Ayodeji Balogun’s life’s work is driven by a singular passion: to bolster food security across the African continent. As a pioneering force in the region’s agricultural development, he co-founded AFEX, a revolutionary agricultural, finance, and technology-based exchange. Since its inception in 2014, AFEX has made a profound impact, supporting over 500,000 smallholder farmers, processing over 500,000 metric tons of grain, and generating a turnover of over $300 million. Currently operational in three African countries, AFEX ambition is to extend its reach to several countries on the continent over the next decade. This strategic expansion is driven by the identification of unique opportunities in the agricultural market and the selection of trade hubs that will facilitate seamless intra-African trade. At its core, AFEX is committed to enabling efficient trade coordination across the continent, ultimately bridging the gap between Africa and the global market. As AFEX continues to drive transformative change in Africa’s agricultural landscape, Ayodeji Balogun’s unwavering dedication to food security and economic empowerment serves as a powerful catalyst for growth, innovation, and prosperity _ with Onome Amawhe.
Can you give us an overview of AFEX?
We started AFEX in 2014 with a resounding vision from our founding investors: to unlock capital for the smallest unit of business in Africa—smallholder farmers. Enmeshed in that vision was a quest to contribute to food security in Africa and to explore the commodity exchange model as a path to efficient and inclusive trade.
As a business, we have recorded a number of wins over the years. We especially hold dear our impact towards producers, and we have reached over 500,000 farmers over our operational locations since we started up. We have also unlocked over $400 million in financing for the agriculture sector on the continent during that period.
Today we are in 3 African countries, with a timeline to hit 10 total countries over a 10-year timeline. Our goal is to be a fundamental engine for intra-Africa trade coordination and make it truly seamless for Africa to trade across borders and ultimately for the rest of the world to trade with Africa.
Read also: Firm partners FG to champion Nigeria’s food security initiative
What is food insecurity?
Food insecurity deals with questions of access and affordability. It’s a complex mix of challenges that make it impossible to get sufficient, safe, and nutritious food to meet dietary needs and live healthy, and it most definitely is a problem that require a complex web of players collaborate to solve.
What makes Africa vulnerable to food insecurity?
We have produced more people than the food we will use to feed them. Our value creation in agriculture has declined because we processed more food in decades past than we do today. This is a multiplier effect that has made the sector almost a poverty center. It is nearly an ill fate to be born by a smallholder farmer on the continent because immediately opportunities are not available for you.
Also, we have taken agriculture as a means of poverty eradication, and the result of that approach to agriculture has been creating fewer poor farmers.
The underlying thing is still that they are poor farmers. We have not created wealthy farmers as a continent over the last 3/4 decades. The last time we made wealthy farmers was in the early eighties, when we started seeing the continent’s entire market infrastructure collapse. Three decades after that, all farmers have remained poor. If you look at our production of food per capita, it has declined significantly.
To what extent do the food production and distribution systems in Africa reflect local needs, culture, and conditions?
We have families who are into their third generation of farming, handing down knowledge from generation to generation, but also increasingly extension support programs are coming in to teach more modern and adaptable techniques. So it really is a mix, just as it should be. The big change that needs to happen across most African societies is the departure from the idea of agriculture as a core subsistence activity. More farmers treating agriculture as a business and plugging in to the networks that support that are vital for us.
How are food systems influencing and being impacted by climate change?
In Nigeria, for example, smallholder farmers are experiencing climate disasters, including increased flooding as well as drought across some states, which is made worse by a lack of access to seasonal climate and weather information services. The implication of this is a significantly lower production volume across the agricultural value chain. Additionally, onethird of the world’s droughts occur in sub-Saharan Africa, with Ethiopia and Kenya currently enduring the worst droughts in at least four decades.
Torrential rains and floods are severely impacting countries such as Chad.
The time to innovate around Africa’s agriculture in the face of a climate crisis is now.
Read also: Insecurity jeopardises food security despite govt’s efforts
What are African policymakers and citizens doing to transform food systems?
Through a range of initiatives, policymakers are implementing reforms to create an enabling environment for agriculture, focusing on sustainable practices and increased investment. A number of initiatives are being spearheaded from every corner, and we will continue to advocate for solutions that are scalable and that ensure that we can increase production, but we also continue to see the potential for increasing intra-Africa trade to plug demand and supply shortfalls across African countries. We were recently part of the founding members of the AfCFTA Association of Commodities Exchanges (A-ACX) after signing an MoU at the Intra-Africa Trade Fair in Cairo to promote intraAfrican trade in commodities, foster collaboration, and collectively address challenges and opportunities in the commodities exchange industry.
How much work is being done to strengthen African food security and improve their resilience to such shocks?
When you are thinking about food security and agriculture, you are essentially thinking about a value chain. So many players have to play their part to ensure that food is available and accessible to everyone.
At the heart of the AFEX model is incentivizing these players to collaborate and work together to achieve our food security goals as a continent. So there is definitely a lot of work being done both in the public and private sectors. Most African governments practice a very active policy environment for the agriculture sector in their countries, and a number of innovative agribusinesses have emerged over the years.
What’s next for AFEX?
At AFEX, our mission is to help Africa feed itself, and this is represented in our strategic goals to drive growth in key areas such as infrastructure, agriculture credit and financing, improved market access for the agriculture value chain, and stronger supply chains by coordinating across farmers, processors, and potentially consumers.
We believe in our ability to continue to unlock capital for the sector and run programs that are both impactful and commercially sustainable. Our commodities exchange model facilitates access to crucial resources such as financing, storage facilities, and other essential services, which ultimately enhance productivity and competitiveness. It is a model that is a core aspect of the food system transformation that Africa requires and that we are happy to deploy alongside other innovative players.
We also remain bullish that the solutions that we have developed are scalable across other African countries, and we will continue to expand across the continent in a way that allows us to enhance intra-Africa trade in key commodities, working alongside governments across Africa and other private sector players.
Join BusinessDay whatsapp Channel, to stay up to date
Open In Whatsapp
