com-watch - issue 39 - august 2014 watch - issue...zambia: 12,000 farmers to get peanut seed /...

IVORY COAST TO BOOST COTTON OUTPUT TO 600,000T

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AFRICACOM-WATCH

Zimbabwe To Raise Cooking Oil Output From Cotton Seeds

ISSUE 39 | AUGUST 2014

Southern African States / EU Sign Trade Pact

South Africa: Chicken Imports ‘Stockpiled To Avoid Duty’

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Zimbabwe To Raise Cooking Oil Output From Cotton Seeds

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Ivory Coast To Boost Cotton Output To 600,000T

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22

25

Southern African States / EU Sign Trade Pact

South Africa: Chicken Imports ‘Stockpiled To Avoid Duty’

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AFRICACOM-WATCH

ISSUE 39 | AUGUST 2014

Contents03 / General News

04 / Banana & Plantain

05 / Cashew & Groundnut

08 / Cassava

09 / Cocoa

15 / Coffee

17 / Cotton, Textiles & Leather Goods

21 / Fish

22 / Foodstuffs

28 / Palm & Cooking Oil

29 / Rubber

30 / Sugar

34 / Tea

36 / Timber

39 / Tobacco

Top Stories

News Headlines By RegionWestern AfricaCAMEROON: PHP To Create 800 Hectare Banana Plantation / Cocoa Grind Purchases Up / Olam, Telcar Cocoa And Producam Main Exporters In June / The Agropole Programme - FCFA2.6 Billion For Cocoa Development / Cocoa Farmgate Prices Up Slightly By Mid-July / Justin Sugar Mills Batouri Project / Cameroon Timber Exports Face DelayCOTE D’IVOIRE: 22% Of Banana Farms Lost To Flooding / Cocoa Farmers Unable to Deliver Beans on Rain / Rains Boost Cocoa Main Crop, Could Harm Mid-Crop / Ivory Coast To Boost Cotton Output To 600,000T DRC: Cotton Revival / DRC To Freely Export Afromosia GAMBIA: 15th Global Cashew ExporterGHANA: Cashew Generated US$170 Million In 2013 / Cocobod To Buy More Next Season - Seals US$2 Billion Loan / Biggest Cocoa Buyer Delays French Loan On Cedi Slide / Currency Slump Prompts Sharp Rise in Cocoa Smuggling / Cocoa Industry To Get US$26 Million Boost / Cocoa Farmers To Get Support From Dutch / COCOBOD To Provide Free Fertilizer / Forum Advocates Measures To Increase Cocoa Production / Solidaridad Launches West Africa Oil Palm Initiative / Ghana’s Timber Export Earnings Fall / Wood Processing Set To Get More Government SupportGUINEA BISSAU: Cashew Exports Up 40% / Guinea Bissau Government Suspends Exports Of WoodMALI: Mali Sets 2014-15 Cotton Production Target At 600,000 TonsNIGERIA: IFDC, Psaltry, Nigerian Breweries Sign Mou To Expand Cassava Use / Cooperative Cassava Union Enters Production Agreement / Farmers Urged To Embrace High-Yielding Cassava Stems / Cocoa Shipments Halted In Southeast Over Tax Dispute / Cocoa Mid-Crop Signalling More Production / Olam To Invest US$100 Million In Commercial Rice ProductionSENEGAL: Successful Groundnut Campaign / Sodefitex To Achieve 85% Cotton Production

Eastern AfricaBURUNDI: Burundi Q1 Tea Revenue Down On Higher Kenya OutputKENYA: Government Seeks Consultancy For Commodities Exchange / Macadamia New Green Gold For Farmers / Top Grade Coffee Price Flat / Danone Buys 40% Stake In Kenya’s Brookside / Kenya Importing 200,000 Tonnes of Maize From Tanzania / H1 Raw Sugar Output Rises 20% On Improved Cane Supply / ALTEO To Take Control Of The Kenyan TSCL Sugar Company / Senate To Investigate Mombasa Tea Auction Over Shady Deals / Tea Farmers Get Sh1.5 BillionMALAWI: US$15 Million Investment In Malawi Mangoes / Tobacco Export Increases 36% / Malawi Earns Over US$200m In Tobacco SalesMOZAMBIQUE: Cashew Trees In Mozambique To Be Treated For Pests / Informal Cashew Nut Processing To Receive Support / Cassava Production Expected To Reach 14.7 Million Tons In 2014 / Investors Interested In Tuna Fishing / Vietnam Funds Assessment Of Mozambique’s Real Agricultural Potential / Rice Production In Mozambique Expected To Fall In 2014RWANDA: Rwanda, China Sign US$10 Million Textile Deal / Rwanda Tea to Coffee Earnings Fell in First 4-MonthsTANZANIA: Revival Of Cashew / Sh16 Billion Cassava Processing In Kibaha / Coffee Growers Urged to Work Collectively / Bulk Sugar Procurement Starts September, Agro Ecoenergy Project Stranded / Forestry Scheme Takes OffUGANDA: Uganda Could Grow Vitamin A-Enriched Banana By 2020 / Coffee Exports Down 27% Yr-Yr In June / Abi Group, Opportunity Bank Boost Coffee Output / EPRC Push Ugandan Government To Aid Coffee Industry / FOCUS: Earning Big From Organic Agriculture / Sugar Exports Curbed By Regional Trade Barriers / Farmers Fighting For Tobacco

Southern AfricaSOUTH AFRICA: Chicken Imports ‘Stockpiled To Avoid Duty’ SWAZILAND: Sugar Production Expected To Increase Post EPA / SSA Reduces Price To Compete Against Overseas SugarZAMBIA: 12,000 Farmers To Get Peanut Seed / Reintroduction Of Forest Rangers As Illegal Logging Threatens Industry / Tobacco Harvest UpZIMBABWE: Groundnut Production To Increase / United Refineries To Raise Cooking Oil Output From Cotton Seeds / Corn Production Increases 82% To 1.46 Million Tons / Zimbabwe to Host SADC Sugar Producers’ Conference / Tobacco Sales Highest Since 2001 / MTC Invests US$37 Million In Tobacco Inputs

mpts Sharp Rise t From Dutch / Solidaridad

Set To Get More

ood

ava Union Enters ents Halted

armers Tonnes ontrol Of

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THE AFRICAN COMMODITY REPORTBrought to you by CMA CGM / DELMAS Marketing

Rachel Bennett Dominic Rawle

Kenya Government Seeks Consultancy For Commodities ExchangeThe Kenyan government is seeking experts to advise in the process of setting up a national commodities exchange, an entity that will be private sector-led. The selected consultancy will work closely with a National Commodity Exchange Task-force to a policy, regulatory and legal framework for the Kenya Commodities Exchange [KCX]. The KCX, when set up, is expected to improve the competitiveness of local commodity exports and stimulate value addition and processing to mitigate post-harvest losses of agricultural produce. The disclosure comes just as the East Africa Exchange [www.ea-africaexchange.com] was unveiled at the 6th Northern Corridor Integration Projects Summit in Kigali, Rwanda. EAX is owned by the Africa Exchange Holdings - an entity made up of Nigerian businessman Tony Elumelu’s Heirs Holdings, former US Assistant Secretary of State for African Affairs Dr Jendayi Frazer’s 50 Ventures and Nicolas Berggruen of Berggruen Holdings.

[The Star 05/07/14]

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COMMODITY NEWSGENERAL NEWS

CameroonPHP To Create 800 Hectare Banana PlantationIn addition to the 3000-ha that it already operates in the Mungo département , la Société des Plantations du Haut Penja [PHP] thfood company controlled by the Compagnie fruitière de Marseille, plans to create a new banana plantation on an area of 800-ha around Dawson. Industry leader PHP controls 5% of national production. PHP was created from the merger of Société des Bananeraies de la Mbome [SBM], Société des plantations nouvelles de Penja [SPNP] and Plantations du Haut Penja [PHP]. PHP has exported 55,518 tonnes of bananas by mid-2014 with annual production estimated at 120,000 tons.

[Ecofin 17/07/14]

Cote d’Ivoire22% Of Banana Farms Lost To FloodingCote d’Ivoire may lose about 115,000 tonnes of banana meant for export to Europe due to heavy rainfall. Several hectares, especially in Songon region, were destroyed by heavy rains that fell in June. The disaster destroyed 22% of the country’s total banana farms. Meanwhile government continues to work toward realising Cote d’Ivoire’s dream of exporting 300,000 tonnes of banana annually. Banana caters for about 5% of GDP. The country emerged Africa’s largest producer of banana in 2013 with a national output of 240,000 tonnes.

[NAN 16/07/14]

UgandaUganda Could Grow Vitamin A-Enriched Banana By 2020Farmers in Uganda and other East African countries could be growing bananas enriched with vitamin A by 2020 if the world’s first human trial of the biotechnology - which is to start in October - becomes a success. Legislation to aid genetically-modified crops to be commercialised in Uganda, currently in Uganda’s parliament, could be in place by 2020 to boost the adoption of the biotechnology by farmers.

The human trial of the bananas will take place in the United States and the results are expected by the end of the year.

Field trial of the bananas, conducted first in Australia, yielded high-performing genes. The genes were then transferred to Uganda for further field trials, which they expect to yield elite banana plants in the next 3-years for large-scale tests throughout Uganda. The project, backed by a US$10 million grant from the Bill and Melinda Gates Foundation, has the potential to make a positive impact on staple food products across much of Africa.

[SciDev 09/07/14]

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COMMODITY NEWSBANANA & PLANTAIN

Gambia 15th Global Cashew ExporterThe Gambia has been ranked as the world’s 15th largest exporter of Raw Cashew Nut [RCN] with a 0.1% market share in the global RCN market. According to The Gambia Cashew Sector development and Export Strategy 2014-2019 the position is due to constant export of RCN mainly to India. The global growth rate of 9% [import] for RCN and 9% for cashew kernels offers an opportunity for The Gambia cashew sector to emerge and support the country’s export development. Gambian RCN exports although concentrated on India [95%] have also reached a much larger number of destination markets, such as the UAE, Vietnam, China, Denmark, Senegal, Singapore and the United States.

