FAO Food Price Index: food price posts sharpest decline since Dec

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ROME, ITALY — Prices of global agricultural food commodities declined sharply in July, led lower by steep drops in dairy and sugar, according to the Food and Agriculture Organization of the United Nations.

The FAO Food Price Index averaged 168.8 points in July, down 3.7% from June and down 3.7% from the same period a year ago.

According to the FAO, the decline marked the first significant month-on-month decline in the value of the index since December 2017, reflecting notable drops in the values of all sub-indices.

The FAO Food Price Index is a measure of the monthly change in international prices of a basket of food commodities.

The FAO Cereal Price Index averaged 160.9 points in July, down nearly 6 points, or 3.6%, from June and 1.3 points, or 0.8%, below its level in the corresponding period last year.

“The decline in July was driven by weaker export quotations for wheat, maize and rice,” the FAO noted. “International wheat prices were generally weaker during the first half of the month, but concerns over production prospects in the E.U. and the Russian Federation started to push export values higher toward the end of the month.

“In coarse grains markets, maize prices remained under general downward pressure, largely on weak demand and good production prospects in the United States. However, similar to wheat markets, maize values made solid gains toward the end of the month, on weather worries and a faster pace in export sales. International rice prices also fell, pressured by frail demand for Indica and fragrant varieties as well as currency movements in some leading exporters.”

The FAO Vegetable Oil Price Index averaged 141.9 points in July, down 4.2 points, or 2.9%, from June. The decline marked the sixth consecutive month in which the index has moved lower, and at 141.9 points it was at a two-and-a-half year low, the FAO said.

“The latest slide mostly reflects weakening values of palm oil and soy oil,” the FAO said. “International palm oil prices fell further under the influence of sluggish export demand, ample stocks held by leading producing countries, and expectations of higher production in the coming weeks. As for soy oil, the fresh drop in prices was largely driven by spill-over weakness from the soybean market and persistently high crushing rates in the United States, supported by attractive crush margins. On the other hand, rapeseed oil values trended upward, underpinned by improved demand from biodiesel producers and negative crop prospects in the E.U.”

The FAO Sugar Price Index averaged 166.7 points in July, down 6% from June and nearly 20% lower than a year ago, while the FAO Dairy Price Index averaged 199.1 points, down 6.6% from a month ago and 8% below the same period in 2017.

Source: WORLD-GRAIN.COM

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The Africa Green Revolution Forum: Agri-entrepreneurs should take full advantage

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The Africa Green Revolution Forum (AGRF) is due to take place in Kigali next month and organisers will not come empty headed.

Smart agri-business entrepreneurs might walk away from the forum with a financial windfall of between $100,000 and 5 million to invest in value addition.

Adding value to agricultural produce has been one of Rwandan farmers’ main weaknesses as many lacked the skills and the money to venture into the trade.

But going around local stands at the ongoing Rwanda International Trade Fair, things are changing. It is quite heartening to see young entrepreneurs leading the way in transforming their produce to manufacture an array of products.

Food technology is slowly picking up with many Made-in-Rwanda foodstuffs on supermarket shelves, packaging and marketing have improved tremendously but there is more room to do more.

Though local financial institutions are reluctant to finance agricultural ventures – because of unreliable weather patterns and national catastrophes – they could at least follow in AGRF’s footsteps and help fund produce transformation targeting the local and export markets.

Local agri-business persons could help allay the banks’ fears of the risk factor by taking full advantage of the AGRF opportunities.

Financial offers in agri-business do not come every day and it is an opportunity to show that value additions is one of the most lucrative part in the food chain. Maybe that will convince local financial institutions that they been holding the shorter end of the stick by failing to take a more active part in financing agri-entrepreneurs.

Source: The New Times

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INTERNET OF THINGS: Why technology will disrupt and transform our agriculture

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Agriculture is critical to some of Africa’s biggest development goals. The sector is an engine of job creation. Farming alone currently accounts for about 60 percent of total employment in sub-Saharan Africa, while the share of jobs across food system is potentially much higher.

At the same time, Africa’s agriculture sector is facing mounting challenges.

Africa’s population, which is projected to rise by 1.3 billion by 2050, will further strain her food system. This will require a 70 per cent increase in food production. Besides increasing productivity, such efforts require to be augmented by ensuring minimal food losses and efficient supply chain management.

ICT SOLUTIONS

The food security challenge will only grow as climate change intensifies, threatening crop and livestock production. If no adaptation occurs, production of maize –Africa’s main staple crop – could decline by up to 40 percent by 2050.

