Nestlé invests in Cuba to benefit the local food industry
Agri-Business I Diary I Confectionery I Meat & Poultry I Food processing
Frutarom to acquire Enzymotec for US$ 210 mn
Cargill to invest US$ 240 mn in India over the next
Alibaba Group, Auchan Retail and Ruentex Form New Retail Strategic Alliance
Unilever to acquire TAZO brand from Starbucks
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Alibaba Group Holding Limited, Auchan Retail S.A., and Ruentex Group, announced a strategic alliance that brings together their online and offline expertise to explore new retail opportunities in China’s food retail sector.
As part of this strategic alliance, Alibaba Group will invest a total of HK$22.4 billion (approximately US$2.88 billion) to obtain an aggregate direct and indirect stake of 36.16% in Sun Art Retail Group Limited (HK stock code: 6808, “Sun Art”) by acquiring shares from Ruentex. Auchan Retail is also increasing its stake in Sun Art. The transaction will give Auchan Retail, Alibaba Group and Ruentex approximately a 36.18%, 36.16%, and 4.67% economic interest in Sun Art, respectively. Auchan Retail will continue to consolidate Sun Art in its financials following the transaction.
Sun Art is a leading multi-format offline food retailer in China. As of June 30, 2017, Sun Art operated with a total gross floor area of approximately 12 million square meters in China. Sun Art currently operates 446 hypermarkets as large as 17,000 square meters in 29 provinces, autonomous regions and municipalities across China under the “RT-Mart” (大润发) and “Auchan” (欧尚) banners. It also operates superstores and innovative unmanned stores under the “Auchan Minute” brand.
The alliance reflects Alibaba’s “New Retail” vision to leverage its internet-based approach and new technology, while working closely with retailer partners to provide a seamless online and offline experience to consumers in China. It also aligns with Auchan Retail’s Vision 2025 “Auchan changes lives”. Building on the strengths of the three partners, the alliance aims to introduce a new shopping experience to China’s 1.3 billion consumers.
“Alibaba is excited to join with our new partners to redefine traditional retail through digital transformation,” said Daniel Zhang, Chief Executive Officer of Alibaba Group. “Physical stores serve an indispensable role during the consumer journey, and should be enhanced through data-driven technology and personalized services in the digital economy. By fully integrating online and physical channels together with our partners, we look forward to delivering an original and delightful shopping experience to Chinese consumers.”
Nestlé and Cuban food enterprise Corporación Alimentaria, S.A. have started the construction of a food production plant in the Mariel Special Development Zone (ZEDM). Nestlé will invest CHF 54 million in the factory, which will employ 260 people by 2020.
The plant will produce the world’s leading coffee brand Nescafé, the local Cuban roast & ground coffee Serrano, Nestlé Fitness cereal based snacks, the Nesquik powdered beverage, as well as Maggi cooking aids.
Yearly production capacity is expected to be over 18,500 tons in total, for local consumption and export. The factory will be located in a 602,779 sq ft area, where manufacturing structures will occupy 139,930 sq ft distributed in two floors. Construction is expected to be completed by the end of 2019, and operations will start in the first trimester of 2020.
Laurent Freixe, CEO for the Americas at Nestlé, made a three-day visit to Cuba to mark the start of construction. He said: “This new factory will help meet growing consumer demand and further strengthen our presence in Cuba. Local production capacity combined with Nestlé’s know-how will benefit the local food industry and create new chances for growth.”
The inauguration ceremony was attended by Cuban authorities including Mrs. María Carmen de la Concepción González, Minister of Food Industry; Mrs. Ana Teresa Igarza Martínez, General Director of ZEDM and Mr. Nelson Arias Moreno, President of Coralsa; among others. The ZEDM is an important center for economic development and a major platform for foreign investment in Cuba.
Harold Hoffmann, Country Manager for Cuba, said: “This production plant represents a great opportunity to develop new categories with high demand in Cuban market. We seek to offer products with nutritional value, in coherence with our Nutrition, Health and Wellness strategy, while expanding the business in the region”.