[APA 26/06/14]

GhanaCashew Generated US$170 Million In 2013The cashew industry generated US$170 million in the form of foreign exchange earnings for the economy in 2013. Levels were announced at the closing session of a 5-day training programme, for 60-stakeholders in the sector, drawn from Ghana, Burkina-Faso, Togo, Benin, Cote d’Ivoire, Senegal and Sierra Leone. It was organised by the African Cashew Initiative [ACi] in collaboration with African Cashew Alliance with support from the Ministry of Food and Agriculture and the Cocoa Research Institute of Ghana aimed at developing a pool of certified cashew experts in West Africa, with in-depth knowledge on the cashew value chain. Topics covered economics of cashew production and cashew processing, development of improved planting material, data collection methods for proper monitoring and evaluation as well as alternative and innovative media for disseminating information and collecting data.

[Ghana Web 20/07/14]

Guinea BissauCashew Exports Up 40%Guinea-Bissau’s 2014 cashew exports reached 70,000 tonnes by July 19 since the start of the season in March, up 40% on the same period last year. Furthermore another 60,000 tonnes of cashew nuts are awaiting shipment, bringing this year’s harvest to just under the total production last year of 140,000 tonnes. The newly elected government is prioritising the cashew sector over timber exports. Timber exports from Bissau, to China especially, rose spectacularly during transition rule because of illegal logging. Fears that the government may clamp down on timber exports have caused congestion at the country’s main port as timber operators scramble to ship out their wood before a possible ban. The government has also said it will stop the smuggling of cashews over the border into neighbouring Senegal, a flow that is said to cost Guinea-Bissau some 60,000 tonnes of nuts each year. Guinea-Bissau is the world’s 5th-largest cashew exporter behind India, Vietnam, Ivory Coast and Brazil.

[Reuters 22/07/14]

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COMMODITY NEWSCASHEW & GROUNDNUT

KenyaMacadamia New Green Gold For FarmersFor many years, tea and coffee farming has been a major source of income for thousands of farmers. However farmers are switching to macadamia nut farming as the product fetches better prices. Farmers sell their product to brokers who link them with processing companies. However farmers face a major challenge of poor marketing systems and unscrupulous brokers.

[Freshplaza 17/07/14]

MozambiqueCashew Trees In Mozambique To Be Treated For PestsAround 4.5 million cashew trees in Mozambique will this year be sprayed to prevent pests that affect cashew nut production. The National Cashew Institute [INCAJU] launched the National Cashew Tree Treatment Campaign noting that half the trees due to be sprayed were located in Nampula province, the largest cashew production area. INCAJU announced that the government is studying market mechanisms and should soon set the benchmark price in Mozambique for the sale of cashews.

[Macauhub 14/07/14]

Informal Cashew Nut Processing To Receive SupportMozambique’s Cashew Institute [Incaju] will provide informal cashew processors with small husking units and packages for storing the product. The support would be provided to provinces involving around half a million families. Estimates from Incaju on national cashew production last season point to total production of around 60,000 tons, and half of that amount is expected to be processed through informal channels. One of the aims of the campaign was to improve the quality of cashew packaging as a way of attracting customers and adding value to the product. Informal processors are also being advised to organise themselves into an association to have access to husking units and packaging.

[Macauhub 24/07/14]

SenegalSuccessful Groundnut CampaignThe campaign of groundnut commercialisation in Senegal has been a success exceeding the initial target of 300,000 tonnes. 313 836 tons has been achieved despite the reluctance of some industrialists against the transfer price fixed by the National Interprofessional Committee Of Groundnut / Comité National Interprofessionnel de l’Arachide [CNIA].

[Ecofin 20/07/14]

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TanzaniaRevival Of Cashew The government will this year embark on a revival programme of 4-cashewnut processing plants in the southern regions. Facilities lined up for rehabilitation are Newala-1, Masasi, Lindi and Nachingwea at an estimated cost of £44 million. Once complete the plants would be able to process a cumulative total of 29,500 tonnes of cashew.

The plants are among 12 formerly government-owned processing units which were privatised in the mid-1990s when the state embraced a divestiture programme at the behest of the World Bank and the International Monetary Fund.

According to latest figures, Tanzania is on the road to regaining its glory in cashew production as in the financial year 2010/2011 it produced 121,135 tonnes, and exceeded the level in 2011/2012 when it notched 158,714 tonnes.


Zambia12,000 Farmers To Get Peanut SeedThe number of groundnut farmers who will benefit from the Farmer Input Support Programme [FISP] for the 2014/2015 farming season has increased to more than 12,000 who will be given seed packs. In the 2013/2014 farming season, only 1,123 beneficiaries received such packs.

Therecent 38th Eastern Province Agricultural and Commercial show held under the theme: “2014, breaking new ground” focused on the economic development strategies in agriculture - prioritising irrigation development, diversification in production, cooperative development, marketing and agribusiness, fisheries, livestock and out-grower schemes.

[Daily Mail 09/07/14]

ZimbabweGroundnut Production To IncreaseZimbabwe’s groundnuts output is projected to increase from last year’s 85,000MT to 130,000 MT this year due to good rainfalls.

The Small Grains and Cereal Producers Association also noted an increase in hectarage of over 155,000-ha planted this year. However farmers often lack satisfied or standardized seeds with many of them recycling which has result in reduce yield. The Grain Marketing Board [GMB] has pegged ground nuts price at US$1300/MT.

[Bulawayo24 01/07/14]

7

COMMODITY NEWSCASHEW & GROUNDNUT

MozambiqueCassava Production Expected To Reach 14.7 Million Tons In 2014Cassava production in Mozambique is expected to reach 14.7 million tons this year, an increase of 5 million tons on the average for the last 5-years. However Mozambique has yet to achieve satisfactory levels in terms of the quality of the tuber and a greater surplus of flour. Cassava is the second most important crop in Mozambique and is one of the main sources of food. Cassava production is mainly focused on the provinces of Cabo Delgado, Nampula, Zambézia and Inhambane.

[Macauhub 08/07/14]

NigeriaIFDC, Psaltry, Nigerian Breweries Sign Mou To Expand Cassava UseInternational Fertilizer Development Center [IFDC], Psaltry International, Ltd., a Nigerian cassava processor and Nigerian Breweries, a subsidiary of Heineken have signed a Memorandum of Understanding [MoU] to promote Nigerian cassava production for use in brewing beer and create additional resources for Nigerian farmers in general.

Farmers are about to receive a strong boost from IFDC’s public-private partnership [PPP] program, [2SCALE PPPs] work out deals between large companies and smallholder farmers to arrange a production chain for mutual benefit. The PPP offers farmers a more secure buyer – Psaltry International – who will buy and process the produce before it spoils.

Through the deal, IFDC said local brewers would have option to use cassava as a base in place of barley and wheat that are mostly imported. Nigeria is the world’s top producer for cassava, producing more than 42 million MT annually.

[Worldstagegroup 02/07/14]

Cooperative Union Enters Production Agreement The Cassava Farmers’ Cooperative Union [BCFCU] in Borno [50,000 farmers] has entered into an agreement with Union Bank Plc toward boosting cassava production in the state. The partnership was initiated under the Nigerian Incentive Based Risk Sharing for Agricultural Lending [NIRSAL] and will allow farmers to access loans payable in 4-years to boost their production.


Farmers Urged To Embrace High-Yielding Stems Cassava farmers have been charged to embrace high-yielding stems in order to obtain better productivity at the second edition of the Farmers Field Day organised by the International Institute of Tropical Agriculture [IITA].

[Tribune 06/07/14]

TanzaniaSh16 Billion Cassava Processing In KibahaAbout 16bn/- has been allocated to a cassava processing project in Kibaha. The scheme will be implemented in 2-phases, jointly by American Company FJS African Starch Development Limited and the Tanzania Investment Bank [TIB]. A 240 acre farm will have the capacity to process 400 tonnes of raw cassava which will produce 100 tonnes of starch per day.

[Daily News 23/07/14]

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COMMODITY NEWSCASSAVA

CameroonOlam, Telcar Cocoa And Producam Main Exporters In June

According to the National Cocoa and Coffee Board [ONCC] cocoa exports reached 4,526 tonnes in June - a 50% increase on the 2,305 tonnes recorded in June 2013. These exports were made by 11 exporters, but 3-accounted for 60% of the exports.

At the top of the list is Producam, which exported 1,003 tonnes of cocoa in June followed by the Olam group with 983 tonnes and Telcar Cocoa, Cargill’s Cameroonian trading company, which exported 853 tonnes in June 2014. Overall, the ONCC statistics reveal that Cameroon has already exported 152,941 tonnes of cocoa since the current season began on August 1, 2013.

This suggests a 25% decline compared to the 203,220 tonnes exported over the same period the previous cocoa season.

[Business in Cameroon 23/07/14]

The Agropole Programme - FCFA2.6 Billion For Cocoa DevelopmentThe Government has launched the Agropole Programme to encourage second generation agriculture and has disbursement FCFA 2.6 Billion to assist farmers secure inputs and young plants as well as help in road development around the new Noha Nyamedjo & Transmar SA cocoa processing unit in Bonaberi.

One billion FCFA from the total amount will be directed to local cocoa suppliers [farmers] and FCFA 1.6 billion for the factory and roads. Construction is to start mid July 2014. All products will be exported through the Transmar Group which will buy all products produced by the factory and sell to international markets. The unit has the capacity to transform 25,000 tonnes of cocoa annually for the production of cocoa liquor, cocoa powder and cocoa butter.

[Cameroon Tribune 08/07/14]

Cocoa Farmgate Prices Up Slightly By Mid-JulyCocoa farmgate prices rose slightly across most of the country’s growing regions in July, as the government moved to crack down on illegal buyers. The authorities are encouraging the creation of new farmer cooperatives to boost growers’ ability to dictate their selling prices. Additional law enforcement officers have also been sent to cocoa areas in an attempt to limit the influence of unregistered buyers, who go door-to-door negotiating with individual farmers.

