REGIONAL: CASHEW SECTOR SET TO RISE 20%

GHANA: 10-YEAR CASHEW MASTER-PLAN TARGETS 150,000MT

SENEGAL: LOOKING TO CREATE NEW GROUNDNUT MARKETING BODY – SOPINAC

Full Story On Page 4

Full Story On Page 5

Full Story On Page 6

AFRICACOM-WATCH

Cameroon Development Corporation Transformed

ISSUE 57 | FEBRUARY 2016

Ghana: Electronic Sika Payment In The Offi ng

Cameroon: 2014-2015 Coffee Production Falls 27%

03 09 12

1

AFRICACOM-WATCH

ISSUE 57 | FEBRUARY 2016

Contents

03 | General

08 | Cocoa

04 | Cashew, Groundnut & Shea

11 | Coffee

Cameroon: Cameroon Development Corporation [CDC] Transformed / AfDB €89 Million Loan For Value Chain Development ProjectGhana: EDAIF Sets Up Equity Fund

Regional: Cashew Sector Set To Rise 20%Ghana: National Cashew Dialogue / 10-Year Master-Plan Targets 150,000MTNigeria: Exports At US$250 Million AnnuallySenegal: Senegal Looking To Create New Groundnut Marketing Body – SOPINACTanzania: Cashew Output May Fall By 20% On Poor Weather

General: Barry Callebaut Sales Lifted By Rising Cocoa Price / Cocoa Leads Sell-Off In Softs, As Ghana Data Quicken Rush For ExitCameroon: Average Price Close To 1,600 CFA KgCote d’Ivoire: Hot Weather, Lack Of Rain Raise ConcernsGhana: Electronic Sika Payment In The OffingNigeria: Midcrop Harvest Seen Down 60% On Harsh Weather

General: Coffee Prices At 5-Year LowAngola: Kwanza Sul Trades Over 2,000 Tons In 2015Cameroon: Coffee Export Increases By 8.24% Last Year / 2014-2015 Coffee Production Falls 27%Ethiopia: Coffee Industry Sees Steady GrowthKenya: New Bill To Shield Coffee Farmers From Unfair Returns / El-Nino Rains Boost Coffee OutputRwanda: Coffee Export Revenues Increase To Over Rwf43 Billion In November 2015Uganda: Production On The Increase

15 | CottonBurkina Faso: Burkina Faso Gets Cotton Trade LoanMali: Mali Suspends Most Cotton Ginning After January RainRwanda: Rwanda Mulls Deal With Chinese Investors to Develop Textile IndustryTanzania: Cotton Yield Likely To Fall This Year

17 | Foodstuffs & BeveragesRegional: Africa Takes Fresh Look At GMO As Drought Blights ContinentAngola: EU Funds Second Phase Of Livestock Project / Novagrolider Company Invests In Agriculture And Livestock In AngolaCameroon: Cameroon Targets 50 Million Chickens For 2016Liberia: Rice Business Hubs Trending In Lofa CountyMauritius: Mauritius Launches Online Weather PortalMozambique: Expects Growth In Agricultural Production In 2016-17Nigeria: Imports Cowpea Despite Being Largest Producer / Bird Flu Kills 3.3 Million Birds In 24 States / Dangote Group Encourages Tomato Production

07 | CassavaNigeria: Delta State Contemplating Selling Processing Plant / Ogun State Partners With Export Promotion Council On Cassava / World Bank To Boost Kogi State ProductionZambia: AfDB Cassava Programme To Be Unveiled

Come Visit Us!CMA CGM Group will host a stand at FRUIT LOGISTICA [http://www.fruitlogistica.de/en/] from 3-5th February at the Berlin ExpoCenter City in Germany. The event is the largest dedicated to reefer transport. With 211,000 TEU we offer one of the world’s most important Reefer container fleets. Come at meet us in Hall 25 – #Booth A-03.

2

Website: www.cma-cgm.comEmail: lhv.marketing@cma-cgm.comTweet: @CMA_CGM_Group

CMA CGM Marseille Head Offi ce4, Quai d’Arenc 13235 Marseille cedex 02 France

Tel : +33 (0)4 88 91 90 00

www.cmacgm.com

Disclaimer of LiabilityThe CMA CGM Group make every effort to provide and maintain usable,

and timely information in this report. No responsibility is accepted for

the accuracy, completeness, or relevance to the user’s purpose, of the

information. Accordingly the CMA CGM Group denies any liability for any

direct, indirect or consequential loss or damage suffered by any person

as a result of relying on any published information. Conclusions drawn

from, or actions undertaken on the basis of, such data and information

are the sole responsibility of the reader.