While in Cuba, the Nestlé delegation also visited the Los Portales plant, at Pinar del Rio, where carbonated soft drinks and bottled water are produced. They also visited the Palacio de los Pioneros Ernesto Guevara in La Havana, where Nestlé will sponsor a permanent Education pavilion on Healthy Food Habits, targeted at school-age children.
JD.com, China's largest retailer, participated in a signing ceremony held at the Great Hall of the People, with the company entering agreements to purchase in excess of $1.2 billion of beef from The Montana Stock Growers Association (MSGA) and pork from Smithfield Foods, Inc. over the next three years. The agreements are part of an overall commitment by JD to purchase $2 billion of U.S. goods across a wide range of categories over three years. U.S. Secretary of Commerce Wilbur Ross, Jr. and Chinese Vice Premier Wang Yang were in attendance to witness the signing ceremony.
Meat products are a fast-growing category for JD. In the first half of 2017, volume from direct sales of meat on JD increased more than 780 percent year-over-year, with imported meat accounting for more than 30 percent of those sales. Online orders for fresh and frozen meat come chiefly from first and second-tier cities, leaving huge potential for growth in online sales from the rest of the country.
“These groundbreaking agreements bring together two of America’s most trusted and in-demand meat suppliers with China’s leading e-commerce platform, to the benefit of both U.S. producers and Chinese consumers,” said Richard Liu, JD.com Chairman and CEO, who participated in the signing ceremony.
“China’s shoppers will rest assured knowing that they are able to purchase safe, high-quality meat products imported from the U.S., with the fast delivery and ironclad assurance of authenticity that they have come to expect from JD. We look forward to expanding our long-term cooperation with high-quality U.S. meat producers like Smithfield and MSGA.”
JD will import Montana-sourced beef from Cross Four Ranch and MSGA members to China for direct sale to the 258 million Chinese consumers on its e-commerce platform. The procurement agreement is for an initial three years, with a minimum commitment of $200 million in beef to be imported by JD from Cross Four Ranch and MSGA members at fair market value during the term. It is estimated that JD’s purchase of Cross Four Ranch and MSGA beef will increase Montana beef export sales by as much as 40% in 2018.
JD.com commits to purchasing more than
$2 Billion of U.S. goods over next three years
Cargill,a leading food and agriculture company, announced that it is investing US$240m in India over the next 5 years. These new investments will add to the food safety and economic development of the country and benefit the food processing and agriculture industries.
The announcement was made at the World Food India Conference by Peter Van Deursen, Chief Executive Officer, Cargill Asia Pacific at a signing ceremony of a Memorandum of Understanding (MOU) with India Ministry of Food Processing Industries in the presence of Honorable Union Minister of Food Processing Industries, Smt. Harsimrat Kaur Badal.
The added investment will be in Cargill’s core businesses including, edible oil, cocoa and chocolates, starches and sweeteners and animal nutrition in India. In addition, it will provide employment to 1,300 people and help farmers in the country.
Van Deursen, said, “India is an important market for us and this increased investment demonstrates our commitment to the country and the development of its agriculture and food processing industry. With the growing population and changing consumer trends, Cargill is committed to nourishing the people of India in a safe, sustainable and responsible manner. The Ministry for Food Processing Industries is to be complimented for organizing an event the scale of World Food India as it lets us collaborate with partners in the public and private sectors to deliver to our customers what consumers want.”
Cargill to invest US$240m in India over the next 5 years
Orkla has signed an agreement to purchase Agrimex, a frozen vegetable producer in the Czech Republic
Through its wholly-owned subsidiary Hamé, Orkla has signed an agreement to purchase Agrimex, a leading frozen vegetable producer in the Czech Republic.
