Agriculture – BartonHeyman

Nigeria Update: Disbursements for multi-billion naira projects in agric sector

Barton Heyman — Mon, 05 Nov 2018 13:19:06 +0000

At the dawn of the fall from economic royalty, once enthroned by oil fortunes, Nigeria realised the potential inherent in agriculture and pursued with projects worth billions, in efforts to boost growth through import substitution goals.

Of course, food production is a major challenge all over the world, and with rising population, the demand for food has made it imperative for countries to invest heavily in agriculture.

In Nigeria, access to finance still remains a major challenge, but to increase funding for the sector, the Central Bank of Nigeria (CBN) and Nigerian banks established various agricultural schemes as a way of bridging gap.

Besides the most recent and popular initiative called Anchor Borrowers’ Programme (ABP), there are the Commercial Agriculture Credit Scheme (CACS), Commercial Agriculture Development Programme (CADP), the Interest Draw-Back Scheme and Agricultural Credit Support Scheme.

Nigeria Update: Bank of Agriculture to get N250 billion lifeline

Barton Heyman — Tue, 30 Oct 2018 09:04:28 +0000

The Federal Government yesterday said that it would boost the operations of the Bank of Agriculture (BOA), with N250 billion to enable it to grant credit access to farmers.

Disclosing this in Lagos, yesterday, at a Stakeholders Media Interactive Forum, organised by the Bureau of Public Enterprises (BPE), its Director-General, Dr. Alex Okoh, said the recapitalisation of BOA became imperative, as current capitalisation is negative.

Okoh explained that equity holding in the recapitalised bank will be in the ratio of 40 per cent to the Central Bank of Nigeria (CBN), and Ministry of Finance Incorporated (MOFI); 20 per cent to the private sector, and the remaining 40 per cent to active farmers.

He added that the recapitalisation, which is in line with current restructuring/commercialisation efforts, will also “lead to the emergence of an Agriculture Micro Finance Bank that will provide capital for small scale farmers thereby boosting productivity in the sector,” just as “the process of appointing a Transaction Adviser to superintend the process is nearing completion.”
This comes as the Bureau admitted that it would not be able to meet its share of about N300billion contribution to the N8.612 trillion 2018 National Budget before year end as expected.

Nigeria Update: Notore eyes N100bn valuation from share sale on NSE

Barton Heyman — Mon, 30 Jul 2018 09:49:39 +0000

Nigeria-based fertilizer maker, Notore Chemicals Limited has got regulatory approval to list its shares on Nigerian Stock Exchange (NSE).

The company got approval to list “by introduction” 1.6billion units of its shares on the Nigerian Bourse at N62.50 per unit. This gives the company a potential valuation of N100 billion.

A source at the Securities and Exchange Commission (SEC), who confirmed the development to BusinessDay said the company has registered with the capital market apex regulator for its share listings on the Nigerian Bourse. The source could not disclose the specific date for the share sale although BusinessDay gathered earlier that the listing will be done this third quarter (Q3).

Ahead of the listing, the Board and executive management of Notore will visit the Exchange and capital market stakeholders on Thursday, August 02, 2018 to present a “fact behind the listing” presentation. The presentation is expected to give the management of Notore an opportunity to give investors details about the company’s prospects and plans for the future.

Notore in 2015 signed a strategic gas supply agreement with Eroton Exploration & Production Company, an indigenous oil and gas producer. The agreement is expected to result in enhanced production of fertilizers from the Notore facility, giving the fertilizer, agro-allied, petrochemical and power company a strong competitive edge over other producers.
Due to the availability of gas to the Notore plant, production days per annum has increased. Production was previously constrained because of the number of forced shutdowns the plant had experienced.

Production is expected to increase further to 100 percent of the plant’s installed capacity after the next planned turnaround maintenance, which is due to happen in a few months.

Speaking on the enhanced productivity from the fertilizer plant, the Group Managing Director/CEO of Notore, Onajite Okoloko, said the partnership between his company and Eroton has ended the gas supply shortfalls, which hampered productivity at Notore between 2013 and 2014.
According to Okoloko, significant shortfalls to its facility during the period for approximately 234 days cumulative, owing to incessant militant attacks on oil and gas infrastructure in the Niger Delta, led to a significant drop in output from Notore.