THE AFRICAN COMMODITY REPORTBrought to you by CMA CGM Africa Marketing

Rachel Bennett Dominic Rawle

26 | Palm OilCameroon: Cameroon Imports 60,000 Tons Of Palm Oil And Derivatives

28 | SugarTanzania: Bulk Sugar Imports In PipelineUganda: Sugar Board In Offing For Uganda

29 | TeaEast Africa: Farmers Miss Fertilizer Subsidy As Government Fails To Factor AllocationsKenya: Tea Auction Operator To Automate Trading

30 | TimberGlobal: COP21: Re-Assessment Of Conservation And Reforestation Policies LikelyCentral/West Africa: Little Change In Prices Expected In Q1Cameroon: New Log Export Restrictions Welcomed By Domestic MillersGabon: High Levels Of Logging By ‘Informal Sector’Ghana: Q3 Export Approvals Up 65%Liberia: EU Review Progress Under Legal Timber Trade Deal

33 | TobaccoMalawi: Low Tobacco Yield Forecasted In 2016Zimbabwe: Tobacco Exports Up On China Demand / TIMB, Agritex Assess Tobacco Crop Ahead of Marketing Season

24 | FruitCameroon: Rougier And WWF To Structure Marketing Of Wild MangoSenegal: Banana Sector Generates 6.5 Billion FCFA

25 | LeatherKenya: Growing Leather Export Sector With New Industrial Park

27 | RubberLiberia: Rubber Plantations To Lay-Off Thousands

21 | Foodstuffs & BeveragesSenegal: WAF To Double Its Horticultural Exports By 2025 / Ban On Carrot ImportationsSouth Africa: Maize Prices Scale New Peaks As Drought Bites / Obama Sets New March AGOA DeadlineSouth Sudan: SABMiller Withdraws From Juba BreweryUganda: Dairy Farmers Protest Milk TaxZimbabwe: Zimbabwe To Step Up Maize Imports As Poor Rain Affects Crops

CameroonCameroon Development Corporation [CDC] Transformed

The Cameroon Development Corporation [CDC] has a new statute as Presidential Decree N° 2016/031 of 19 January, 2016, transforms the corporation into a multi-engaging public utility corporation with the State as unique owner of all shares. This means that no private shares yet exist in the new CDC whose lifespan has been fixed for 99 years. Objectives will be acquisition, creation, administration, exploitation and development of agricultural enterprises through production and transformation of produce

The CDC will assist small holders cultivating similar crops as CDC within the perimeters of CDC factories. It will commercialize agricultural produce either raw or transformed with added value. The new statute means CDC can create new companies, inputs, fusion, association or participation and other means with regards to the development of the Corporation.

The CDC employs 20,000 persons and has as major produce banana and semi-finished rubber, palm oil and palm kernel. It operates nine Rubber Estates, six Oil Palm Estates, five Rubber Factories and two Palm Oil Mills in Mondoni and Lobe. The corporation recently engaged in a number of extension projects to enhance its productivity. Such include 6,000 Ha of oil palm and 6,000 Ha of rubber plantations. A 15T/hr oil mill project at Iloani [Bamusso Sub-Division] was completed in 2009 and put into full operation.

[Cameroon Tribune 21/01/16]

AfDB €89 Million Loan For Value Chain Development ProjectThe African Development Bank [AfDB] has approved a €89.291-million loan to finance the development of an Agricultural Value Chain Development Project [AVC-DP] in Cameroon. The project will be implemented in the Central Basin, which covers the Centre, East and South Regions, and the Littoral Basin, which covers the Littoral and South-West Regions. It will focus on the elimination of constraints on the competitiveness of 3-targeted crop sectors - oil palm, plantain and pineapple - by leveraging infrastructure, crops, youth entrepreneurship and coordination to improve the competitiveness of the three crops value chains.

The move complements operations by the World Bank, the International Fund for Agricultural Development (IFAD), the European Union (EU) and the French Development Agency (AFD), which targets cassava, sorghum, maize, onion, fish, milk and porcine [pigs] sectors.

The rural infrastructure development component of the project is targeting the development of 1,000 km of rural roads, 30 warehouses, 15 rural markets and a quality control laboratory for agricultural products as well as processing units, farmer organizations and research support.