Hamé is a leading branded food company in the Czech Republic and Slovakia, and holds strong positions in the liver paté, ready meals, ketchup, jam, baby food and tinned vegetable categories. Through the acquisition of Agrimex Hamé has strengthened its position in the frozen vegetable category.
“Agrimex and Hamé are a good fit. We are market leader in several categories in the Czech Republic and Slovakia, and by purchasing Agrimex we will also acquire a solid foothold in frozen vegetables. Furthermore, we are strengthening our position in the out-of-home sector since more than one fourth of Agrimex’s sales are made through this channel,” says Atle Vidar Nagel Johansen, Orkla EVP and CEO of Orkla Foods.
Agrimex has a modern, automated production plant in Panenské Břežany, north of Prague. Raw materials are supplied by local Czech farmers in the factory’s vicinity. The products are sold under the Dione, Dione Premium and Agrimex Foodservice brands.
Agrimex is a privately owned company established in 1995 and has 32 employees. The company had a turnover of CZK 260 million (approx. NOK 96 million) in 2016. The company will be consolidated into Orkla’s financial statements as from 1 December 2017.
Maple Leaf Foods, announced that it has reached a definitive agreement to acquire Field Roast Grain Meat Co. (“Field Roast”) for USD$120 million, plus related costs. The Company expects to finance the transaction through a combination of cash-on-hand and drawings under the existing credit facility. Field Roast is a leading brand of premium grain-based ‘meat’ and vegan cheese products, with sales of approximately USD$38 million. Subject to customary regulatory review and transaction conditions, the transaction is expected to close by the end of 2017 and be accretive to earnings.
“The acquisition of Field Roast complements and expands our portfolio in the fast-growing North American market for alternative proteins,” said Michael McCain, President and CEO. “It also aligns with our vision to be a leader in sustainable protein and create shared value through making a positive social impact. Field Roast has built brand leadership through focusing on quality, craftsmanship and taste, and its acquisition will allow Maple Leaf to fuel growth in the category through investment, brand building and innovation.”
Maple Leaf Foods agreement to acquire Field Roast Grain Meat Co.
Danone Manifesto Ventures announced that it has taken a minority stake in the Hawaii-based company Kona Deep. Kona Deep is creating a new category of premium water with its unique deep ocean water, sourced 3,000 feet below ocean surface in Kona, Hawaii, from a pure source containing natural minerals. Aligned with Danone’s One Planet. One Health strategic vision, Kona Deep shares Danone’s sustainable business agenda and vision of bringing consumers great tasting water with compelling hydration benefits.
After launching in Hawaii in late 2015, Kona Deep has recently expanded onto the U.S. mainland where the demand for premium waters and performance waters is growing rapidly. Hawaiian deep ocean water offers consumers both the purity of a trusted natural source and the benefits of naturally occurring deep ocean electrolytes. Kona Deep is sold primarily in leading grocery and natural food stores.
Danone Manifesto Ventures participated in Kona Deep’s $5.5 million financing round alongside Grand Crossing Capital and local Hawaiian investors.
Kona Deep intends to use the investment to support growth initiatives by expanding distribution, increasing and optimizing production capacity and raising awareness for the Kona Deep ocean water. Kona Deep’s management team, led by CEO Patrick Turpin, will leverage Danone Manifesto Ventures’ resources and expertise, to capitalize on the opportunities ahead.
Danone Manifesto Ventures invests in Kona DeepTM
Danish Crown buys into South African foodservice sector
ESS-FOOD has acquired a majority stake in the South African foodservice business Overberg Food Distributors in Cape Town
ESS-FOOD, which has to date been a pure trading company, is now pursuing a new direction and establishing itself in the foodservice sector in South Africa.
- For several years we have enjoyed stable sales to South Africa. This prompted us to look at the possibility of entering the market for the sale and distribution of meat, which we now have acted on by acquiring a 70 per cent stake in Overberg Food Distributors, explains Morten Holm, CEO of ESS-FOOD.