Expanding the land that is under cultivation has boosted African agricultural production in the past, but is has come at an environmental cost. Moving forward, the focus must be on intensifying production on agricultural land sustainably without harming the environment.

Technology in agriculture is expected to play a major role in agricultural growth in the developing world as many ICT solutions have proven affordable to small holder and resource poor farmers that make up about 80 per cent of the farming community in the region.

INTERNET OF THINGS

So clearly business-as-usual farming is not the right way forward.

Whether it is satellites that provide accurate climate data, Internet of Things – computer devices interconnection via the internet enabling them to send and receive data, devices like smartphones, or cutting-edge innovations like blockchain (a decentralised, distributed ledger used to record transactions across many computers) digital technology could be the game-changer in boosting agricultural productivity and building resilience in a sustainable way.

Various development partners and research institutions are incorporating precision technology into their agriculture projects around the world. For example, World Bank is exploring internet-enabled smart irrigation devices that combine automated soil water sensors and cloud-based data analytics which will boost crop yields while cutting water use.

DIGITAL GREEN

In Kenya, there is a pilot project on the use of big data from remote sensing and GIS-enabled technologies to support the implementation of agro-weather analytics that enable accurate weather monitoring and dissemination of climate information to smallholder farmers.

This data enables smallholder farmers to know how and when to apply inputs for optimal results. The pilot will be rolled out in October under the World Bank-funded Kenya Climate Smart Agriculture Project.

All over the Africa, startups and other institutions are leveraging digital technology in transformative ways.

In Nigeria and Kenya, Hello Tractor is reversing the trend of low mechanisation by allowing farmers to hire affordable tractors to work their land, using their mobile phones. Solar refrigerators are helping dairy farmers in Kenya cool their milk products and reduce spoilage. About1.2 million farmers in Ethiopia, Ghana, Malawi and Niger are learning best farming practices through engaging videos from Digital Green – a low cost way to deliver agriculture extension.

FOOD SAFETY

There is more in the horizon. The much-hyped block chain technology could expand rural finance by making financial transactions more accessible and less expensive and create more transparent and efficient system that allows farmers and others throughout the value chain to manage their supply chain more efficiently.

The technology can be applied directly to the grain trade and also expanded into other agricultural commodities. This allows for identification and removal of bad actors and poor processes and ensures ideal conditions from farm to market, and we can pinpoint source quickly in the event of a food safety outbreak.

FARM TO FORK

Blockchain technology can also be used to open new markets to farmers. The premise here is that if we can create trust and accountability among market players, there is reduced need to evaluate each person individually on their trustworthiness and ability to execute.

Throughout Africa, technology–led transformation of agriculture sector is already underway, from farm to fork. As technology improves and becomes more widely available, disruption in agriculture promises to accelerate. East African counties – notably Kenya, Rwanda and Uganda – are among those leading the way. Mobile phone penetration across the East Africa has been unparalleled.

The time is right for East Africa to leverage this mobile platform to harness its digital innovations to enable countries to achieve their agricultural potential through efficient use of resources (soil and water) to increase productivity and attain inclusive growth.

Mr Gecheo worked as an ICT and Media Advisor to the Cabinet Secretary of Agriculture and is a Member of the Universal Service Advisory Council of the Communication Authority (nmageka@gmail.com)

Source: Daily Nation

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Mechanization of African agriculture can drive rural employment and stem migration –Report

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A new report showcasing evidence to guide African governments in successfully mechanizing Africa’s agribusiness value chains was launched today by the Malabo Montpellier Panel, a group of 17 African and international experts.The African food and beverage market is projected to reach $1 trillion by 2030. Thanks to advances in renewable energy and digital technology, Africa could leapfrog the stages of technological development other regions have had to undertake, making its mechanization process both swift and extremely lucrative, according to the report.

The report addresses concerns that the mechanization of African agriculture could diminish employment opportunities. Currently, urban labour markets are breaking under the pressures of young people migrating from rural areas into cities. By 2030, it is projected that the number of youth in Africa will have increased by 42 percent. An estimated 30 million young people will join the employment market every year.

“Our report busts the myth that mechanization of African agriculture will be labour replacing. When done right, it can be employment enhancing,” commented Ousmane Badiane, co-chair of the Malabo Montpellier Panel. “Rural employment is critical for reducing poverty, migration and political instability, making mechanization a smart investment for peace and security goals as well.”