[Master Web 24/01/16]

GhanaEDAIF Sets Up Equity FundThe Board of the Export Trade, Agricultural and Industrial Development Fund [EDAIF] gave approval for GH¢50 million for the set-up of the EDAIF Equity Fund. The Fund will target investments into Small and Medium Enterprises [SMEs] in agro-processing, export trade and industrial development which would be extended to enterprises in crop such as and vegetable; fruits and juices; meat and dairy; and, edible oils.

[Footprint To Africa 21/01/16]

3

COMMODITY NEWSGENERAL

RegionalCashew Sector Set To Rise 20%West Africa continues to evolve its cashew sector with regional production in 2016 projected to rise to 1.8 million tonnes - an increase of about 20%. Producers are likely to receive more than 450 CFAF/kg on the global market due to heighten demand particularly in the US and India up by 10%. The region should also benefit from the current drought in California.

[Ecofin 14/01/16]4

COMMODITY NEWSCASHEW, GROUNDNUT & SHEA

GhanaNational Cashew DialogueThe first-ever National Cashew Dialogue was held in Accra. Organised by the Cashew Industry Association of Ghana under the theme ‘Revitalising the Cashew Sector: An opportunity neglected by the nation’, the forum discussed what needs to be done to get the sector on the right footing. The workshop was aimed at establishing a sector working group for the development, implementation and monitoring of national activities toward achieving a joint sector vision shared by public and private actors. The cashew sector is seen to be one of the most promising economic boosters for Ghana, as it is said to be capable of generating between US$400-500million revenue for the country. With enough investment and policies, Ghana can rival Brazil, India and Vietnam as a premier exporter of processed nuts.

[Ghanaweb 20/01/16]

10-Year Master-Plan Targets 150,000MTA 10-year cashew sector master-plan aimed at increasing production from 50,000 MT to 150,000 MT p.a by 2025 is being discussed by the Ghana government and private sector stakeholders. The plan aims to increase the utilisation of installed processing capacity of 65,000 MT from 5% to 75% by 2025. The sector currently has 14 processing factories with a processing capacity of 60,000 MT, while the country produces 50,000 MT of raw nuts. The deficit, among other challenges, calls for an effective dialogue between the government of Ghana and agencies responsible for implementing policies that will help promote the sector. Worldwide demand for cashew is increasing at around 5% annually.

[Ghanaweb 20/01/16]

5

COMMODITY NEWSCASHEW, GROUNDNUT & SHEA

NigeriaExports At US$250 Million AnnuallyThe National Cashew Association of Nigeria has said that Nigeria’s cashew exports are worth US$250 million yearly, with the average export price increasing annually due to growing demand. Vietnam and India remained Nigeria’s largest buyers. Global demand for the nut has been forecast to increase, and the Nigerian industry wants to increase cashew cultivation areas so that it can produce 500,000T by 2020.

[Fresh Plaza 06/01/16]

TanzaniaCashew Output May Fall By 20% On Poor WeatherThe Cashew Board of Tanzania has said that nut output is projected to drop by about 20% this year, due to bad weather and poor farming methods. Until the end of December 130,000 MT of cashew nut were collected, with total output at the end of the crop-buying season next month expected to achieve 150,000 MT, a shortfall of 39,000 tonnes in the 2015/16 season. Although cashew prices have increased from Sh1,700-2,200/kg, output remains low.

In addition to erratic rainfall arising from climate change, cashew farmers face chronic output problems due to poor farming methods, crop shifting cultivation and the use of bush fires for weeding and farmers are failing to make effective use of insecticides and tools for weeding and pruning. A lack of cashew marketing transparency during auctioning may also be affecting output.

According to 2014 report of Agricultural Non-State Actors Forum, Tanzania is Africa’s largest cashew nut grower after Nigeria and Ivory Coast, and the world’s eighth biggest producer. The Bank of Tanzania reports that the value of cashew nut exports increased from US$137.8 million at the end of October 2014 to US$555.7 million at the end of October 2015.

[The Citizen 07/01/16]

SenegalSenegal Looking To Create New Groundnut Marketing Body – SOPINACSenegal could see the creation of a private company to exclusively manage national groundnut marketing interests if the State decides to follow the recommendations of traders and importers. The Mouvement des Importateurs et Commerçants de Denrées de Première Nécessité [MICDPN] has recommended the creation of the association to be known as the Société Privée d’Intérêt National de Commercialisation de l’Arachide [SOPINAC]. It would be focused on seed production and the establishment of purchasing agreements with producers. That would leave the current organisation, La Sunéor, with the task of processing along with other overseas units.