In the long term, the plan is for Overberg Food Distributors to expand its activities to cover the whole of South Africa. At the same time, the company will act as the Danish Crown group's bridgehead on the continent, where the countries in West Africa are deemed to hold particular potential.
- It's important for Danish Crown as a group to create a strong foundation for future business on the African continent. In doing so, we’ll be able to benefit from the economic growth which is expected in Africa in the coming decades, says Jais Valeur, Group CEO of Danish Crown.
Overberg Food Distributors has 250 employees, and serves approx. 2,000 customers, largely in the southern part of South Africa, from cold stores in Cape Town and Port Elizabeth. The company was founded 25 years ago, and today has revenue of approx. DKK 350m a year.
Overberg Food Distributors is highly respected by its customers for its expertise, professionalism and focus on quality. This is fully in line with ESS-FOOD's values, and so the plan is that we provide competences in areas such as procurement and financial management, says Morten Holm.
In 2015/16, the Danish Crown group posted revenue of approx. DKK 600m in Africa, which included sales by ESS-FOOD of 25,000 tonnes of meat at a value of DKK 150m on the South African market.
Moving forward, ESS-FOOD will be responsible for selling all the Danish Crown group's products in Africa. In other words, everything from Danish bacon and German Schweinshaxe, to Polish sausages and canned products from Tulip.
EIB and BBVA to provide EUR 300m to finance innovation and digitisation in Spanish SMEs
The European Investment Bank (EIB) and BBVA have joined forces to provide Spanish SMEs with the funding they need to implement their digitisation and innovation strategies. ElB Vice-President Román Escolano and Head of BBVA Spain Cristina de Parias signed an agreement today in Madrid through which the EIB will provide BBVA with EUR 150m to finance SME investment projects related to innovation and digitisation. BBVA will provide an additional EUR 150m of its own resources to fund this new credit line.
This is the first EIB operation in Spain that is entirely dedicated to promoting and financing innovation and digitisation in SMEs, including funding for initiatives that enable them to digitise their operations. By implementing the latest technologies, companies that access this funding will be able to optimise and modernise their processes and equipment, improving data management, their web portals or business marketing, for example. These investments will enable them to ensure their competitiveness, thereby helping to generate wealth and create jobs.
The agreement signed today makes BBVA the first bank in Spain to collaborate with the EIB on this new credit line. It will enable the financing of up to 100% of projects with costs no greater than EUR 12.5m for small businesses and EUR 25m for midcaps (up to 3000 employees). The companies that access this credit line will have the opportunity to benefit from the EIB’s favourable conditions, both in terms of maturity and interest rates.
At the signing ceremony today in Madrid attended by both institutions, the EIB Vice-President pointed to “the EIB’s important work in helping to boost the Spanish economy by joining forces with the banks. This agreement is a clear demonstration of our priorities in Spain: to provide the necessary funding to ensure SMEs’ growth and competitiveness by supporting their investments in innovation and digitisation.”
Nestlé USA welcomes Chameleon Cold-Brew to its Growing Coffee Portfolio
Nestlé USA continues to diversify its coffee portfolio with the acquisition of Chameleon Cold-Brew, a leading provider of premium crafted coffee sourced consciously and grown sustainably. Founded in 2010, Austin-based Chameleon has become the number one organic cold brew brand in the US, and one of the top three refrigerated cold brew brands in the US. Its current portfolio consists of multi-serve concentrates and single-serve RTD products, two segments that account for 18 percent of the $2.5 billion in-home coffee category.
“Chameleon has been extremely fortunate to grow from our hometown base of cold-brew lovers in Austin to a national brand in just a few short years,” said Chris Campbell, co-founder and CEO. “Partnering with a world-class company like Nestlé will give us the opportunity to do so on a bigger platform. Our shared values around product integrity and commitment to sustainability made Nestlé the best choice to enable Chameleon Cold-Brew to accomplish our goals for the future.”