Cameroon’s cocoa output hit a record of 240,000 tonnes in the 2010/11 season but slipped to 220,000 tonnes in 2011/12 due to attacks by pests and diseases and a prolonged dry season. It then rose to 228,948 tonnes in 2012/13, and is expected to rise to around 235,000 tonnes in the ongoing 2013/14 season. Below are the average farmgate prices in CFA francs per kg recorded across the regions by mid-June:

Region South-West Centre South East

District Mam

fe

Ko

nye

Mb

ong

e

Muy

uka

Kum

ba

Baf

ia

Em

ana

Mb

alm

ayo

Eb

olo

wa

San

gm

elim

a

Ber

toua

Yoka

do

uma

July 1,000 1,175 1,180 1,180 1,200 1,250 1,185 1,175 1,050 1,100 870 800

June 985 1,125 1,120 1,125 1,130 1,240 1,150 1,025 900 975 850 800

[Reuters 15/07/14]

9

COMMODITY NEWSCOCOA

Cocoa Grind Purchases UpCameroon’s local cocoa grinders purchased 32,042 MT of beans for grinding by the end of June, up from 30,496 MT in the same period in the 2012/13 season. The National Cocoa and Coffee Board [NCCB] noted the leading grinder Sic-Cacaos, a subsidiary of Swiss chocolate manufacturer Barry Callebaut, bought 31,116 tonnes by the end of June since the start of the 2013/14 season in August, up from 28,494 tonnes in the same period last year.

Sic-Cacaos bought 1,091 tonnes in June, up from 521 tonnes in May but down from 1,291 tonnes for the same month a year ago. A second local grinding company Chocolaterie Confiserie du Cameroun [CHOCOCAM] bought 131 tonnes in June, up from zero in May and the same amount of purchases as this month last year. Its total since the start of the season now stands at 926 tonnes, down from 2,002 tonnes for the same period in the 2012/13 season.

Sic-Cacaos processes raw cocoa beans into cocoa powder, cocoa cake and cocoa liquor which are sold in the six nations of the CEMAC sub-region, while CHOCOCAM, an affiliate of South Africa’s Tiger Brand, manufactures chocolate sold in Cameroon.

[Business Recorder 22/07/14]

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Cote d’IvoireCocoa Farmers Unable to Deliver Beans on RainFloods in Ivory Coast are keeping trucks from delivering cocoa beans from some farms. Rain averaged 12 mm a day in 15 cocoa-growing areas in the week ended July 6, up from 7 mm a day the week before. Combined precipitation rose to 1,238 mm from 657 mm. Downpours over the past month have damaged roads leading to the San Pedro port and preventing beans from drying and fermenting properly. Exporters rejected at least 33% of bean deliveries to ports at San Pedro and Abidjan at the end of June. Ivory Coast will produce a record 1.6 million to 1.67 million MT in the 2013-14 season after regular rain helped pod development according to government regulator Conseil du Cafe-Cacao [CCC]. The CCC sold more than 1.05 million tons of the 2014-15 crop, allowing to raise the fixed farmer price to more than 800 CFA francs per kilograms.

[Bloomberg 08/07/14]

Rains Boost Main Crop, Could Harm Mid-CropHeavy rains last week in most of Ivory Coast’s main cocoa growing regions has aided the development of the next main crop harvest but threatened to provoke outbreaks of disease that could damage late mid-crop beans. The world’s top cocoa grower is in the midst of its April-to-September mid-crop and is on track for record production this season. With harvesting expected to decline from mid-July, interest of the weather is now turning toward the next main crop due to open in October. World prices hit their highest level in nearly 3-years last week on concerns that growing demand for chocolate will result in a cocoa supply shortfall in the coming years. High humidity would favour good flowering for the next main crop. However, farmers are worried that pods expected to be harvested before October were vulnerable to fungal black pod disease. Growing conditions were better in the western region of Daloa - responsible for 25% of the country’s output - where farmers reported several downpours mixed with sunshine. Similar growing conditions were reported in the eastern region of Abengourou.

[Reuters 30/06/14]

11

COMMODITY NEWSCOCOA

GhanaCocobod To Buy More Next Season - Seals US$2 Billion LoanIndustry regulator Cocobod will buy at least 950,000 MT of cocoa in the 2014/15 crop year, which begins in October, up 5.5% on forecasts for the current harves. Ghana will sign a syndicated loan of US$2 billion from international banks in September to finance the purchases and related operations. The loan for the 2014/15 season was previously expected to be US$1.8 billion. Cocobod is hoping to buy a cumulative 900,000 MT of cocoa in the current crop year which ends in September.

[Reuters 18/07/14]

Biggest Buyer Delays French Loan On Cedi SlideThe Produce Buying Co. [PBC], Ghana’s largest purchaser, delayed plans to borrow US$30 million from France’s development agency as Africa’s worst-performing currency threatened to raise repayment costs. PBC, which planned to use the Agence Francaise de Developpement funds to buy cocoa beans and build sheds and depots for the current season, expects to conclude a deal in the next harvest.

The cedi has fallen 31% this year against the dollar, the biggest drop among 24 African currencies. Companies are battling the weaker currency that pushed the inflation rate to 15% in June, a 10th straight month of increases. Accra-based PBC is looking to cut repayment costs on the loans it needs to buy cocoa as profit after tax in the 6-months through March dropped 45% to 3.9 million cedis [$1.1 million]. PBC increased its borrowing from industry regulator Ghana Cocoa Board to 450 million cedis from 400 million cedis because of the delayed French loan.

This season’s harvest ends in September and the next one begins the following month. Borrowing from Cocobod is cheaper than rates at local commercial lenders - 18% instead of 25%. The company bought 285,000 MT of beans in the main crop season through June 12 from 265,000 tons a year ago. It’s targeting purchases of 35,000 tons in the light crop season that started July 4 and expected to end Sept. 30, from 30,000 tons a year earlier. PBC has fallen 18% this year on the Ghana Stock Exchange [GGSECI].


Currency Slump Prompts Sharp Rise in Cocoa SmugglingA steep drop in Ghana’s currency means neighbour Ivory Coast’s cocoa output is getting an unexpected bump. A 41% drop in the value of Ghana’s currency this year means that Ghanaian cocoa farmers can get 58% more in dollar terms for their cocoa beans in Ivory Coast.

The drop in the cedi, Ghana’s currency, has eroded farmers’ real incomes and has driven a surge in bean smuggling to Cote d’Ivoire in search of better prices. Both countries are struggling to expand production amid surging global demand for chocolate products. Cocoa for delivery in September on the ICE Futures U.S. exchange was trading at a 3-year high of US$3,234 a tonne on July 24th. It’s the 6th consecutive session of gains for cocoa prices after demand in North America and Asia beat analysts’ expectations. Cocoa processors in Asia ground 161,805 MT of beans in Q2 up 5.2% compared with the same period of 2013. The report followed a 4.5% increase in North American Q2 cocoa grindings, which topped market estimates of 2% to 3%. Meanwhile a unit of confectionary company Mars noted it raised prices for U.S. chocolate products by about 7% to offset rising costs a week after Hershey raised its prices by 8% due to higher costs for cocoa, milk and other commodities.

To encourage farmers to keep producing cocoa and stop the smuggling Ghana’s cocoa-industry regulator has been urged to substantially raise the fixed farm-gate prices that producers receive for their beans.

[WSJ 24/07/14]

12

Cocoa Industry To Get US$26 Million BoostEcom Agroindustrial Corporation Limited is to inject US$26 million into the cocoa industry within the next 3-years. Last month a total of GH¢ 4.5 million was paid to 46,000 farmers for the supply of sustainable cocoa during H1 2013/2014 cocoa season which translates into a premium of GH¢10.00 per bag. A durbar was also held on the theme: ‘Tray Fermentation; Sustaining the Quality in Cocoa Production’ - an improved method of fermenting cocoa beans that the farmers are being encouraged to adopt.

Over the past 5-years, the company through a partnership with Ghana Cocoa Board and chocolate manufacturers through Source Trust have invested over US$5m in farm improvement and rural livelihood projects across producing regions. Projects include provision of nurseries which supply hybrid seedlings as well input on credit to farmers through Commodity Management Services [CMS] a division of Armajaro*. One of the latest innovations is farm mapping and bar-coding system which is aimed at helping farmers to make informed decisions about the management of their farms.

*Armajaro has recently been acquired by ECOM Agroindustrial Corporation Limited. Source Trust, created by Armajaro Trading Limited, London, is a nonprofit organisation that aims to improve farmer yields through the delivery of projects that develop farmer business knowledge and skills.

[Ghanaweb 30/06/14]

Cocoa Farmers To Get Support From DutchThe Netherlands Government has pledged to support local producers to stimulate growth in the country’s cocoa sector. Foreign Direct Investment [FDI] will see cocoa output increase from 400MT/ha to 1000MT/ha annually. The trade mission, comprising 50 Dutch companies, is to showcase how to revitalize the Ghanaian cocoa sector by supporting local cocoa farmers. A project geared towards equipping cocoa farmers with the requisite skills across the country had been launched. Netherlands is the 5th largest trading partner of Ghana.

[Spyghana 03/07/14]

COCOBOD To Provide Free FertilizerCocobod is to introduce a free fertilizer initiative and will aid farmers in its application and utilization to ensure maximum yield. Meanwhile the annual Cocobod finance facility syndication meeting was held in London on 27th June to meet bankers as part of the process before a signing ceremony in September for the US$1.6 billion trade finance facility they intend to raise.

Ghana is confident of crossing the 2013-2014 projection of 800,000 MT to over 950,000 MT in this season. With good rain and the pilot fertilizer programme Cocobod is positive of increase in tonnage from the main and light crop seasons. Meanwhile the US$200million raised in March 2012 to support yield improvements programmes, quality assurance and warehouse expansion projects is currently being serviced and payment is expected to be completed in June 2015.

[Ghanaweb 04/07/14]

Forum Advocates Measures To Increase Cocoa ProductionThe Forum for Accountability and Development of Sefwi [FADOS], a pressure group, has echoed the need for the government to maximize cocoa production for economic growth citing the failure to pay famers’ bonuses, high import taxes on cocoa inputs and withdrawal of farming incentives. A low producer price compared to neighbouring countries is also a problem facing farmers. The Sefwi area accounts for 50% of cocoa production in the country.

[Ghana Web 14/07/14]

13

COMMODITY NEWSCOCOA

NigeriaCocoa Shipments Halted In Southeast Over Tax DisputeNigerian cocoa exporters in the southeastern trading town of Ikom suspended shipments after a dispute with the government over export levies. Exporters in the area want the Cross River state government to end a 5,000 naira levy per metric ton charged for shipment of the chocolate ingredient. A similar levy is also charged by the federal government. As much as 1,000 tons of cocoa graded and bagged for export hasn’t been shipped due to the dispute. The Cross River region produces from 60,000-75,000 tons of cocoa annually, making it the most important growing region after the southwestern region around the town of Akure, which accounts for the bulk of the country’s output, estimated at 300,000 tons in the 2013-2014 season.


