ETG Farmers Foundation
AATIF concludes US$ 30 mm facility agreement with Export Trading Group to support agricultural supply chain development in Africa
9 February 2016
Export Trading Group (“ETG”), a Pan-African integrated trading and processing company specialized in end-to-end agricultural supply chain management headquartered in Mauritius, and Africa Agriculture and Trade Investment Fund (“AATIF”) have signed a US$ 30 million facility agreement to support the development of the smallholder agriculture sector in Sub-Saharan Africa.
ETG has offices across 40 countries in the world with significant presence across 26 African countries, buying crops from thousands of smallholder farmers without intermediaries and connecting them to global commodity markets, thereby contributing to sustainable employment and income security for local farmers as well as global food security. In addition, ETG provides smallholder farmers with training, agricultural expertise, farming equipment and farming inputs.
The proceeds of AATIF’s facility will be used by ETG as long-term working capital for the export of crops and import of fertilizers as well as the financing of capital expenditures related to processing plants and warehouses.
According to Mahesh R. Patel, Executive Chairman of ETG:
"[We welcome the cooperation between AATIF and ETG to further strengthen ETG’s agricultural supply chain work in Africa. We see this as the beginning of a strategic relationship. This relationship will allow us to continue our work of connecting African smallholder farmers to the world food supply chain despite facing ongoing challenges of infrastructure, skills shortages, and being sensitive towards the social, cultural and political norms of each country]."
Thomas Duve, Chairman of the Board of Directors of AATIF, said:
"The collaboration with ETG falls squarely within AATIF’s strategy to support smallholder farmers through experienced intermediaries and partners like ETG. We are proud of this investment which further increases AATIF’s agricultural footprint in Sub-Saharan Africa, contributing to local employment and value creation as well as the global development agenda of reducing hunger and improving food security.”
According to Astrid Manroth, Head of Sustainable Investments Europe at Deutsche Bank:
"We are very pleased about the successful collaboration with ETG which builds on Deutsche Bank’s Africa network. ETG successfully connects African smallholder farmers to global markets in a sustainable manner, proving once again that investing in AATIF achieves both financial and social objectives.”
Founded in 1967, Export Trading Group (ETG) owns and manages the most vertically integrated agriculture supply chain on the African subcontinent with operations spanning in procurement, processing, warehousing, distribution and merchandising. In addition to ETG’s presence in across 26 African countries, it is actively present in North America, India, China and South East Asia.
The Africa Agriculture and Trade Investment Fund (AATIF) is a public-private partnership fund to realize the potential of Africa's agricultural production, manufacturing, service provision and trade for the benefit of the poor. The Fund aims to provide additional employment and income to farmers, entrepreneurs and labourers alike, including a dedicated effort to support smallholder farming arrangements.
Deutsche Bank Asset Management serves as Investment Manager to AATIF.
EMCL (Export Marketing Company Lda.), drove the groundbreaking initiative “3I (Input, Implement and Information) Farmers Empowerment Hub”. Developed under USAID – P41 / FTF and in partnership with Agro Tractors Limitada and Techno Brain Limited, this project will establish a rural 3I hyper market and extension services across 4 provinces and 27 districts in Mozambique. The program will utilize mobile based ICT solutions to diffuse advanced farming techniques to the smallholder farmers.
Each “Empowerment Hub” comprises of an input shop, an implement rental shop and a warehouse for postharvest storage. There will be shops at each hub run by two selected female entrepreneurs. One will be for agricultural machinery rental and the other to sell agricultural inputs. The Input shop owner becomes an independent entrepreneur from day one, whilst the implement rental shop owner shall repay just 25% of the value of the assets after three years, to become an independent entrepreneur. This implies that ETG not only passes on the entire USAID grant to target the ultimate beneficiaries, but also contributes its own resources.
(Left to right) Mr. T. Sridhar, Director Projects, ETG; Ms. Francisca G.C Muluana Permanent Secretary; HE Dean Pittman, Ambassador of USA to Mozambique; HE Ernesto Max Tonela, Minister of Commerce, Trade and Industry; Mr. Ken Hassan, Agriculture Officer, US Embassy; Mr. Guillermo Machado, Country Director ETG.
The ETG Farmers Foundation (EFF) is a registered non-profit organization established in 2013, with the objective to formalize and build on ETG’s existing smallholder developmental work, as an independent entity. The foundation works in partnership with various entities, including international and national NGO partners and governments, in order to achieve its mission: To develop smallholder agricultural communities in Sub-Saharan Africa so that they can work towards a better future. EFF currently has successful projects operating in both Tanzania and Zimbabwe:
Since 2012, the Foundation has encouraged and supported farmers to grow cash crops such as oils seeds (sesame) and pulses (pigeon peas, green gram) and implemented farming programmes featuring: input finance, group management, basic business skills and agricultural practices training. Furthermore, EFF introduced an ICT platform featuring a range of functionalities including farmers profiling, SMS training, mobile money payments and database management systems. Currently 10,000 farmers and 250 students are enrolled in our projects.
New projects include the Kagera Coffee Project funded by the Bill and Melinda Gates Foundation, the introduction of improved sesame seed in the Mbeya region in partnership with AGRA, and the cultivation of cash crops such as pulses and sesame as sustainable alternatives to informal artisanal gold mining, supported by Shanta Mine in the Songwe region. In partnership with TODEP and implementing partner Zanzibar Sugar Factory, EFF has also executed an Ethanol School Project to create awareness on climate change, fight deforestation and enable access to clean cooking fuel. The project is in line with our commitment to the Sustainable Development Goals set by the United Nations, to promote gender inclusiveness and renewable energy sources.
One of the key objectives was to introduce mechanization, increase the production of suitable high value crops, provide a direct market, and provide the necessary knowledge to achieve the above. Through our efforts, EFF has introduced and increased Sesame production from the Gokwe to Nyaki regions, by linking a large number of farmers to financial institutions in order to receive small input loans. The outreach program has expanded significantly to include up to 27,000 farmers intending to plant sesame this 2016/17 season.
The Foundation also provides its small-holder farmer partners in the Guruve community with access to mechanization on a pre-payment cash paid bases. Our Agri-depots offer tractor services for ploughing, planting and disking. Our first season enabled farmers to increase their soya and maize production and with the rainy season starting early this year, EFF’s tractor services have been high in demand reaching over 450 farmers since September.