“Our fertilizer plant depends on gas as a major feedstock for production, so when the attacks affected gas supply from oil and gas producers, this had a corresponding impact on our productivity.
“Notore’s plant has the capacity to produce 500,000MT of urea annually and 330,000MT of ammonia per annum, but this was halved between 2013 and 2015 because of gas supply challenges.”

“But with the gas supply agreement entered into with Eroton which has proven gas reserves of 5 trillion standard cubic feet and is just 14 kilometres away from our facility, production has improved significantly,” he said.
The Notore chief executive said with the security in gas supply and significant gas reserves, the company has not experienced gas supply disruptions since Eroton commenced supply to its production facilities in March 2016, adding, “Notore is almost technically backward integrated on its own feedstock, which provides a strong competitive advantage.”

He said Notore also invested in a maintenance programme on the Onne fertilizer plant in the fourth quarter of 2016 to improve the reliability of the plant, adding that plans were in place for another scheduled maintenance in the first quarter of 2019, in order to optimize production from the fertilizer plant.
Okoloko, however, noted that fertilizer usage in Nigeria remained low, putting consumption at between 10 and 15kg per hectare, in contrast to the Food and Agriculture Organisation’s recommended 200kg/ha.

“But we continue to educate and train subsistence and commercial farmers, as well as give them access to fertilizer through our distribution chain at appropriate pack sizes and affordable prices.
“We have a very effective distribution network that makes sure our fertilizers gets to the farmers. With over 350 trucks, 80 plus distribution partners and more than 3,000 retail outlets, we are able to reach millions of farmers in several local governments and states in the country,” he said.

Notore Chemical Industries Plc (Notore) is one of the leading fertilizer, agro-allied, and power companies in Africa and is committed to helping Nigeria and the African continent become self-reliant in food production and economic wealth. Under the leadership of Group Managing Director/CEO, Onajite Okoloko, after acquiring the assets of the former National Fertilizer Company of Nigeria (NAFCON) through the federal government’s privatisation programme, Notore has since grown into an agricultural firm, targeting local markets as well as exports.

The company’s principal activities include the supply of premium fertilizers, appropriate education on best practices for farming, and proper deployment of these practices for optimum results. The company has built a robust network of professionals that support farmers and farming communities across Nigeria.

After Notore acquired the assets of the moribund NAFCON in 2005, the company raised more funds from a syndicate of Nigerian banks and commenced extensive rehabilitation of the plant in 2007. In early 2010, it started commercial production and distribution of fertilizer across the country.

Notore listing on the Nigerian Bourse will enliven primary markets activities which have remained calm this year having failed to continue the pace of recovery seen in 2017. Though, the 2017 primary markets activities were dominated mostly by supplementary offers, listings by introduction, debt issuances, mergers and divestments.
Many businesses have shown interest in listing shares on the Exchange due to improving macroeconomic fundamentals. The market patiently awaits Telecoms giant, MTN which has indicated it will list its Nigerian unit and raise funds through an Initial Public Offering (IPO) this year.

SAHCOL, Nigerian Reinsurance Corporation and Indorama Eleme Petrochemicals are among companies following the footsteps of the MTN Group. They are expected to in the second half (H2) of the year.

“A resurgent public offering would help deepen equity market, provide more investment options and trigger greater investor participation in the long-run,” according to research analysts at Lagos-based Vetiva Capital Management Limited. Notore listing by introduction implies the company’s shares were bought without a prior Initial Public Offering (IPO).

It means that the company would usually have raised capital prior to applying to list by introduction, and also must meet the listing requirements – including a minimum number of public shareholders – 300 to list on the Main Board; 51 to list on the Alternative Securities Market (ASeM) and minimum public float (20percent for the Main Board; 15percent for ASeM.

Notore operations are divided into three units: fertilizer, power, and seeds. Early this year, (January), Notore obtained a Free Trade Zone (FZE) license. The FZE located in Eleme, Rivers State is expected to kick off operations in the next two years.

Notore listing on the NSE will avail legacy investors the opportunity to exit if they wish. Notore was founded in 2005 by a group of investors led by Onajiite Okoloko. Other members of the consortium include private equity firm Emerging Market Partners and Orascom of Egypt.