Chameleon’s products are available in a wide variety of formats: ready-to-drink cold-brew, cold-brew concentrate, kegs, cold brew kits and whole bean coffee. Retailers carrying these products include Whole Foods, Target, Safeway, Albertson’s and Bed, Bath and Beyond -- among many others.
“We believe the Chameleon brand is perfectly positioned to support Nestlé’s strategy for coffee, which is to have a variety of offerings in terms of format, taste and price points,” said Paul Grimwood, Chairman and CEO of Nestlé USA. “We believe this relationship will benefit both of us as we expand our access to the emerging cold brew category while helping Chameleon grow so that more people can enjoy its delicious, premium crafted coffee.”
The Board of Directors of the African Development Bank Group (AfDB) has approved the institution’s intervention strategy in Eritrea for 2017-2019.
The Interim Country Strategy Paper (I-CSP) supports the Government’s National Development Plan (2014-2018) for the country’s economic and social development through agricultural transformation.
Focusing on transforming the agricultural sector as the pathway to promoting inclusive and sustainable economic growth, the I-CSP provides for investments to improve access to inputs and agricultural technology. It will also put in place enablers for job creation, skills development and entrepreneurship in agriculture, particularly for the youth and regions (zobas and sub-zobas) that are considered to be below national service delivery indicators.
Interventions in the agricultural sector will aim at transforming the sector to unlock its full inclusive and sustainable growth and development potential by enhancing production, productivity, value-addition, and marketing fruits and vegetables, horticulture, and dairy products within the region. They will also promote greater inclusivity by increasing incomes and employment, with a focus on underserved women, youths and regions.
Secondly, technical assistance, advisory services, and advocacy informed by appropriate knowledge works, will be provided to build public sector institutional and human capacities to enhance the Government’s delivery of basic social services.
Eritrea: AfDB supports inclusive growth through agriculture and infrastructure development
Fonterra Co-operative Group from New Zealand has extended a long-term commercial agreement with Lithuania's largest dairy producer, AB Rokiskio Suris, through a 10 percent stake in the company's shares.
Fonterra, through Rabobank's turnover in 2017 classified as sixth dairy company worldwide, has invested € 7.1 million in Rokiskio. By doing so, they have secured a supply line of high quality whey products, while at the same time making product options for all of Europe and the Middle East. This also offers opportunities for sources of further dairy products in the Baltic milk segment in order to meet the growing demand from the nearby markets.
President John Wilson of Fonterra said that the investment closely matches Fonterra's strategy to expand the global sources of milk in strategic locations such as Europe, so that the cooperative group can meet customer demand near these sources.
"Our New Zealand farmers will always be our first source of milk, but we must increasingly adapt to our growth and the associated returns through strategic partnerships in Europe, Latin America, Australia and China . These partnerships enable us to to produce the products that are demanding closer to the market and offer more opportunities for the milk and milk products we make elsewhere."
The CEO of Fonterra , Theo Spierings , stated that this development is based on the current, long-term relationship between Fonterra and Rokiskio as a supplier and will be beneficial for both companies.
"Our ability to access high quality whey ingredients is becoming more and more important as demand grows, especially in the markets in Eastern and Western Europe, the Middle East and North Africa. Rokiskio is also a highly respected cheese producer and that also offers us further opportunities to meet customer demand in these markets. This is a new step in our strategy to develop a sustainable European network of resources that provide a reliable and efficient supply chain and a complement to the ingredients from New Zealand. "
Fonterra invests in Rokiskio
Frutarom will acquire the specialty nutrition company Enzymotec for US$ 210 Mn
Mr. Ori Yehudai, President and CEO of Frutarom Group, said: "We are delighted at having signed a definitive agreement for the acquisition of Enzymotec and its merger with Frutarom. This acquisition will provide additional reinforcement to our growing activity in natural specialty fine ingredients based on innovation which is expanding at a rapid pace.