Cocoa Mid-Crop Signalling More ProductionNigeria’s cocoa mid-crop is taking longer to complete and boosting prospects for production from the world’s 4th-largest grower of the beans. The smaller of 2-annual harvests is still progressing with few signs of damage from disease or bad weather. The mid-crop usually ends in June with the larger main crop starting in October. Nigeria’s production for 2013-14 will grow to 300,000 MT from 295,000 MT a year earlier, according to the Cocoa Association of Nigeria, which groups farmers, traders and processors. Cocoa exports in May jumped 38% to 4,461 MT from the previous month as favourable weather bolstered crop performance. The mid-crop will climb to 66,000 MT from 35,000 MT. Rain is forecast for this month in cocoa growing areas followed by less moisture and sun in August that will benefit drying bean.


Daily Spot Price [ICCO]These are the average of the quotations of the nearest three active futures trading months on NYSE Liffe Futures and Options and ICE Futures US at the time of London close.

Date ICCO daily price(SDRs/tonne)

ICCO daily price(US$/tonne)

London futures(£ sterling/tonne)

New York futures(US$/tonne)

1 Jul 14 2067.71 3201.59 1920.00 3117.67

2 Jul 14 2070.66 3204.82 1916.33 3126.67

3 Jul 14 2060.57 3186.62 1910.33 3103.33

4 Jul 14 2056.65 3180.57 1905.67 3096.83

7 Jul 14 2055.97 3174.18 1906.00 3090.33

8 Jul 14 2069.76 3195.70 1914.67 3118.67

9 Jul 14 2048.28 3164.13 1896.67 3085.33

10 Jul 14 2048.68 3165.70 1898.00 3087.33

11 Jul 14 2053.36 3172.65 1907.67 3089.00

14 Jul 14 2046.25 3162.50 1903.67 3079.33

15 Jul 14 2059.50 3182.08 1908.33 3099.00

16 Jul 14 2043.43 3150.09 1892.33 3065.33

17 Jul 14 2040.31 3144.91 1895.00 3055.33

18 Jul 14 2054.41 3166.13 1909.00 3080.00

21 Jul 14 2072.90 3194.34 1923.67 3112.67

22 Jul 14 2078.00 3197.81 1931.00 3108.00

23 Jul 14 2102.10 3234.01 1947.00 3156.67

24 Jul 14 2100.24 3229.91 1949.67 3155.33

25 Jul 14 2105.27 3234.54 1953.67 3159.67

28 Jul 14 2095.39 3218.15 1939.33 3147.67

29 Jul 14 2103.72 3229.70 1952.00 3158.67

30 Jul 14 2123.46 3255.65 1974.33 3180.00

31 Jul 14 2130.95 3263.15 1984.67 3181.33

14

KenyaTop Grade Coffee Price FlatThe top price of the benchmark Kenyan coffee grade was unchanged at US$340/50 kg bag at the latest auction from the level at the sale last month at the Nairobi Coffee Exchange [NCE].

July 15 June 17

AA COF-AA-KE $184-$340 $177-$340

AB COF-AB-KE $170-$258 $106-$268

Bags Offered 8,879 bags -

Average price per bag $152.65 -

[Reuters 15/07/14]

TanzaniaGrowers Urged to Work CollectivelyCoffee farmers have been advised to collect their bags into single big lots to avoid contributing more in terms of samples for tasting at the Moshi auction market. Tanzania Coffee Board [TCB] noted scientifically, 300g of beans are collected from every lot for the purpose of tasting and arbitration. Smallholder farmers who normally have between 4-6 bags of coffee complain against the burden of 300gm per lot due to their small amounts of beans. Beans collected for tasting are a loss. Meanwhile the TCB anticipates a price rise as a 50kg bag of coffee which sold for US$125 last season will likely increase to US$250 this season.

[Tanzania Daily News 15/07/14]

GRADE July 15th [$] Average Price [$] June [$]

AA 184-340 292.83 177-340

AB 170-258 230.90 106-268

C 158-228 200.89 94-243

PB 160-244 222.51 120-269

T 70-191 125.33 52-190

TT 162-213 193.96 111-223

15

COMMODITY NEWSCOFFEE

UgandaCoffee Exports Down 27% Yr/Yr In JuneUganda exported 264,611 60-kg bags of coffee in June, down 27% from a year earlier according to regulator Uganda Coffee Development Authority [UCDA]. Coffee exports earned US$32.8 million, down from US$42.7 million in June 2013. The National Union of Coffee Agribusinesses and Farm Enterprises [NUCAFE] blamed drought which had affected the crop in western Uganda during flowering and bean formation. Uganda’s coffee exports in the first 9-months of the coffee year 2013/14, which runs October to September, totaled 2.7 million bags, up from 2.6 million exported in the same period a year earlier.

[Reuters 23/07/14]

Abi Group/Opportunity Bank Boost Coffee OutputThe Agricultural Business Initiative [aBi] group has partnered with Opportunity Bank to boost 3,000 coffee farmers in Mubende, Mityana and Masaka districts with a project worth Shs 1.4bn. Through their umbrella body, Uganda Coffee Farmers Alliance [UCFA], the farmers considered in the pilot phase of the partnership are set to access financial services, including loans and digital market information.

A mobile money platform is to be created, through which loans will be disbursed to the farmers. Farmers will use the same channel on their mobile phones to access vital market information and for servicing the loans. This will work among producer organisations [POs] comprising of 20 to 30 farmers, depot committees, and coffee companies to boost production and quality standards of coffee. ABi group has offered a grant of Shs 830 million for the project, expected to increase coffee production and improve farmer skills in agriculture practices. Opportunity bank, would contribute Shs 600 million towards delivering the financial services to UCFA. Coffee remains one of Uganda’s main export commodities, but the cash crop’s exports, worth 3.15 million tonnes in 2011, declined by 13.4% in 2012.

[The Observer 01/07/14]

EPRC Push Ugandan Government To Aid Coffee Industry Proposals were put forward by the Kampala-based Economic Policy Research Centre [EPRC] to improve coffee production in northern regions as part of a wider reaching initiative to reduce poverty. According to their study if production was intensified the area would attract investors. Findings were presented to the State during a Forum on Agriculture and Food Security.

[World Coffee Press 09/07/14]

16

GeneralLongest Run of Weekly Declines In 55 YearsCotton extended the longest slump in more than 5-decades on mounting signs that global demand will trail output, increasing the chance of lower costs for companies. On ICE Futures U.S. in New York, the price tumbled 3.5% in Week 30, the 12th straight drop and the longest decline since July 1959, when Bloomberg data starts.

This year, cotton has tumbled 23%, the most among 22 raw materials in the Bloomberg Commodity Spot Index, on concern that harvests will exceed use for a 5th straight year. The International Monetary Fund [IMF] cut its outlook for 2014 global economic growth as expansions weaken from China and the U.S. Meanwhile global inventories will increase 5.1% from 2014-15. American farmers may collect 16.5 million bales, up from 12.91 million a year earlier, as a receding drought in Texas, the top producing state, boost prospects.


Cote d’Ivoire

Ivory Coast To Boost Cotton Output To 600,000tIvory Coast is aiming to boost its seed cotton output to 600,000 tonnes in the next 2-years. The country was one of West Africa’s major cotton exporters, with an annual output of about 400,000 tonnes, before a 2002-2003 civil war split the country and halved production. Output has been growing over the past 5-years thanks to government and donor efforts. Output reached 400,000 tonnes this season according to state regulator the Cotton and Cashew Council - the highest output since the beginning of the crisis and showing that the sector is rebounding. The Council is forecasting production of 420,000 tonnes for the coming season. The government is aiming for 600,000 tonnes within 2-years and has earmarked US$14.50 million to subsidise inputs for farmers and should guarantee the farmer price to match if not exceed last year’s level of 250 CFA F/kg.

[Reuters 26/06/14]

17

COMMODITY NEWSCOTTON, TEXTILES & LEATHER GOODS

DRCCotton RevivalDemocratic Republic of Congo’s [DRC] Orientale Province, which lies in the northeast of the country, has created Agricultural Society Bas Uele [SABU] to revive cotton production in the province. The new organization would acquire the Northern Development Company [CODENORD], which produces cotton for the textile company Kisangani [SOTEXKI], according to Armand Kasumbu Mbaya, provincial Minister of Planning and Investment. Subsequently SABU can attract investors who can assist in revival of cotton farming in Lower Uele. Orientale provincial authorities are lobbying for markets.

[Ecofin 22/07/14]

MaliMali Sets 2014-15 Cotton Production Target At 600,000t

Mali has set cotton production target of 600,000 tons for 2014-15, much higher than the 440,000 tons produced in the last season. Cotton sowing is already complete on 570,300 hectares or 97% of the planned area for cotton production in 2014-15, according to the Malian Company for the Development of Textiles [CMDT]. The close of the sowing season is normally July 20.

To boost the development of the country’s agricultural sector, including cotton, the President has allocated 15% of the national budget for investment. Also US$80 million would be used for providing subsidy on fertilizers. Cotton growing is also impacted by poor soil.

In its effort to address the problem, the Government is developing a soil fertility map and is also correcting soil acidification, which needs large investment. Another challenge is value-addition. At present, only 1-2% of the cotton grown is processed locally, and the remainder is exported. The Government created CMDT in 1974 to oversee the production and marketing of Mali’s cotton. It is based in Bamako and has several production sites throughout the country, in particular at Koutiala and Fana. Meanwhile prices have fallen by around 33% since early May.

[Fibre2fashion 19/07/14]

RwandaRwanda, China Sign US$10 Million Textile DealRwanda could start exporting textile garments to Europe and USA following a new trade deal between government and C&H Garments Company, a Chinese based manufacturing company. Under the Memorandum of understanding [MoU], the company will set up a garments manufacturing plant worth US$10 million at the Kigali Special Economic Zone. Government will fund 50% of the cost of the training programs while the investor will provide the equipment’s and any other expertise. The factory should be fully operational and ready to export in the next 18-months.

[New Times 14/07/14]

SenegalSodefitex To Achieve 85% ProductionLa Société de développement des fibres textiles (Sodefitex) Corporation will fall short of its 33,000 hectares production target this year due to the weather. The rainy season has made conditions difficult with only 11% of early seedlings planted. A good campaign aims for a rate of 30-40%. However an 85% production objectives should be reached. Sodefitex has also announced its intention to diversify its business by 2020.