[Ecofin 19/01/16]

6

NigeriaDelta State Contemplating Selling Processing PlantDelta State is set to sell the multi million naira Uzere Cassava Processing factory to competent investors in its efforts to make investments from cassava outstrip the income from crude oil. The Government owns 80% equity share. The Commissioner for Commerce noted the facility, which has a processing capacity of 10T of fresh cassava tubers per day, has not been properly managed. Delta State is one of the major cassava producing states with average of 2.2 million MT/p.a.

[Daily Independent 23/01/16]

Ogun State Partners With Export Promotion Council On CassavaThe Ogun State Government wants to partner with the Nigerian Export Promotion Council [NEPC] in cassava, cotton and cashew production. The aim is to focus on value chains through the One State, One Product initiative of the Federal Government aimed at diversifying the nation’s economic base. Ogun is targeting an average of 1-million tonnes of cassava p.a.

[ChannelsTV 12/01/16]

World Bank To Boost Kogi State ProductionThe World Bank is to establish equipment hiring enterprise centres for cassava farmers in Kogi state to encourage mechanization as part of the FADAMA III Additional Financing project. US$20 million has been set aside for the centers.

[Star Africa 13/01/16]

ZambiaAfDB Cassava Programme To Be UnveiledA K80-million cassava commercialisation programme to enhance the business value chain is expected to be launched by the end of January in Luapula, Northern and North-Western provinces. The African Development Bank [AfDB] programme is to be implemented by the Citizens Economic Empowerment Commission [CEEC] and will offer access to funding for value chain activities focusing on the commercialisation of cassava.

[Daily Mail 21/01/16]

7

COMMODITY NEWSCASSAVA

GeneralBarry Callebaut Sales Lifted By Rising Cocoa PriceBarry Callebaut AG noted sales revenue and volume grew overall in Q1 of the fiscal year, even as higher prices for cocoa beans relative to cocoa products pushed down growth in the global cocoa unit. In its Q1 sales figures for the 3-months to Nov. 30, 2015, its sales revenue grew 3.8% due to higher prices for cocoa beans. Sales volume grew 6.4% to 494,873 MT, compared with the same period a year earlier, due to growth in units covering emerging markets, outsourcing and gourmet products.

Sales growth was strongest in Asia and the Pacific, where the company reported a 14% increase in the quarter. Sales volume in the company’s global cocoa unit, which measures the amount of chocolate products sold to third parties globally, fell 2% in the quarter. The company attributed the drop to a fall in the price of processed cocoa products relative to market cocoa prices, which eats away at margins. During the same period, prices for cocoa beans on the London-traded futures market hit a more than 4-year high.

The quarter also covered a series of acquisitions for the company, including the purchase of a unit of Dutch beverages company FrieslandCampina Kievet, and a local cocoa sourcing company in Ghana, the world’s second-largest cocoa producer.

[Market Watch 20/01/16]

Cocoa Leads Sell-Off In Softs, As Ghana Data Quicken Rush For ExitCocoa futures plunged 5%, leading a slump in soft commodity values amid indiscriminate selling which also took robusta coffee futures to a 5-year low. Cocoa futures for March in New York tumbled by 4.5% to an 8-month low, for a spot contract, of US$2,800/T. The decline comes amid a broad sell-off on financial markets blamed on the uncertainty provoked by tumbling oil prices, concerns over China’s slowdown and indeed over world economic growth, for which the International Monetary Fund [IMF] trimmed its growth forecast by 0.2 points to 3.4%.

Market rumour has it that Cocobod, Ghana’s cocoa regulator, has bought 590,000 MT of cocoa so far this season, which began in October – a jump of 20% y-o-y. Ghana’s cocoa crop fell to a 5-year low in the 2014-15 season, missing the government’s forecast and prompting export delays. While the purchases data appears to indicate Ghana’s crop is “back on track,” a slowdown in bean arrivals in neighboring Ivory Coast raises questions. And downward pressure on prices gained extra strength after March futures fell below lows reached last week, which had been seen by some investors as a key technical mark.

