Covid-19 has highlighted the need for greater food self-sufficiency in Africa. The winners in Africa’s agricultural sector will be those who can provide food security, says MD Ramesh
As the largest economy and the most populous country on this rich continent, Nigeria truly has a golden opportunity to lead the march and set benchmarks for how African countries should reshape their economies and prepare their industry in response to the impact of the Covid-19 pandemic.
To its credit, the government of Nigeria has reacted well by rapidly swinging into action, enforcing preventive measures and setting up isolation camps. The response around civil distancing has been well communicated and the leadership at various levels has been reaching out to the populace to keep it well informed. The health authorities have been visiting factories to ensure the necessary sanitary precautions are in place.
The TGI group, where I serve as the group CEO for our agriculture business, has had a long and successful history of commerce in Africa with much of the action focused in West Africa. Given low levels of food production throughout the continent, the founders of the group saw a gap and positioned the business to focus on local production – that is foods processed locally to serve local dietary needs. Some of the by-products are exported and serve to generate precious foreign exchange.
The founders focused on a fully integrated approach to agriculture. For example, they looked to convert oil seeds into edible oil for human consumption and seed cake for animal feed; local paddy was converted to premium local rice and locally grown raw cashews were processed into choice kernels for export markets.
All these activities were strategically chosen to serve the four imperatives of the African conundrum – employment, import substitution, upskilling and food security.
As the pandemic reached our countries of operation, like most companies, our primary focus was the safety of our colleagues. We introduced new processes and made arrangements so that the living quarters and factories complied with vetted hygiene requirements and provided our teams with the necessary prevention equipment.
With regards out-grower programmes, it was a matter of protecting both lives and livelihoods. We respected our commitments to service our farmers in rice, cotton and soya, and despite the various challenges, we managed to ensure that seed and other agriculture inputs continued to be provided to these farmers, whilst taking the necessary precautions.
Shortening supply chains
So what have we learned? The pandemic has highlighted the need for greater food sufficiency, especially in light of closed borders and broken supply chains. We stand by our belief that the emerging champions of this pandemic will be those that can contribute to food security and self-sufficiency.
We anticipate tighter restrictions in terms of food imports, which in any case are becoming less fashionable. This is already happening. Today it’s about shortening the supply chain and this is aligned to the different strategies to bring in more local content and local solutions to food systems.
Urban areas provided an interesting stress test during this pandemic. Urbanisation throughout the continent is a reality and, with cities under lockdown, we saw how vulnerable these could be, especially as connectivity to where food production takes place is sub-optimal.
This resulted in shortages of essentials and has highlighted the need to set up small cultivation areas, strategically located on the outskirts of our megacities. It’s an opportunity to create new value chains and empower small-scale farmers to help them grow essentials such as vegetables and seasonal fruits to serve these urban centres.
In a display of a perfectly symbiotic relationship, the farmer gains from a huge ready market nearby while farming on relatively cheap land, while the city secures the supplies of fruits, vegetables, poultry and dairy products, with a low carbon footprint to boot.
This is but a small demonstration of how countries will have to apply special focuses on agriculture, develop sustainable and viable ecosystems and work out methods to feed themselves and be resilient to different shocks. Business as usual won’t work.
Import-trading is passé. It was interesting to see in July the Central Bank of Nigeria terminate the allocation of foreign exchange to maize importers. It’s a sign that governments want to move towards complete self-sufficiency.
However, these policy measures need to be coordinated: that is, production needs to be built around higher yields, using productive seeds, cheap inputs, available finance, with the farmer knowing that there is an off-taker of his product.
Having worked in African agriculture for over 25 years, we still haven’t resolved the yields issue. At the same time, we need to strengthen storage and processing facilities. The good news is that we are seeing increased urgency to deal with all these issues following the pandemic.
It is essential to gain governmental policy support to find alternate crops that grow in plenty in our climates but which have been overlooked in the past because of negative perceptions or Western eating habits. We have seen it to some extent with cassava, which has replaced many crops that Nigeria used to import to produce bread and even beer.
Thereafter, the private sector can play its role in processing, packaging and marketing these foods to local markets. A study produced five years ago in Southern and Central Africa uncovered about 20 different substitutes to the traditional carbohydrate grains like rice, maize and wheat.
If this indigenisation trend indeed catches up and the private sector plays ball, it will create a new dynamism in terms of food production and processing that can only be beneficial for the continent.
Like the Ethiopian super-grain teff and the West African fonio, there are many underexposed and unknown possibilities that we, as Africans, need to uncover, embrace and innovate within our feeding programmes. Sheanut and sorghum are two other examples of such food products that can plug and play into the food basket.
With domestication of food production in mind, the big five imports on the continent – wheat, rice, sugar, edible oil and dairy – should be pointedly targeted by the leadership in each country. These comprise 80% of the total food import bill for Africa.
Dairy is really a sitting duck: we have the head count in terms of cattle, we are simply missing adequate and efficient cold chains. Kenya has shown the way it can be done and a thriving dairy industry there demonstrates the impact on employment, import substitution and local industry benefits. This is a live African success example that can be replicated by other countries.
It’s now the time for leadership in Africa to step up. The pandemic has forced our hands by exposing the vulnerability of the nation and its population to uncontrollable factors. While the private sector will have to lead the way with innovation, imagination and investment in this post-Covid world, government has to provide leadership by paving the way for the local food industry to thrive.
The African customer awaits well positioned businesses with innovative and convenient food solutions. Let’s play!
MD Ramesh is Group CEO TGI AGRI Business, a consumer goods business with a large focus on Nigeria. It plans to invest $700m in agriculture over the next five years.