[Ecofin 27/07/14]

18

ZimbabweUnited Refineries To Raise Cooking Oil Output From Cotton SeedsUnited Refineries Ltd [URL], a Bulawayo based agro processor is set to raise cooking oil output due to improved availability of cotton seed while it intends to resume stock feed production. The company wants to increase capacity utilisation of its main edible oil plant to between 80-90% this quarter from around 70% due to improved availability of the key raw material. Cotton seed and soya bean are primarily processed into cooking oil and the protein-rich seed cake. The cake, a by-product of the oil extraction process, is an important protein source for livestock, particularly in the poultry and piggery sub-sectors.

URL is the country’s 2nd largest cooking oil firm and can process 8,000 tonnes of oil seeds per month. There has been an improvement in cotton seed supplies since the beginning of the cotton selling season last month and will enable URL to utilise idle capacity. URL will expand into cake production. The cotton marketing season started last month and the crop is being sold at 385 buying points across the country. At least 16 buyers are registered to buy the crop this season. About 8.5 million kg of cotton have been sold since the beginning of the marketing season. Cotton output for this season is projected to rise to about 190 million kg from 145 million in 2012 /2013 season, according to the Cotton Growers Association.

Last year, Grindrod Trading, a South African company acquired a majority stake in URL which resulted in the injection of capital to boost capacity. Grindrod Trading is a subsidiary of Grindrod Limited, a JSE-listed South African-based holding company involved in the movement of cargo by road, rail, sea and air. Under the transaction, GT is arranging lines of credit for URL to boost capacity. This is in addition to a commercial contract signed for the supply of the raw materials. At least US$10 million is required to boost the capacity of the business.

[Herald 17/07/14]

19

COMMODITY NEWSCOTTON, TEXTILES & LEATHER GOODS

Mozambique Investors Interested In Tuna Fishing Investors have shown interest in setting up in Nampula province to focus on tuna fishing for export. According to the National Fishing Administration 15 tuna fishing projects are mooted with investors from Indonesia, China, South Korea and Portugal. Tuna is found along the entire Indian Ocean coastline but is most abundant in the districts of Memba, Nacala-Porto, Nacala-a-Velha, Ilha de Moçambique and Angoche. Processing and marketing companies had also visited the province and contacted the Administration. So far regional investments in the sector is estimated at around US$10 million by companies from China and Portugal to catch shrimp, lobster and grouper for export, as well as for construction of fishing vessels for development of semi-industrial fishing processes.

[Macauhub 02/07/14]

21

COMMODITY NEWSFISH

RegionalSouthern African States / EU Sign Trade PactNegotiators for Southern African states have agreed a new trade pact with the European Union which will give the countries a bigger market for food exports. The Economic Partnership Agreement, which has been in the pipeline for a decade, comes in time to beat an October 1 deadline which would have seen Botswana, Namibia and Swaziland lose preferential EU access for their beef, fish and sugar. If ratified by the governments involved, the deal will allow South Africa to export 110 million litres of wine, 150,000 tonnes of sugar and 80,000 tonnes of ethanol duty free to the EU, among other concessions. There is also improved access for export of flowers, some dairy, fruit and fruit products.

[Reuters 18/07/14]

22

COMMODITY NEWSFOODSTUFFS

KenyaDanone Buys 40% Stake In Kenya’s BrooksideFrench food group Danone is buying a 40% stake in Brookside, East Africa’s top dairy producer, as part of plans to expand in new markets amid weak growth in Europe and a slowing economy in China. The deal, whose financial terms were not disclosed, was sealed with the controlling Kenyatta family, and will boost Danone’s earnings.

Africa has in recent years become a major area of expansion for Danone and other global consumer companies such as Unilever, Nestle, Pernod Ricard and Diageo, attracted by the spending power of the growing middle class.

The deal with Brookside, which had 2013 sales of US$175.8 million and has a share of about 40% of the Kenyan dairy market, gives Danone access to the largest milk collection network in East Africa with over 140,000 farmers and a distribution network of more than 200,000 outlets. Founded in 1993 in Kenya, Brookside, which also exports to Uganda and Tanzania, has a portfolio spanning from fresh to powdered milk, yoghurt and butter.

[Reuters 18/07/14]

Kenya Importing 200,000 Tonnes of Maize From TanzaniaThe government has procured 200,000 MT of maize from Tanzania in a bid to lower maize prices which have rocketed in recent months.

The government agreed to sell 50,000 MT from the National Food Reserve Agency at a cost of Sh2,650/90 kg bag and delivered at a cost of Sh300/bag. The maize will be delivered in mid-August with the remainder supplied on availability. The National Cereals and Produce Board [NCPB] will offer storage facilities. National maize stocks as at May 21, 2014 stood at 8.8 million bags with farmers holding about 4 million bags; traders 1.1 million bags, millers 325,000 bags and NCPB having 3.03 million bags.

This comes as Kenya’s economy suffers constrained growth owing to erratic weather patterns that resulted in depressed agricultural output in Q1 2014. Agriculture and forestry grew by 2.7% in Q1 2014 compared to a growth of 6.8% over a similar period in 2013.

Data from the Kenya National Bureau of Statistics [KNBS] noted a kilogram of green maize went up by 5.2% to Sh48. 97 from Sh46.54 in May while a 2kg packet of maize flour 1.8% to Sh121.98 from Sh119.83 in May. A 2kg packet of wheat flour went up by 2% to Sh144.06 from Sh119.83 in May while a kilo of tomatoes went down by 8.9% to Sh93.80 from Sh103.

[Capital FM 03/07/14]

MalawiUS$15 Million Investment In Malawi MangoesThe Dutch development bank, FMO, the IFC, a member of the World Bank Group, and the Private Sector Window of the Global Agriculture and the Food Security Program [GAFSP] will each invest US$5 million in Malawi Mangoes to support expansion of its tropical fruit production and processing operations.

On final certification, expected in the coming months, Malawi Mangoes will be the first ever banana plantation in Africa to receive Rainforest Alliance accreditation and the first mango plantation in the World to receive this accreditation. The organization plans to scale up operations and exports to include an expanded nursery, a new 1,200 ha plantation, an expanded ripening chamber capacity and a second processing line at the processing facility.

[World Stage Group 02/07/14]

23


MoroccoPlan Maroc Vert [PMV] The EU has granted €60 million for the realization of the 2nd pillar of Plan Maroc Vert [PMV] – a 4 year plan to strengthen several production sectors in the target regions - olives, dates, almonds, red meat - with focus on Meknes-Tafilalet, Fès-Boulemane, the Oriental and the Souss Massa Draa.

[Ecofin 20/07/14]

MozambiqueVietnam Funds Assessment Of Mozambique’s Real Agricultural PotentialVietnam has decided to donate US$2 million to Mozambique to evaluate Mozambique’s real potential for food crop production. The funds will cover a 3-year program to support agriculture and aquaculture as well as transport.

[Macauhub 02/07/14]

Rice Production In Mozambique Expected To Fall In 2014Production of paddy rice [husked rice] in Mozambique in 2014 is expected to fall to 343,000 tons, a drop of 2.3% compared to production of 351,000 tons in 2013, according to the United Nations Food and Agricultural Organisation [FAO]. According to the FAO the average retail price for rice in Mozambique in June was similar to May – 25,000 meticals [US$800] per ton – but fell by 19% against the average price of 30.740 meticals [US$1,030] recorded a year before. Production is expected to total 351,000 tons in the 12-month period between May 2014 and April 2015 and Mozambique will have to import an estimated 703,000 tons to meet domestic demand.

[Macauhub 11/07/14]

NigeriaOlam To Invest US$100 Million In Commercial Rice ProductionSingapore-headquartered Olam International Limited is to scale up investment in the production of commercial rice by US$100 million [N15.7 billion].

Olam recently commissioned an integrated rice mill by President Goodluck Jonathan and disclosed plans to increase their acreage to 10,000-ha bringing its total investment to over N18 billion [US$111 million].

With 3000-ha already under cultivation and a further 3,000-ha on target for 2015, the farm is expected to yield 10MT/ha, over 2-yearly crop cycles based on 4-varieties of high-yield rice. Olam urged government to use its rice model to kick-start domestic production so to unlock opportunities for businesses and reduce the 1.9 million tonnes of rice Nigeria imports yearly.

Over 3-million Nigerian farmers now use improved seedlings, following the introduction of new rice varieties of Faro 42 and Faro 52. And the government is rapidly expanding Nigeria’s rice mills with an average growth rate of 25-40% to close the rice quality gap.

[The Guardian 16/07/14]

24

South AfricaChicken Imports ‘Stockpiled To Avoid Duty’Chicken meat stocks are above comfortable levels due to a ramp-up of imports ahead of preliminary antidumping duties being imposed on some of South Africa’s European trading partners. Astral Foods noted in anticipation of possible antidumping tariff, importers had bought huge amounts of stock, so imports have been soaring over the past 3-months. Excess stock would take some time to be absorbed. Earlier this month, preliminary antidumping duties ranging from 22% to 73% were imposed on imports of frozen bone-in chicken from Germany, the Netherlands and the UK. This followed import duties against producers and importers from Brazil being raised last year.

Astral’s new R200m feed mill in Standerton - the largest feed mill in Africa - has been inaugurated. The mill is in a ramp-up phase and will produce 28,000 tonnes of feed monthly by October. It has the capacity to produce 40,000 tonnes a month and was built to replace a 10-year feed supply agreement with Afgri, which ended this year. It is Astral’s 7th mill in South Africa and forms part of its “low-cost poultry producer strategy”, given that feed accounts for 66% of the total cost of producing broilers. With a number of poultry producers having gone bankrupt, the poultry sector was “being decimated” and the government has had to intervene to protect jobs. The government has invested more than R1bn in the agroprocessing sector over the past 5-years. While the government had assisted in levelling the trade playing field, it was also making investments to make the sector more competitive, including in Astral’s feed mill.

[BD Live 21/07/14]

25


UgandaFOCUS: Earning Big From Organic AgricultureUganda has one of the fastest growing organic certified lands in Africa. The products grown organically and sourced from Uganda include cotton [lint, yarn and finished garments], coffee [Arabic and Robusta], sesame [simsim], dried fruit [pineapples, apple bananas, mangoes, jack-fruit], fresh fruits [pineapple, apple bananas, passion fruits, avocadoes, papaya [pawpaw], ginger], jack-fruit, vanilla, cocoa, fish, shea butter and shea nuts, bird eyed chillies, dried hibiscus, honey and bark cloth. These products are exported to Europe, USA, Asia and other parts of Africa among others. The numbers of organic exporters in Uganda has been growing and are fully certified or in conversion, from internationally accredited certifying bodies operating in Uganda. Currently, Uganda has over 400,000 internationally certified organic farmers, the first and second largest certified farmers in Africa and world over respectively. The highest number is found in India.

