USD4.5m invested in potato farming in Zambia

Social impact investor and project developer AGDEVCO has invested in a US$4.5 million partnership with Saise Farming Enterprises Limited (SFEL) to produce potato seed for smallholder farmers in Northern Province of Zambia.

AGDEVCO (African Agricultural Development Company) is a non-profit investment company aiming to reduce poverty and to increase food security. The social impact investor and project developer has made over 35 investments to date - in Ghana, Malawi, Mozambique, Tanzania, Uganda and Zambia - and continues to expand rapidly. Any profit is reinvested.

The project will allow for import substitution as well as create export opportunities for the crop.

In response to a query recently, AgDevCo Zambia’s country director Peter MacSporran said the venture will help create a more reliable local supply and enable farmers, grow potatoes using affordable seed to improve food security.

Mr MacSporran said as of last month, the firm had prepared a 15 hectares field and pivots in readiness for planting potatoe seed.

Peter MacSporran, AgDevCo Zambia’s country director:
 

“In total, AgDevCo has invested US$4.5 million in a partnership which will primarily be a seed potato farm hub and act as an anchor investment within the Northern hub.”

“This will enable crops to be grown under irrigation, ensuring security against droughts. Potatoes will also be grown in winter, the period of lowest disease pressure, and will be stored in climate-controlled warehouses for the following year’s distribution to farmers.”

The Project

 

AgDevCo believes that profitable agriculture with strong links to markets is the best route out of poverty for the majority of Africa's rural poor.

The Challenges

Zambia currently imports close to 100% of its seed potato requirements. This project will allow for import substitution as well as export opportunities. The farm is also intended to kick-start investment in an area where there is currently little formal agricultural investment. Power outages, potato pests and diseases as well as droughts provide a challenging environment for growing seed potatoes, hence a reliable power supply and irrigation are paramount for the successful cultivation of this crop.

Project Approach

AgDevCo’s investment of $3.9m will be used to establish irrigation (250ha) and power. In addition, farm equipment, sheds, cold stores and machinery will be purchased. This will enable crops to be grown under irrigation ensuring security against droughts. Potatoes will also be grown in the winter, the period of lowest disease pressure, and will be stored in climate-controlled warehouses for the following year’s distribution to farmers. In addition, a disease testing laboratory will be established to ensure quality control of potato seed grown; enabling export of potato seed to Tanzania, Rwanda and DRC.

Project Impact
 

• The farm will grow 50ha of seed potatoes annually at steady state.
• Export enquiries received for c.500t of seed equating to 30% of annual production.
• First year’s field of 15ha already prepared and pivot being erected for planting seed potatoes in May 2016.
• 55ha of irrigation to be established annually leading up to a final 217ha of irrigated production.

Social Impact
 

• improved livelihoods:The project is expected to produce enough small-sized seed for 104 smallholders and it will create 80 FTE jobs (50% women).
• Uplift in Income:Farmers will be able to grow potatoes using affordable seed. This will lead to an income uplift of c.$316 per farmer per annum. Employees will receive an income uplift of c.$1,060.
• Food Security:Currently seed potatoes in Zambia are 100% imported. Local production will enable a more reliable local supply (50% import substitution). Wheat and soybeans are also to be grown, improving local food security.
• Improved Communities:Employment in an area where there is currently little formal employment. Farm is expected to act as catalyst for establishment of fertiliser, agrochemical and technical expertise in the area.

Source: AgDevCo: Saise Farming Enterprises Project