The company bought over assets of the defunct National Fertilizer Company (NAFCON), One.

Nigeria Update: First Bank restates commitment to agro-businesses financing (Nigeria)

Barton Heyman — Mon, 16 Jul 2018 11:32:55 +0000

The Managing Director First Bank of Nigeria Limited and Subsidiaries, Dr. Adesola Adeduntan, has expressed the commitment of the bank to continue in financing agricultural businesses and enabling farmers.

Adeduntan who disclosed this yesterday in Lagos at the First Bank Agric Expo 2018 with theme: ‘Innovating for a Sustainable Green Economy’ noted that the event was indicative of their commitment to increasingly collaborate with public and private sector partners to fully restore the prime role of the agricultural sector as the mainstay of the national economy.

He also stated that following their priority as a continuous financier of credit worthy agro-allied businesses, their team of dedicated agricultural professionals specialising in various fields of agriculture are strategically located to identify and support agricultural enterprises.

He added that the dedicated agricultural professionals cut across all regions of the country, with a suite of customised sector and customer friendly agricultural financing solutions.

Adeduntan maintained that the bank had a large base of existing small, medium and commercial agribusiness clients across the country operating in all segments of the agricultural value chain covering primary production, storage, processing, packaging and agro export, and others.

The First Bank MD further stated that in partnership with public sector institutions, the bank had supported several State Governments on Agricultural Development Trust Fund Scheme (ADTF), which he noted that it was an initiative designed to provide credit facilities to small scale farmers who do not have collateral.

According to him, “Under the federal government’s Commercial Agriculture Credit Scheme for long tenured credit facilities to commercial agricultural enterprises – at single digit interest rate – First Bank has supported over 23% of all the enterprises supported by all the banks put together. The projects spread across input supplies, primary production, processing and marketing. Obligors include small, medium and large scale enterprise in the agricultural value chain.

“Honourable Ministers, you may recall that the Anchor Borrower Programme was an innovative product developed by First Bank, as it was then known as ‘Industrial End Users Out-grower Scheme’, which is now improved for enhanced delivery. With these experiences, First Bank worked immensely to support the Central Bank of Nigeria (CBN) in actualising the efforts of reviving all the value–chains as envisioned by the federal government of Nigeria.

“In addition, following the policy for playing down on importation of some of the commodities and encouragement of exportation of agricultural commodities, First Bank is at the forefront of adopting the supportive schemes newly introduced by the CBN, such as the Non-Oil Export Stimulation Facilities (NESF).”

Nigeria Update: Tincan Port records increased exports for farm produce

Barton Heyman — Wed, 09 May 2018 13:24:49 +0000

The diversification agenda of the Federal Government may be yielding results as export of agricultural produce through the TinCan Island port in Lagos, is on a sharp increase.

The Nigeria Customs Service (NCS), TinCan Island Command, confirmed yesterday that the exports have gained appreciable improvement of about 558.46 per cent in terms of volume and 402.24 per cent in terms of FOB (Free on Board) value between January and March this year compared to the same period last year.

Controller of the Command, Abdullahi Baba Musa, while updating journalists on the performance report for the period, said the Command recorded about 45,462 metric tonnes of export with FOB value of N29.146billion. This is against the 8,140.6 metric tonnes with FOB value of N7.246billion achieved in the corresponding period of 2017.

He gave the breakdown of the exports as 38,517 metric tonnes of agricultural produce export with FOB value of N22.435billion; and about 6,945 metric tonnes of processed and manufactured goods with FOB value of N6.711billion during the review period.

On the revenue performance, Musa said the Command raked in about N104.5billion as against a projection collection of the sum of N116 billion, recording a performance rate of 90.09 per cent between January and April this year.

“A comparative analysis against collection of the previous year (2017) for the same period in the sum of N82.154billion showed there is an improvement in the figure of about N22.68billion, which is equivalent to an improvement of about 27.61 per cent.

“The improved collection so far has been driven by the establishment of standard operating procedure (SOP) and strong revenue drive achieved through blocking of Areas of revenue leakages,” he stated.

Musa said the TinCan Island Command is committed to the transformation of revenue collection and reporting system with the implementation of MOS II with additional functionality, which is an upgrade of the Nigeria Customs Integrated System (NICIS I).