Following our announcement of the acquisition of Enzymotec shares and our intention to make a tender offer, we conducted friendly and professional negotiations with Enzymotec’s board of directors and reached an agreement on acquiring 100% ownership. This amicable transaction offers significant advantages to both parties, including a further boost in value for our shareholders along with providing a quick and efficient implementation of a growth strategy and profitability for Enzymotec’s operations as well as a rapid and effective realization of the significant synergies between the companies.
The merger will enable full integration of the companies’ activities in the fields of R&D, sales, marketing, production, supply chain and logistics while accelerating our joint growth through many cross-selling opportunities inherent in the acquisition and the expansion of the product portfolio to both Enzymotec’s and Frutarom’s existing customer bases.
Upon completion of the transaction we will examine together with Enzymotec management strategic plans suitable for accelerating profitable growth and enhancing its activity while implementing the combination of Enzymotec’s activity and Frutarom’s global activity, along with attaining maximum operational and business efficiencies, improving the cost structure and using Frutarom’s global platform to exploit the great potential concealed in the large investments made in Enzymotec in recent years in the areas of R&D, marketing and production. We particularly see Enzymotec’s nutrition segment as playing an important part in our future profitable growth strategy that will contribute to the expansion of the portfolio of comprehensive solutions for customers of both companies in the fields of pharmaceuticals, dietary supplements, designated foods for infants in the field of infant formula (where Frutarom has almost no activity currently) and elderly clinical nutrition in which Frutarom is active.
Mr. Steve Dubin, Chairman of Enzymotec, said: “We are pleased that we have reached an amicable agreement with Frutarom in a manner that benefits our shareholders. We believe that our customers will also benefit from the merger through Frutarom’s global presence and our employees will have the opportunity to thrive under Frutarom’s leadership as one of the world’s top companies in its field.”
Hearthside Foods to acquire Standard Functional Foods Group
Hearthside Food Solutions announces the signing of a definitive agreement to purchase Standard Functional Foods Group (“SFFG”), a unit of privately held Standard Candy Company, subject to regulatory approval and customary closing conditions. SFFG is a contract manufacturer of nutritional and functional bars located in Nashville, Tennessee.
Hearthside Foods signs agreement to purchase nutrition and energy bar manufacturer Standard Functional Foods Group
The planned acquisition of SFFG will further enhance Hearthside’s entry into the functional bar category, enabling the company to meet the growing demand for a widening array of bars in the US. The addition of SFFG will bring the Hearthside network to a total of 24 production facilities. Terms were not disclosed.
“In addition to new network capacity, geographic reach and production capabilities, SFFG brings leadership in R&D with their ability to design, formulate and commercialize the increasingly complex nutrition and energy bars customers are demanding,” said Rich Scalise, Hearthside Chairman and CEO.
Standard Candy began as a regional confectioner in 1901, and expanded into functional bars in 1999 through SFFG, which currently serves as a contract manufacturer to many of the largest food companies and brands.
Hormel Foods enhances its position in Deli Meats with the acquisition of Columbus Manufacturing, Inc.
Hormel Foods Corporation announced it has entered into a definitive agreement to acquire Columbus Manufacturing, Inc., an authentic, premium deli meat and salami company, from Chicago-based Arbor Investments.
This strategic acquisition positions Hormel Foods as a total deli solutions provider and enhances its other strong deli brands such as Hormel®, Jennie-O®, Applegate®, and Di Lusso®.
“We are pleased to add Columbus to the Hormel Foods family. Columbus has an outstanding reputation in the food industry and is well-positioned in the advantaged retail deli category,” said Jim Snee, president and chief executive officer at Hormel Foods. “Columbus is capitalizing on one of the fastest-growing areas in the retail grocery store with premium, authentic products that are on-trend with today’s consumers who are looking for unique experiences, flavors, and products.”
“The acquisition of Columbus will serve as a catalyst for uniting all our deli businesses into one customer-facing organization,” Snee said. “This acquisition significantly enhances our scale in the deli by broadening our portfolio of products, customers, and consumers. The synergies we can unlock with this acquisition are clear and I’m excited for the next evolution of our company.”