Uganda had the world’s 13th-largest land area under organic agriculture production and the most in Africa. By 2013, Uganda had around 350,000 ha of land under organic farming covering more than 2% of agricultural land. There are 44 certified export companies. The demand for organic products from Uganda is high at about US$600 million. Uganda uses among the world’s lowest amount of artificial fertilizers, at less than 2% [or 1kg/ha] of the already very low continent-wide average of 9kg/ha in Sub Saharan Africa. The widespread lack of fertilizer use has been harnessed as a real opportunity to pursue organic forms of agricultural production, a policy direction widely embraced by Uganda.

According to International Federation of Agriculture Movement [IFOAM], the global market for organic foods and drinks is estimated to be around US$50 billion, and increases by 10-20% annually. This sub-sector provides a unique export opportunity for many developing countries, owing to the fact that 97% of the revenues are generated in the Organization for Economic Co-operation and Development [OCED] countries, while 80 per cent of the producers are found in developing countries of Africa, Asia and Latin America.

As a significant producer of organic products, Uganda benefits from an important source of export earnings and revenue for farmers. In terms of price premiums and income for farmers, the farm-gate prices of organic pineapple, ginger and vanilla are 300%, 185%, and 150% higher, respectively than conventional products. Uganda has taken an apparent liability – limited access to chemical inputs – and turned this into a comparative advantage by growing its organic agriculture base, generating revenue and income for smallholder farmers.

[Fresh Plaza 21/07/14]

ZimbabweCorn Production Increases 82% To 1.46 Million TonsThe maize harvest has increased by 82% up 1.46 million tonnes enabling the country to meet local consumption for the first time since 2003. Favourable rainfall and Government policy to provide free seeds and fertilizers to farmers are the main factors that contributed to this performance. Meanwhile the World Food Program [WFP] had suspended its assistance to Zimbabwe.

[Ecofin 17/07/14]

27


GhanaSolidaridad Launches West Africa Oil Palm InitiativeSolidaridad’s Sustainable West Africa Palm Oil Programme [SWAPP], launched its incubator and Access to Finance initiative in Accra, to provide support and access to risk capital to help develop the oil palm sector. The 2-year SWAPP and Access to Finance is a component of the regional programme being implemented by Solidaridad West Africa, a-not-for-profit organisation, and supported by funding from the Dutch government to accelerate the development of a larger and more productive oil palm sector. The industry faces financial challenges as well as a lack of best practices and knowledge exchange. Ghana is a net importer of 70,000 tonnes of oil palm annually to supplement limited domestic supply.

[Ghanaweb 26/06/14]

28

COMMODITY NEWSPALM & COOKING OIL

GeneralGlobal Rubber Conference 2014 Recognised to be one of world’s leading conferences on natural rubber, Sri Lanka has been selected to host the Global Rubber Conference [GRC] 2014, a 3-day international event from 27-30th October in Colombo. Co-organised by the Sri Lanka Export Development Board [SLEBD] and CONFEXHUB, GRC 2014 is supported by the International Rubber Research Development Board [IRRDB] and over 20 global government agencies and associations. The event will bring together 700 experts and delegates of whom 500 will be foreign delegates representing over 25 countries. Last year the event was hosted in Palembang, Indonesia Themed ‘Sowing the Seeds for Sustainable Future’, the high calibre forum is expected to serve as a platform for various industry players in the rubber industry to gain further insights on the major challenges and opportunities within the industry, both in a local and global context.

[News LK 28/07/14]

29

COMMODITY NEWSRUBBER

CameroonJustin Sugar Mills Batouri ProjectCameroon has terminated a Memorandum of Understanding [MoU] with Indo-Cameroonian company, Justin Sugar Mills, for the establishment of a sugar complex in Batouri. Government is to launch an appeal to investors for CFA 60 billion francs. The project hopes to establish a plant with a capacity of initial production of 60,000 tonnes per year.

[Ecofin 28/07/14]

KenyaH1 Raw Sugar Output Rises 20% On Improved Cane Supply

Kenya’s raw sugar production jumped 20% in H1 2014, aided by improved supply of cane and factory capacity. Kenya has an annual sugar deficit of around 200,000 tonnes, which is usually filled by imports from other producers in the Common Market for Eastern and Southern Africa [COMESA]. Kenya is struggling to improve output due to relatively high production costs and poorly funded sugar factories. The total sugar production between January and June 2014 was 321,945 tonnes compared to 267,915 tonnes in the same period last year. The Kenyan Sugar Board [KSB] has crushed 3.52 million tonnes of cane over 6-months to June compared to 3.11 million in the same period of 2013 attributed to improved cane availability as a result of expansion in area under cane in most sugar zones.

Improved prices of cane, expanded factory capacity and timely payment to farmers has spurred interest in cane development. Raw sugar production for 2014 is expected to climb by 7% to 640,614 tonnes compared to 600,179 tonnes realised in 2013. KSB previously projected the country’s 2014 raw sugar production to climb 17% to 700,000 tonnes. Kenya has an installed factory crushing capacity of 30,109 tonnes of cane per day and expects an additional 3,000 tonnes to be added when a factory being constructed near the port city of Mombasa starts operations. The factory - Kwale International Sugar Company - is 25% owned by Mauritius’ Omnicane. Kenya plans to sell a 51% stake in 5-sugar millers to strategic investors starting this month as it looks to complete reforms aimed at making its sugar industry more competitive.

The regulator estimated the cost of producing a tonne of sugar at about US$570 in western Kenya compared with US$240-$290 in rival producers such as Egypt. In February Kenya was granted a 1-year extension of safeguards that limit sugar imports from COMESA to allow the country to improve the competitiveness of its sugar industry. The tariffs were scheduled to fall to zero in March, but Kenya sought an extension until 2015 to conclude reforms in its sugar industry. Meanwhile improved surveillance has helped curb illegal importation of sugar into the country that threatens the cash flow of millers. Total sugar sales in January to June 2014 were 325,812 tonnes against 254,091 tonnes in a similar period 2013.

[Reuters 17/07/14]

ALTEO To Take Control Of The Kenyan TSCL Sugar CompanyALTEO Limited’s subsidiary company, Sucrière des Mascareignes Limited [SML], has signed an agreement for the acquisition of 51% of Transmara Sugar Company Limited [TSCL], a Kenyan company operating a sugar mill in the Transmara region. The milling capacity of TSCL is above 400,000 tonnes of sugar cane over a 300-day crop, with a potential to increase to over 1-million tonnes within the next 3-years. The proposed acquisition by SML is expected to be completed within the next 3-months upon satisfactory completion of a due diligence by SML. ALTEO’s core activities span sugar cane growing, sugar milling and energy production.

[Alteo 22/07/14]

30

COMMODITY NEWSSUGAR

SwazilandProduction Expected To Increase Post EPAFollowing conclusion of the Economic Partnership Agreement [EPA] between the European Union [EU] and Southern African Development Community [SADC] member states, the local sugar industry expects to increase its production in the next 5-years. [If the EPA was not initialled Swaziland would not have been able to export its sugar to the EU post-September 2014 and would have been forced to store the sugar in warehouses taking out payment loans and wait for the conclusion.] The initialling of the EPA means a lot to the industry in terms of net proceeds payable to millers and growers. Exports to the EU currently account for about 8% of total EU imports.

The main features of the EPA with the SADC EPA Group - South Africa, Namibia, Botswana, Lesotho, Swaziland, Angola and Mozambique – include a goods market access deal with Botswana, Lesotho, Mozambique and Swaziland; as well as a fully-fledged development cooperation chapter. Complying with requirements of the World Trade Organisation [WTO], the EU was obliged to review its internal market. As a consequence the price of sugar paid by the EU will reduce gradually to approach world market prices.

The Swaziland Sugar Association [SSA] project production levels will increase over the next 5-years. Cane area has increased by 28% since the 2000/01 marketing year [MY], as more small-scale farmers took up sugar cane cultivation, and access to irrigation increased through significant investments by government, the EU and donor organisations. As a result, sugar cane production increased by more than 30% to reach its highest level of 5.7 million mega tonnes [MMT] in the 2012/13 MY. Expectations are that by the 2016/17 MY, the area will increase to 65 000 ha and production could be more than 6.5 MMT. Swaziland is Africa’s 4th largest producer of sugar after South Africa, Egypt and Sudan.

Last year the EU decided to maintain its internal sugar production quota until October 2017, which raised fears that this might render the market less attractive for local exporters. The 2006 EU sugar reforms had transformed the European Union from a net exporter into one of the world’s largest net importers of sugar, which all happened during a period of rising world prices. As a result, internal EU prices have fallen less than originally envisaged. ACP [African, Caribbean and Pacific] countries and Swaziland have benefited from this.

The EU envisages further sugar sector reforms covering the period 2014 to 2020 - the EU sugar market would be further aligned with world market conditions. A key question has been the abolition of the internal production quota as proposed by the European Commission. The system of internal production quota had exercised an upward pressure on internal EU prices. After consultations and negotiations, it is now likely that the production quota would be maintained until October 2017 [4-more seasons]. From October 2017, there will no longer be an internal production quota. As a result, internal EU sugar prices will be less high and therefore the market might be less attractive. However, Swaziland would continue to benefit if it concluded and initialled the EPA. To this end the conclusion of the EPA brings more certainty to EU access for Swazi sugar, which was extremely important for planning purposes. The outcome of the finalised EPA will allow South Africa more access for its agricultural goods into the EU. South Africa would have more access for its agricultural goods because it was restricted under the Trade and Development Cooperation Agreement [TDCA] it concluded with the EU a few years back. In as far as the rest of the Southern African Customs Union [SACU] was concerned [including Swaziland]; the member states have been able to export their agricultural products duty-free quota-free since 2009 under a special EU regulation.