As part of these, he said the Command is working hard to float a “one stop shop” which will enable treatment of declarations with valuations, classification and other related clearance issues/queries.

“In the meantime the renovation of the space for the one stop shop is in progress. Automation of the Cargo examination and assignment process where examination officers are assigned examination automatically is also in the pipeline to ensure transparency in the inspection process.

“The vehicle Valuation System is being further improved with the attachment of the Valuation Note issued to the SGD in the system, this will enable a quick verification of assessment and duty payment,” he explained.

He added that the command has made several seizures, which included: 1×40 and 1×20 containers of Tramadol Hydrochloride (225mg) which were declared as electrical static converters and ciprofloxacin.

Other seizures are: 3×40 containers of e-waste which are considered toxic to the environment/health; and 5×40 containers of second hand clothing consisting of about 1,239 bales of clothing prohibited under the absolute import prohibition list; 4. 1×40 containers of used tyres as contain in Import Prohibition List for trade.

All the seized items, according to him, have a total duty paid value (DPV) of N124million.

Musa added that efforts have been intensified under the Federal Government’s Presidential Initiative on ease of doing business, to improve on performance rating.

Nigeria Update: Investors to stake fresh N250bn in Nigeria rice production

Barton Heyman — Fri, 13 Apr 2018 09:18:58 +0000

Following plans to establish additional 14 rice mills in the country, investors have committed additional N250billion into Nigeria’s rice production. This is in addition to the current N300billion invested by processors

The Minister of Agriculture Audi Ogbeh, who disclosed this during a Rice Conference organised by Agro Nigeria in Abuja, said the country would save $300million from import substitution through local processing.

He disclosed that there are presently 21 large integrated rice mills with a total processing capacity of 1.22 million metric tonnes yearly spreading across the country, including Kano, Enugu, Ebonyi, Kebbi, Anambra, Edo, Nasarawa, Benue, Kwara, Jigawa, Niger, and Kogi states.

He said: “Today, many integrated local mills have their milled rice in the Nigerian market, and consumer demand and preference for local rice has risen due to better quality and taste compared to imported rice. Home-grown international grade rice can be found across Nigerian markets, and a total of 14 mills will soon come on board.”

Ogbeh noted that members of the Rice Producers Association of Nigeria (RIFAN), currently have a direct workforce of 5,000 skilled Nigerians including women as off-takers of rice paddy, and have created jobs for over five million rice farmers out of the existing 11 million rice farmers in Nigeria.

He said the integrated rice mills have also employed about two million unskilled workers, while Nigeria’s rice import bill has dropped appreciably by over 90 per cent.

The minister observed that in the past three years, paddy production had seen exponential growth, reaching 6.9 million MT in 2016, or 4.14 million MT of milled rice, and 8.019 million MT, or 4.81 million MT of milled rice in 2017.

According to him, Nigeria is moving towards self sufficiency in rice production, and is on track to achieving this by the year 2020.
He recalled that in 2009, Nigeria could boast of only one integrated rice mill, and by 2017, the country had over 17 integrated rice processing mills with a milling capacity of 600,000MT a year.

“Presently, we have 21 large scale mills with a capacity of 1.2 million MT, while additional mills are springing up,” Ogbeh told participants at the inaugural Agro Nigeria rice event.

He said: “Estimated crop area of rice in 2017 was 3.9 million hectares, which represent an increase of about 6.9 per cent over the 3.17 million hectares cultivated in 2016. All the states of the federation recorded an increase in rice production, with Kebbi and Lagos having the highest increase. Over the last three years, we’ve recorded increase in production from an average of 2.5 tonnes to five tonnes per hectare.”

The minister said based on per capita consumption, Nigeria’s demand for rice stands at 9.5 million MT of paddy, representing 6.8 million MT of milled rice, adding that the deficit, which used to stand at between three to four million MT had been reduced to 1.99 million MT.

To sustain the momentum of the present growth, Ogbeh said: “Government would continue to provide conducive environment to rice farmers and millers in the area of ensuring adequate agro-chemicals, fertilisers, land development and irrigation facilities, mechanisation, modern extension services, power supply, access to good roads, farmlands and favourable pricing. Essentially, forestalling the illegal activities of smugglers across Nigeria’s borders remain a priority.”