The purchase price is approximately $850 million. Total annual sales are approximately $300 million with an expected growth rate in excess of 5 percent. Hormel Foods expects this acquisition to be modestly accretive to earnings per share in fiscal 2018. Full-year accretion in fiscal 2019 is expected to be between 6 to 8 cents per share.
The company will continue to operate from California and will report into the Refrigerated Foods segment. The transaction is subject to customary closing conditions, including the receipt of regulatory approvals in the United States. Hormel Foods was advised by Barclays and Faegre Baker Daniels LLP. Columbus Manufacturing was advised by BofA Merrill Lynch and DLA Piper LLP (US). In addition, Rothschild provided financial advice to Columbus Manufacturing.
Unilever, announced an agreement to acquire the TAZO brand from Starbucks. TAZO is a leading brand in the fast-growing specialty tea category
Under the asset purchase agreement, Unilever will acquire the TAZO brand and all related intellectual property, signature recipes and inventory for US$384 million. The transaction represents a multiple of 10 times pro forma EBIT. TAZO had sales of US$112.5 million over the past year*.
Founded in 1994, TAZO® has a strong position in Specialty Black, Green and Herbal teas, as well as liquid concentrates focused in the Chai Latte segment. The fast-growing specialty tea segment makes up 48% of the total US$1.6 billion (FY 2016) at-home tea category and trends suggest it will become more prominent in the future**. TAZO® is sold primarily in grocery, mass and convenience channels in the US and Canada, and is offered in formats including packaged teas, K-Cup® pods and bottled ready-to-drink teas.
“With its strong appeal to millennials, TAZO® is a perfect strategic fit for our US portfolio that includes exciting new brands such as Seventh Generation, Dollar Shave Club and Sir Kensington’s,” said Kees Kruythoff, President, Unilever North America. “TAZO®’s solid position in the fast-growing specialty tea segment, coupled with Unilever’s tea expertise, presents a fantastic growth opportunity.
The savannahs of Africa cover a mind-boggling 600 million hectares, of which 400 million hectares are cultivable, the President of the African Development Bank, Akinwumi Adesina, has said.
But just 10% of this is cultivated, a mere 40 million hectares, Adesina said, while speaking at a session titled “Transformation of the African Savannah Initiative” at the 2017 World Food Prize-Borlaug Dialogue symposium in Des Moines, Iowa.
According to the AfDB President, so huge is the potential of African savannahs that the World Bank called the Guinea savanna zone “one of the major underutilised resources in Africa.”
He noted that Africa’s savannahs were better than the savannahs of Brazil, a country notable for turning its savannahs into agricultural wealth, saying Africa’s soils were not acidic and therefore did not need liming which had to be done at massive scales in Brazil.
“The initiative will start by bringing approximately two million hectares of savannah in eight African countries — Ghana, Guinea, Democratic Republic of Congo, Central African Republic, Uganda, Kenya, Zambia, and Mozambique — under the cultivation of maize, soybean, and livestock production in optimum conditions.” The goal: to double production in those eight countries.
“Africa must learn from the experiences that have worked elsewhere, while tailoring the interventions to the specific realities of Africa. We must ensure that small, medium-scale and large-scale commercial farmers co-exist in a way that allows opportunities for all,” Adesina said.
The 2017 World Food Prize Laureate explained that partnerships in research and development would be crucial, saying that was why the AfDB had engaged to work with the strongest possible organisations with proven track records in tropical agriculture from South America.
Some of them, he said, included the Brazilian Research Corporation (EMBRAPA), the Agricultural Corporation of Brazil (CAMPO), as well as others with long experience in conservation agriculture, including the Argentine Association of Zero-tillage (AAPRESID), and the Argentine Agricultural Research Institute.
AfDB launches pilot programme to cultivate the Savannah in eight
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