[Swazi Observer 27/07/14]

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COMMODITY NEWSSUGAR

SSA Reduces Price To Compete Against Overseas SugarThe Swaziland Sugar Association [SSA] has reduced the sugar price to ensure it remains competitive against an influx from overseas suppliers over the past 2-years mainly from Brazil and to a lesser extent India and Thailand. A continued downward pressure on the world sugar price is envisaged for the next few years, followed by a price recovery. A reason for downward pressure on sugar prices is the ability to produce ethanol from sugar.

Brazil is now on its way to becoming a major petroleum producer and has steered its domestic production towards ethanol since the 70s. This means that increasingly less of Brazil’s sugar crop will be available for export. The over-supply and de-regulation of trade would therefore bring prices off until about 2016 when demand would outstrip supply, and prices would begin to climb again. By 2020, sugar producers would need to supply another 20 million tonnes.

The influx of foreign sugar into the region is not because the Southern African Customs Union [SACU] had changed its policy towards its sugar industry. It is because the tariff on imported sugar had declined to zero due to out-dated information being used to determine the underlying Dollar-Based Reference Price [DBRP]. A new DBRP was gazetted by South Africa [on behalf of SACU] with effect from April 2014.

[Swazi Observer 27/07/14]

TanzaniaBulk Sugar Procurement Starts September / Agro Ecoenergy Project Stranded

In a bid to control excessive importation of sugar, the Sugar Board of Tanzania [SBT] will start bulk procurement next September, after establishing a separate unpaid shares company involving all stakeholders in the industry. The company is looking at an Ewura model covering fuel importation. Energy and Water Utilities Regulatory Authority [EWURA] introduced bulk procurement of petroleum products over 3-years ago after establishing Petroleum Importation Coordinator Limited a company involved in tendering and choosing a winning bidder to import fuel on a monthly basis.

The industry has seen local producers bear the brunt of cheap imported sugar from Brazil, India and Thailand. With bulk procurement, SBT hopes to control the importation of sugar but also ensure that the right amounts are imported during the low season when the industry is not producing. Enforcement agencies are also working to ensure that smuggled sugar is not allowed in the domestic market. Tanzania’s domestic sugar producers can only manage over 350,000 tonnes of the commodity against demand which stands at over 480,000 tonnes. Sugar imports have often caused complaints from domestic producers some of whom have frozen plans for expansion because of excess sugar in the market.

With bulk procurement, SBT hopes to increase government revenue and check against prices as only one importer will be chosen to order the commodity. A giant sugar project in Bagamoyo by Agro Ecoenergy Tanzania is stranded because investors and development banks are worried by influx of cheap imported sugar from Asia. Apart from land security, investors want to see improved policy on taxation to suit giant project financiers. The Agro EcoEnergy project is the first new integrated sugar project in Tanzania since 1974. Under Southern Agriculture Growth Corridor of Tanzania, the project is expected to is expected to produce about 130,000 tonnes of sugar, 10 million litres of ethanol and 100,000 mw hour capable of supplying 100,000 rural households. Agro EcoEnergy Tanzania Ltd is seeking land to establish a modern sugarcane plantation and build a factory for producing sugar, ethanol and power. In response, the government has piloted a cooperation framework that balances the interests of all stakeholders, striking a win-win deal whereby local communities will receive a 10% nondilutable shareholding in the project company Bagamoyo EcoEnergy Ltd.


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UgandaSugar Exports Curbed By Regional Trade BarriersUgandan sugar processors are holding 50,000 MT of unsold stock as exporters face obstacles in East African markets ranging from wars to duties according to the Uganda Sugar Manufacturers Association [USMA]. USMA noted this is affecting expansion programs. Efforts to market sugar in Rwanda are hampered by the abundance of cheaper imports from outside East Africa, while exporters to Kenya face barriers such as duties and red tape. Conflicts in South Sudan and eastern Democratic Republic of Congo [DRC] have also curbed the trade. Uganda is set to produce a surplus of sugar this year. Production may climb to 442,500 tons from 334,040 tons last year. Domestic demand is about 320,000 tons annually. Uganda usually imports sugar from India and Brazil and exports to nations that border it: Rwanda, Kenya, South Sudan and Congo. Uganda belongs to the 5-nation East African Community common market, which includes Kenya, Tanzania, Rwanda and Burundi. The EAC this year gave Rwanda a 6-month extension to import duty-free sugar from outside the region to address supply shortages.

[Business Week 14/07/14]

ZimbabweZimbabwe to Host SADC Sugar Producers’ ConferenceThe Zimbabwe Sugar Association hosted the Annual Conference of the Federation of SADC Sugar Producers [FSSP] on July 23. The conference was held back to back with the SADC Technical Committee on Sugar meetings. The theme of this year’s conference is “Developing the SADC Sugar Industries through empowerment programmes and sustainable private farming.” SADC countries produce 5 million tonnes of sugar p.a. about 3% of the world’s total production. SADC Sugar Industries export 2 million tonnes equivalent of 40% of total production in SADC. Many SADC Industries have potential to increase production.

[The Herald 15/07/14]

Factbox: Federation of SADC Sugar Producers [FSSP] - The FSSP was launched in November 2000 in accordance with the Sugar

Cooperation Agreement - Annex VII - SADC Protocol on Trade - Provide a forum for discussion and to foster specific programmes of common

interest among members - Includes sugar associations and other bodies representing the sugar industry in

each SADC member states - The Federation meets annually and includes both growers and millers from the SADC sugar producing region - Promotes the common interests of the sugar industries within SADC in close cooperation with the Technical Committee

on Sugar [TCS] - One of the major TCS achievements is the compilation of the SADC Regional Sugar Strategy which was approved by the

SADC Committee of Ministers of Trade in July 2008.

Latest issue of the ‘SADC Sugar Magazine’ 2014http://sadcsugardigest.com/digest_flip_book/

33

COMMODITY NEWSSUGAR

BurundiBurundi Q1 Tea Revenue Down On Higher Kenya OutputBurundi’s tea export earnings fell 8% in Q1 2014 from a year ago, due partly to a higher production from neighbouring Kenya, the biggest regional producer of black tea. State-run tea board [OTB] said it has collected US$5.40 million between January and March from the export of 2,306,702 kg, down from US$5.88 million earned the same period in 2013 from the sale of 1,984,806 kg. Kenya influences the regional market as the biggest East African economy alone produces 80% of the commodity in the region. Burundi exports 80% through a regional weekly auction held in Mombasa. The average export price per kg for Burundi’s tea dipped US$2.34 from US$2.97. Revenue from the commodity dropped to US$20.8 million in 2013 from US$26.3 million in 2012, depending on a weaker world market.

[Reuters 04/07/14]

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COMMODITY NEWSTEA

KenyaSenate To Investigate Mombasa Tea Auction Over Shady DealsThe Kenyan Senate has recommended investigations into operations at the Mombasa Tea Auction following allegations of malpractices and the manipulation of tea prices. Despite defences by KTDA and East Africa Tea Traders Association [EATTA] – the body that runs the tea auction, the Committee asked the Government to put up a major probe into the operations at the market to check on possible underhand deals and to discourage dumping of low quality tea in the market and the practice of importing lower quality tea to blend with local tea.

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[Standard Digital 23/07/14]

Tea Farmers Get Sh1.5 BillionThe Kenya Tea Development Agency [KTDA] has released Sh1.5 billion mini-bonus for tea farmers. Most factories are paying Sh3 per kilo of the green leaf. However 9-factories from Bomet and Kericho regions have not resolved amounts. Tea farmers can expect better returns this year after tea prices started picking up at the Mombasa Tea auction. Kenya Tea Development Agency [KTDA] noted improved prices were a result of reduced supply occasioned by the current cold season and the fact that most farmers have pruned their tea bushes.

[The Star 30/06/14]

RwandaRwanda Tea to Coffee Earnings Fell in First 4-Months

Rwanda’s earnings from tea and coffee fell in the first 4-months on lower prices. Coffee shipments were valued at US$5.8 million from January through April, compared with US$14.2 million a year earlier.

The National Agricultural Export Development Board noted earnings from tea dropped to US$19.2 million from US$22.3 million. Prices at auctions in Mombasa, Kenya, where Rwanda sells its tea, retreated in the period compared with a year earlier. The average price for the main tea grades dropped by about 55 cents/kg since January, and prices are expected to remain at similar levels in the next few months on high production as a result of favorable rains.

Oversupply at the auction and on the world market, coupled with political instability in some tea-consuming countries, also resulted in volatility in demand. Rwanda forecasts earnings of US$68 million from tea exports of 27,000MT this year. Coffee shipments are expected to produce US$70.4 million from 23,000 tons, compared with 20,000 tons that generated US$55.2 million the previous year.


35

COMMODITY NEWSTEA

GeneralTanzania, Kenya And Uganda To Jointly Combat Illegal Timber TradeMember countries of the East African Community [EAC] will work together, along with INTERPOL and UN agencies*, to curb the illegal timber trade. High-level government representatives of Kenya, Uganda and Tanzania attended the first United Nations Environment Assemble [UNEA]. Participants recognized illegal logging must be mitigated, and forests managed sustainably, in order to reduce emissions from forest loss. As such, a key goal of the initiative is to curb illegal logging and trade in East Africa as a way to address deforestation and subsequently reduce emissions from forests. The economic costs of illegal logging are staggering. Including processing, an estimated US$30-100 billion is lost to the global economy through illegal logging every year. In addition to facing the challenges of illegal logging within their borders, Tanzania, Kenya and Uganda are also used as transit countries for timber illegally logged in other countries such as the Democratic Republic of the Congo [DRC].

The Tanzanian strategy to reduce emissions from deforestation and forest degradation [REDD+], the on-going Kenya REDD+ governance project and the Uganda REDD+ readiness plan highlight the importance of strengthening law enforcement and forest governance to address the illegal timber trade as one of the key drivers of deforestation. The East Africa Initiative on Illegal Timber Trade and REDD+ represents an innovative cross-border, multi-sectoral effort that will create a powerful deterrent to Africa’s illegal timber trade.

The government of Norway, a strong global supporter of tropical forests and those that depend on them, has announced its intended support for this collaboration. The East Africa Initiative on Illegal Timber Trade and REDD+ provides an opportunity to build on each country’s experiences combatting the illegal timber trade, and brings in the specialized expertise of INTERPOL and each collaborating UN agency. The five agencies will assist the governments of Kenya, Uganda and Tanzania to address a different facet of the illegal trade in timber: from economic drivers, and corruption, to law enforcement, customs control, and monitoring.