The Governor of Kebbi State, who doubles as Chairman, Presidential Initiative on Rice, Abubakar Bagudu, said operators in the rice value chain “must appreciate the fact that the cost of production in countries we are competing with is cheaper than the production cost for the same commodity in Nigeria. This needs to be addressed in order to ensure sustainability.”

Nigeria update: Bankers Committee disburses of N26 billion AGSMEIS funds

Barton Heyman — Fri, 13 Apr 2018 09:17:45 +0000

No fewer than 300 farmers and micro, small and medium enterprises entrepreneurs would benefit from the Bankers Committee’s N26 billion Agribusiness, Small and Medium Enterprises Investment Scheme (AGSMEIS) fund.

The fund was pooled from five per cent of profit after tax (PAT) contribution of all deposit money banks in the country to support agriculture and the real sector in the country.

At the launch of the fund’s disbursement yesterday by the Governor of the Central Bank of Nigeria (CBN), Godwin Emefiele in Abuja at the end of the Bankers’ Committee Meeting, a total of N115 million was disbursed to the first beneficiaries.

The fund is to assist the beneficiaries acquire tools required for start up operations such as tractors and other machineries for the different vocational skills.

Emefiele said at the 2016 Bankers’ Committee Retreat that the concerns of bank chiefs about the risks of unemployment, gave rise to the design and fund for a suitable scheme that would reduce the huge financing gap for Micro Small and Medium Enterprises (MSMEs).

He said it would also enhance jobs creation, financial inclusion and inclusive growth for Nigerians, particularly the youths.

Nigeria Update: ‘Agriculture living up to our expectation as job creator’

Barton Heyman — Wed, 14 Mar 2018 10:20:08 +0000

President Muhammadu Buhari has expressed satisfaction with the growing role of agriculture as a strategy for jobs creation among young Nigerians. Speaking while receiving Boukekri Rmilli, the Foreign Minister of Tunisia at the State House in Abuja on Tuesday, President Buhari said his administration will increase its support for agriculture as a mechanism for jobs creation.

“We are trying very hard to provide jobs, for our youths. We are investing heavily in agriculture. “Following the uncertainty in the oil market and the huge unemployment situation in the country, we chose to put our fate in agriculture. I am glad that our young people are accepting agriculture instead of waiting for white-collar jobs.

“They are out there sweating it out in the sun, making a living. Agriculture is the way to go, even when we are realising this almost belatedly,” the President said in a statement signed by his Senior Special Assistant on Media and Publicity, Garba Shehu.

He said that the administration recognises the progress Tunisia has made in agriculture, tourism and medical health, and will in a no distant time, raise a team to visit that country to identify sectors in which the two countries can work together.

In this regard, he expressed happiness with the resuscitation of the Nigeria – Tunisia Binational Commission which was attended by a large delegation of businessmen and prospective investors.Earlier, Rmilli, who is also the leader of the delegation of businessmen, informed the President that his country is anxious to grow trade relationships with Nigeria. He expressed satisfaction with the large number of local business men who turned up for the Nigeria – Tunisia Business Forum on Monday in Abuja.

Nigeria Update: Government may adopt digital tech to reach small-scale farmers

Barton Heyman — Fri, 09 Feb 2018 09:46:56 +0000

To address numerous challenges bedeviling small scale farming in the country, the Federal Government may adopt phygital technology to reach farmers across the country.

The Permanent Secretary, Ministry of Agriculture and Rural Development Bukar Hassan, while speaking during the presentation of the phygital smallholder value chains technology in Abuja harped on the need to provide extension services for small scale farmers.

He said: “If we want the small scale farmers find its right foot place in Agriculture, we must do exactly what we are saying here; we must provide the Farmer extension services, the knowledge he will need to evolve his farming skills from subsistence to commercial farming, and I believe this technology would help us solve so many problems”.

The Director General, Manobi Daniel Annerose said the project to be implemented in collaboration with the International Crop Research Institute for the Semi Arid Tropic (ICRISAT), said the aim of the project is to reach 100,000 farmers before the end of 2018, and reach 50million farmers across Africa by 2020. The the project would monitor the production process to harvesting, transportation till it get to the final consumer.

