to large retail outlets and homes. This has effectively reduced the impact of the lockdown on citizens as they have direct access to foodstuff courtesy of the arrangement that they have put in place. This strategy of the Abu’s Market has helped converted some motorbike riders into delivery partners (see specimen attached) without additional cost consequently creating jobs that was hampered by the ban on motorbike popularly known as “Okada” in Lagos State. Riders help bring produces from farms to the aggregation hub at Ikosi at a much faster rate. This has also opened a new window of opportunity for motorbike hailing operators to plug into the Agric-logistic to boost food distribution across the country.
Read also: Understanding how to trade agriculture commodities like stocks using ComX
Another prime example is the Cellulant/Agrikore platform that attempts to link the entire food supply chain using block chain technologies connecting farmers directly to consumers on a platform with over 15 million registered partners and over a million active partners. This organization has positioned itself in ensuring adequate supply and survival of agribusiness SMEs in Nigeria. They create markets for budding SMEs into crop/livestock production and linkages of their raw material supplies to large scale producers through its Agrikore market place. b
The connection of critical stakeholders in the Agric value-chain triggers trade between these partners through a demand and supply strategy on the platform acting as a one-stop hub for agribusinesses. Interestingly, the platform is free to join in with an easy step-by-step verification protocol done for all active trading partners. Earlier this year, Cellulant launched its “Connect to Work” feature which serves as a scheme encouraging youths to subscribe and learn how to effectively set up an agribusiness startup on their platform. Part of their value proposition is the provision of support services to their sign-on partners as well as market access to buyers where they can trade their products
AFEX is another business organization with a platform that is targeting farmers and encouraging established and emerging Agropreneurs to access various agro-traders and markets using their ComX platform. They have competencies in trading of commercial grains and promotion of commodity price discovery. This platform encourages entrants to venture into the agribusiness by providing professional information such as availability of agricultural commodities, the sources/location and the price trends. As an Agropreneur, this platform also provides opportunities for input financing services to farmers to grow their farming business in their tradable instruments called “input notes”.
It is no longer news that Government Treasury Bills are becoming less attractive instruments of investment owing to increasing decline in interest rates. Hence, investing in Agriculture or Agribusiness is attracting lots of interests and attention as an alternative; not just to improve food production and supply but to also unlock opportunities for better return on investments compared to money markets. One of such opportunities is provided by AFEX via its ComX platform which allows individuals to invest in a basket of commodities. In this sense one can buy and sell commodity contracts on AFEX commodity exchange before their contract maturity dates under a forward contract arrangement. Also investors and brokers can place up a buy or sell bid to either buy or sell of a particular Agric-commodity at a set price and at a future date. The transparency this platform brings through its online community instils market confidence and transparency allowing investors to see what they’re investing in and know the status of their Investment throughout the duration of their contract. This brings peace of mind to the investor and provides an alternative class of investment for the investor to participate in.
These are some excellent examples in our markets today. Yet, bear in mind that there are many more success stories in Agriculture and agribusiness space that are well positioned and evolving to help SMEs and the local population to cope with food supply and distribution during this pandemic. That said, we are not oblivious of the struggles ahead as financial crisis looms, for that reason a #support4AfricaSMEs campaign has been started by Parminder Vir OBE in collaboration with Uwem Uwemakpan and my good-self to bring resources to budding entrepreneurs’’ and SMEs to survive this crisis; from access to markets, opportunities in agriculture, to available financial interventions by different government and financial institutions across Africa. Knowing where to find support helps remove the cloud of uncertainty over businesses while providing some level of confidence in taking new business risks. Please follow the hashtag to learn and share more so we grow Africa together.
Victoria Madedor
Business Development | Agribusiness Specialist