*Food and Agriculture Organization of the United Nations [FAO], United Nations Development Programme [UNDP], United Nations Environment Programme [UNEP], United Nations Office on Drugs and Crime [UNODC].

[Africa Science News 26/06/14]

36

COMMODITY NEWSTIMBER

CameroonCameroon Exports Face DelayCameroon log exporters are still facing delayed shipments as the port operator tries to clear the huge backlog of timber which accumulated when the port operations stopped while authorities negotiated the new contract with the port operator. Sawmills report that sawnwood shipments are back on schedule and that they have healthy order book positions. Most mills are finding it difficult to build stock levels as business with buyers for the Chinese market is very brisk and Middle East buyers are seldom absent from the market.

[ITTO 30/6/14]

DRCDRC To Freely Export Afromosia The Democratic Republic of Congo [DRC] can now export Afromosia without restriction. The Convention On International Trade In The Species Of Fauna And Flora In Danger Of Extinction [CITES] has now lifted the ceiling cap of 25,000m3 p.a. According to the Environment Minister the move is a result of efforts made by the Government in the supervision and monitoring of this market since 2007.

[Ecofin 25/07/14]

GhanaGhana’s Export Earnings FallGhana’s exported less secondary and tertiary wood products [TWPs] during the first 4-months of 2014, compared to the same period last year. During that period export earnings totaled €33.80 million from the export of 83,454 m3 of wood products, a 20% drop in volume and a nearly 8% decline in value. As a share of total exports, secondary wood products [primarily sawnwood] accounted for 83% in the first 4-months of this year as against 90% in the same period in 2013. The decline in the export of SWPs can be attributed to lower sales of sawnwood, veneer and plywood. There were also weaker sales of dowels, flooring, mouldings and furniture parts. The respective market shares of Europe, Africa and Asia were 40%, 31% and 14% with the balance to the United States, Middle East and Oceania.

[ITTO 30/06/14]

Wood Processing Set To Get More Government SupportThe Ghana office of the World Bank, in collaboration with the Ministry of Trade and Industry, recently organised a workshop to engage stakeholders on how best to harness the complexities of the technological era for the growth of the manufacturing sector in order to boost competitiveness. The Bank Country Director, Yusupha B. Crookes, commended Ghana for achieving rapid improvements in the business climate. Ghana had a good ranking in “ease of doing business” which has helped attract foreign investors. Government is to further improve the manufacturing and agricultural sectors and has identified agro-processing, pharmaceutical, plastics and wood processing for special attention. In a related development, U.S-based Frontiers Strategy Group has ranked Ghana as the 4th most preferred investment destination on the continent after Angola, Kenya and Nigeria.

[ITTO 30/06/14]

37

COMMODITY NEWSTIMBER

Guinea BissauGuinea Bissau Government Suspends Exports Of WoodThe Guinea Bissau government has provisionally suspended exports of wood in order to give priority to exports of cashew nuts, according to a decision from the council of ministers meeting in Bissau. Following the decision trucks loaded with wood started leaving the area around the port of Bissau, which was congested with vehicles carrying wood that was preventing exports of cashew nuts, Guinea Bissau’s main export product. The government’s decision will also allow ships carrying food products for the capital, which had been waiting offshore because of congestion caused by ships carrying wood, to dock.

[Macauhub 14/07/14]

MoroccoCrédit Agricole of Morocco [GCAM] Supporting Forestry Co-OperativesThe Crédit Agricole of Morocco [GCAM] is to financially assist 150 forestry cooperatives. Members will benefit from favourable and preferential terms for opening accounts and obtaining credit.

[Ecofin 17/07/14]

TanzaniaForestry Scheme Takes OffThe governments of Tanzania and Finland have jointly embarked on a 16-year forestry programme to sensitize Tanzanians to plant and treat trees as other cash crops. A Private Forestry Programme which started in the Southern Highlands early this year is set to be implemented in 4-different phases. The project, from 2014-2017, will focus on teak and pine used to produce timber for house construction. Headquartered in Njombe, the project has started in 6-districts: Njombe, Ludewa, Makete, Mufindi, Kilolo and Kilombero. 1,500 ha of land will be utilized.


ZambiaReintroduction Of Forest Rangers As Illegal Logging Threatens IndustryThe Zambian government has re-introduced forest rangers to fight against illegal timber trade that has increased in recent months. One valuable hard wood tree known locally as the mulula tree is under threat because of indiscriminate cutting. Rangers would begin patrolling all forest reserves as well as carrying out inspections to ensure that all moving timber had proper documentation. Several people, including foreigners, have in recent months been arrested for transporting timber from different parts of the country without permits and most of the consignments have been meant for export.

[Star Africa 08/07/14]

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Pan AfricaTobacco Growers Appeal For Inclusion In WHO MeetingsA body representing more than 3-million tobacco growers in the world urged a World Health Organization [WHO]-initiated treaty to engage growers when it develop policies that will impact their livelihood. The International Tobacco Growers Association [ITGA] note growers are concerned about their continued exclusion from meetings of the WHO Framework Convention on Tobacco Control [FCTC] where crucial decisions to regulate the industry are made. The FCTC is to hold a meeting in Moscow this October.

According to the WHO, tobacco kills nearly 6-million people a year. The WHO warns that unless urgent action is taken, smoking-related death toll could rise to more than 8-million a year by 2030. FCTC meetings, now with 168 signatories, are held every 2-years as countries deliberate and endorse detailed measures to finally stem tobacco consumption. Big Tobacco are usually barred from attending these meetings as FCTC signatories agree to stay away from any interference of the tobacco interests.

But tobacco is a tricky issue in countries where hundreds of thousands of peasants live on tobacco farming. They might struggle to survive if it were not tobacco as few other cash crops can be as profitable. In Africa, it is estimated that there are more than 1.3 million tobacco farmers producing more than 750 million kg of tobacco valued at US$1.3 billion. Zimbabwe, Tanzania, Malawi are the major tobacco producing countries. The ITGA is concerned tobacco is being excluded from e benefits of free trade arrangements such as zero tariffs and free market access.

The last FCTC meeting proposed to ban tobacco promotion bodies, finance and technical assistance to farmers and to decide the time and quantity of tobacco to be grown by the farmers. The ITGA had produced a 7-point declaration in which it calls for reasonable, sensible and evidence-based proposals by the FCTC to regulate the sector. Eritrea, Malawi, Mozambique, and Zimbabwe are the only non-FCTC signatories in Africa. Tobacco production in Africa was rising recent years due to increased production in Zimbabwe. Tobacco is one of the biggest foreign currency earners in Zimbabwe. It accounted for 11% of GDP in 2013, 61% of all agricultural exports and 21% of total exports. Tobacco output is expected to reach 210 million kilograms this year. The figure increased from 167 million kg in 2013 and is just slightly below the country’s record of 236 million kg. Most of Zimbabwe’s tobacco is exported, mainly to China, Belgium, South Africa, Russia, and Sudan.

[Xinhua 02/07/14]

MalawiTobacco Export Increases 36%Malawi, one of the world’s largest tobacco producers, has realised a 36% increase in tobacco exports in first half period of this year. The Tobacco Control Commission note cumulative tobacco exports in the period from January to May this year were at US$137.7 million compared to US$87 million in the corresponding period last year. Malawi is the world’s most tobacco-dependent economy with sales generating US$165 million p.a and making up 53% of its exports. Malawi is 1 of 7-countries that derive at least 1% of export earnings from tobacco. Burley leaf from Malawi makes up 6.6% of the world’s tobacco exports and accounts for over 70% of Malawi’s foreign earnings.

[Ventures Africa 08/07/14]

Malawi Earns Over US$200m In Tobacco SalesMalawi has earned over US$200million in tobacco sales with 127 million kg sold since the opening of the country’s marketing season in March. The figure is 3% below 2013 earnings. The Tobacco Control Commission [TCC] noted marketing is stable across main auction floors despite registering a reduction in sales compared to last year. As the nation heads towards the end of tobacco marketing season, prices have picked up giving hope to farmers compared to what the buyers were offering during start of the selling season. The global softening of tobacco prices has affected the prices on the national market.

[APA 14/07/14]

39

COMMODITY NEWSTOBACCO

UgandaFarmers Fighting For TobaccoThe Ugandan parliament is considering a new tobacco control bill that would put strict limits on tobacco marketing and consumption. The measure is popular with health professionals, but the tobacco industry is up in arms, with small-scale tobacco farmers saying the bill will drive them out of business. The Tobacco Control Bill is currently before parliament as a framework for regulation. Several neighboring countries have similar laws. If the bill passes it is likely to decrease demand for tobacco, which will drive down the price of the raw leaves.

[Voice of America 06/07/14]

ZambiaTobacco Harvest UpZambia’s Ministry of Agriculture and Livestock disclosed that the country expects to harvest tobacco worth more than K750 million in the 2014 season. Data from the ministry indicated that there was a projected tobacco yield of 45 million kg of burley, virginia and fire tobacco valued at more than K750 million compared to 41.4 million kg of tobacco valued at about K711.3 million which was produced in 2013.

[Post Zambia 09/07/14]

ZimbabweTobacco Sales Highest Since 2001 Tobacco farmers in Zimbabwe sold about 205.5 million kg in the marketing season that ended June 27, breaching the 200 million-kg mark for the first time since 2001. Farmers earned more than US$651.9 million from sales of mainly flue-cured or Virginia tobacco, compared with more than $569.5 million a year earlier. Tobacco is traditionally sold in Zimbabwe from late February through June. Mop-up sales, to purchase any tobacco remaining on farms, will be held July 15. Deliveries of the leaf grew 33% on the previous season, while the average price declined to US$3.17/kilogram from US$3.70 last year, according to state regulator Tobacco Industry and Marketing Board [TIMB]. TIMB had earlier predicted a crop of about 185 million kg. Tobacco is Zimbabwe’s biggest agricultural export and 2nd-biggest earner after minerals.


MTC Invests US$37 Million In InputsMashonaland Tobacco Company [MTC] has invested US$37 million in inputs given to 12,600 farmers who grew tobacco on a contract basis during the 2013 /14 agricultural season up from US$21 million. MTC is the largest single contractor of small holder tobacco farmers in Zimbabwe. The firm, which ventured into contract growing in 2004, has been operating as a leaf merchant in Zimbabwe since 1936 and supplies packed tobacco to global markets. Contract farming provided farmers with a guaranteed market of tobacco and accords traceability.

[The Herald 17/07/14]

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