Disclosing that the project has kicked of with an initial investment of $800,000, he said that the overall plan is to invest $50million within the next two years to enroll one million farmers and prepare the recruitment of 50million farmers in the next five years. He added that project would also ease financial lending to farmers as commercial banks would be provided

The Director, Research and Development Digital Agriculture Manobi, Pierre Sibery Traore, explained that the initiative is divided into two phases of agcelerant and phygital technology. He added that the agcelerant is the value chain orchestration platform that helps link smallholders farmers to financial services, insurance, offtakers that is agro industries, agro advisors and giving them technical support on how to meet their production target.

He said the essence of the project is to ensure the safe inclusion of the small scale farmers to the World Food Market stressing that because of the size of Nigeria economy the country would be a major supplier of food to the world in the coming decade and there is the need to set in motion the phygital infrastructure to make it happen.

Traore further explained that the organization is also launch the Nurturing Africa Digital revolution for Agriculture (NADIRA), explaining that the purpose was to embed in phygital agriculture the use of advance satellite technology.

He said they are working with the European Space Agency who have develop a system that has some satellite updating the earth and providing free data for up to 10meters for every five days all over the world.

He said the data would help monitor crop response in smallholder field in aerial time and embed the data stream into mobile telephoning and otherphygital infrastructure.

Africa Update: Agriculture will be Africa’s quite revolution, says report

Barton Heyman — Tue, 16 Jan 2018 12:25:08 +0000

With a focus on SMEs and smallholder farmers creating the high productivity jobs and sustainable economic growth that failed to materialise from mineral deposits and increased urbanisation, latest Africa Agriculture Status Report (AASR), has indicated that agriculture will be Africa’s quiet revolution.

According to the report commissioned by Alliance for a Green Revolution in Africa (AGRA), smart investments in the food system can aid the revolution if planned correctly.

Despite 37 percent of the population now living in urban centres, the report showed that most jobs have been created in lower paid, less productive services rather than in industry, with this service sector accounting for more than half of the continent’s GDP.

Commenting on the report findings, President of the Alliance for a Green Revolution in Africa (AGRA) Dr. Agnes Kalibata said: “Africa has the latent natural resources, skills, human and land capacity to tip the balance of payments and move from importer to exporter by eating food made in Africa. This report shows us that agriculture involving an inclusive transformation that goes beyond the farm to agri-businesses will be Africa’s surest and fastest path to that new level of prosperity.”

To succeed, she explained that Africa’s agricultural revolution needs to be very different to those seen in the rest of world. It requires an inclusive approach that links millions of small farms to agribusinesses, creating extended food supply chains and employment opportunities for millions including those that will transition from farming.

This is in contrast to the model often seen elsewhere in the world of moving to large scale commercial farming and food processing, which employs relatively few people and requires high levels of capital.

The report highlights the opportunity for Africa to feed the continent with food made in Africa that meets the growing demand of affluent, fast growing urban populations on the continent looking for high value processed and pre-cooked foods.

Furthermore, it advocates that this opportunity should be met by many of the continent’s existing smallholder farmers. Currently part of this growing demand for Africa’s food is met by imports. These amount to $35bn yearly and are expected to cost $110bn by 2025 unless Africa improves the productivity and global competiveness of its agribusiness and agriculture sectors.

The report acknowledges that the private sector holds the key to the transformation of the food system so far.

“Impressive value addition and employment is being created by SMEs along value chains in the form of increased agricultural trade, farm servicing, agro processing, urban retailing and food services. Large agribusinesses like seed companies, agro processors and supermarkets are also playing an increasing role in the food value chain in many regions,” said Peter Hazell (IFPRI), the technical director of the report.

However, the study is clear that left to the private sector alone, growth in the agrifood system will not be as fast as it could, nor will it benefit as many smallholder farmers and SMEs as it could.

Government support is needed to both stimulate and guide the transition. As a high priority, governments need to create an enabling business environment and in particular, meet targets to invest ten percent of GDP in agriculture, agreed at the 2003 African Union (AU) Summit as part of The Comprehensive Africa Agriculture Development Programme (CAADP).