The launch of the report, entitled “Mechanized – Transforming Africa’s Agriculture Value Chains”, took place at the Malabo Montpellier Forum in Lilongwe, which gathered African ministers and other high level officials to reflect on its findings.

“African policymakers are eager to deliver on mechanization suitable for their farming communities,” commented the Right Honourable Saulos Klaus Chilima, Vice President of the Republic of Malawi, co-chair of the Malabo Montpellier Forum. “This report provides us with the evidence we need to shape the strategies that will make Africa a place where agribusiness, and those who invest in it can thrive.”

“Mechanization is more than tractors,” commented Joachim von Braun, co-chair of the Malabo Montpellier Panel. “This report emphasizes investment opportunities along the entire agricultural value chain – from small farm production, to processing, to transport and storage.”

“This will reduce the tremendous food losses and counter the raising African food imports. Rural youth demand mechanization to reduce the burden of manual work. If they do not get these opportunities they will continue to walk away,” he added.

Analysis of the policies and investments made by seven African countries determined to be at the forefront of mechanization are a key feature of the report. Ethiopia, Morocco, Mali, Rwanda, Tanzania, Malawi and Zambia have all shown strong growth in both mechanization and agricultural output. Their experience shows that African countries can start to close the large gaps between themselves and other developing regions. Successful mechanization will be key to tackling major challenges on the continent, from spiraling food import costs to rampant rural unemployment.

The seven recommendations set out by the report are:

  1. Develop national agricultural mechanization investment plans that form part of countries’ National Agriculture Investment Plans
  2. Focus on mechanization pathways and strategies that generate new employment opportunities
  3. Prioritize mechanization along the entire food value chain, not just at production level
  4. Invest in supporting infrastructure, such as irrigation systems and electricity grids
  5. Incentivize the private sector to invest in mechanization through tax waivers and smart subsidies
  6. Use public-private partnerships to develop local machinery industries to ensure the technology is affordable and appropriate
  7. Provide localized services that match farmer demand with appropriate technologies

Download the full report

Source: Farmers Review Africa

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REPORT: Tanzania losing out on intra-Africa trade

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Intra-African trade is estimated to have amounted to $371 billion last year, but Tanzania was not among the major beneficiaries, a new report suggests.

According to the Africa Export and Import Bank (Afreximbank) report, Tanzania is among five countries that registered steep declines in their trading with the rest of the continent last year. Others are Mali, Botswana, Zimbabwe, Gambia and Libya, which collectively account for around 11 per cent of total intra-African trade.

The Afreximbank’s African Trade Report 2018: Boosting Intra-African Trade – Implications of the African Continental Free Trade Area Agreement (AfCFTA) says these economies registered steep declines in trading with their peers, which averaged over 20 per cent.

“The champions of intra-African trade remained largely the same in 2017 as in 2016, with South Africa, Namibia and Nigeria contributing over 35 per cent of intra-African trade. This compares with ten other countries – Zambia, Côte d’Ivoire, Swaziland, Botswana, Zimbabwe, DRC, Mozambique and Kenya, Morocco and Ghana – which also account for 35 per cent of intra-African trade,” reads the report.

Source: IPP Media

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Uganda to open EA’s largest organic fertilizer in Tororo

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Sitting on a 600-acre piece of land, the Guangzhou Dongsong Energy Group-owned industrial complex in Tororo District, will produce about 300,000 tonnes of organic fertilisers annually, making it the biggest organic fertiliser plant in East Africa. Ms Jane Guo, the group chief executive officer, said the fertiliser production section will be launched on October 9 with the firm expected to roll out full production in June next year.

“We are on course. Different sections have been given to different contractors and so far the progress is good. ,” she said during a press briefing.

The fertilisers, she said, are designed specifically for Ugandan soils to boost agriculture in the country.

Chemical fertilisers

Uganda imports approximately 100,000 tonnes of chemical fertilisers annually, which Ms Guo says, is dangerous to the soils. Apart from the fertilisers, the factory will also manufacture construction materials such as steel, glass and unbaked bricks.

The fertiliser factory, when completed, will mark years of controversy, corruption and bribery allegations that dogged the process of awarding the company mining rights.

Inspector-General of Government Justice Irene Mulyagonja had previously investigated the company over allegations of fraud, bribery and outright corruption.

However, the IGG later dropped the investigations paving way for the construction of the $650 million investment. Construction work is already going on at the industrial park, with the first batch of equipment expected in the country for installation late this month.

According to Ms Guo, work should have been completed by March. However, there have been delays due to rigorous testing procedures of new technology and failure to secure financing in time.

Source: The EastAfrican

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