[Agrimoney 20/01/16]

8

COMMODITY NEWSCOCOA

CameroonAverage Price Close To 1,600 CFA/KgThe farm gate price of cocoa in Cameroon has been running at 1,580/kg FCFA, according to statistics compiled by the Système d’Information des Filières [FIS]. At the end of the last campaign, the minimum average producer prices stagnated at 1,500 FCFA. The improvement is explained by the current dry season which will run until mid-March. During the current campaign [2015-2016], Cameroon expects a drop in production of about 20 000 tonnes, due to the dormancy of cocoa, which, according to experts, occurs every 5 years.

[Ecofin 19/01/16]

Cote d’IvoireHot Weather, Lack Of Rain Raise Concerns Persistently hot weather and a lack of rain in growing regions have fueled concerns about shortages and a poor quality mid-crop. With much of the main harvest already collected, farmers said current weather conditions would impact the quality of beans in coming months and preparations for the April to September mid-crop. Inland, farmers said growing conditions were bad for cocoa trees after the Harmattan damaged fruits in recent weeks. In the southern region of Divo noted that fruits on the trees at the beginning of the mid-crop were drying. Similar growing conditions were reported in the eastern region of Abengourou and in the southern regions of Aboisso and Tiassale.

[Reuters 18/01/16]

GhanaElectronic Sika Payment In The OffingThe Cocoa Sika Payment System, an electronic payment of cocoa beans which was launched last year could be implemented directly following the Finance Ministry’s approval of the scheme at a meeting with Cocobod. The move is expected to help reduce robbery among farmers who carry large sums of monies, improve administrative and accounting as well as enhance the profitability. The cocoa sika payment will also help the Progressive Licensed Cocoa Buyers [PLCBA] to secure bank guarantees to enable their members get seed fund allocation from Cocobod. It will be operated mainly by telecommunication giants, Vodafone and MTN. Despite the unfavourable outlook for cocoa production, Cocobod has forecasted between 850,000 - 900,000 tonnes of cocoa during the 2015/2016 season.

[Peace FM 21/01/16]

9

COMMODITY NEWSCOCOA

NigeriaMidcrop Harvest Seen Down 60% On Harsh Weather

The Cocoa Association of Nigeria [CAN], which groups farmers, traders and grinders, notes Nigeria’s cocoa midcrop output may decline by as much as 60% as prolonged dry weather takes a toll on the trees so much that flowers and buds are falling off cocoa trees. Farmers in the southwestern cocoa belt that accounts for about 70% of production say the crop isn’t faring well, with the last rains in the area falling in late October.

Nigeria’s 2-cocoa harvests include the smaller midcrop from April to June, and the main crop from October to December. The midcrop normally accounts for about 30% of output. Adverse weather conditions and an outbreak of black pod disease has already cut Nigeria’s output by 20% to 190,000T. Cocoa farmers reported a poor main-crop harvest with the start of the 2015-16 season in October after major growing areas were ravaged by floods and disease in the preceding months.

[Bloomberg 25/01/16]

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)

4 Jan 16 2293.37 3182.26 2203.67 3128.00

5 Jan 16 2258.09 3115.17 2159.67 3061.67

6 Jan 16 2200.09 3035.31 2113.67 2978.00

7 Jan 16 2182.48 3021.27 2107.33 2969.00

8 Jan 16 2217.08 3069.20 2153.33 3011.00

11 Jan 16 2131.45 2953.28 2069.33 2894.33

12 Jan 16 2115.87 2924.45 2065.33 2874.00

13 Jan 16 2136.65 2948.53 2075.00 2894.33

14 Jan 16 2104.44 2914.50 2064.00 2853.33

15 Jan 16 2146.01 2969.12 2116.33 2911.67

18 Jan 16 2148.03 2971.91 2117.33 2920.17

19 Jan 16 2161.56 2984.54 2144.00 2928.67

20 Jan 16 2066.82 2857.29 2056.00 2800.00

21 Jan 16 2109.29 2914.22 2087.67 2865.00

22 Jan 16 2126.87 2933.38 2089.00 2875.00

25 Jan 16 2089.42 2878.79 2057.33 2824.33

26 Jan 16 2094.66 2886.57 2050.67 2830.33

10

GeneralCoffee Prices At 5-Year LowCoffee prices have fallen after a forecast for output in Brazil, the world’s top producer and exporter, to rise by as much as 20% to a record in 2016 as rain boosts crops and expands plantings. Growers may reap between 49.1 million and 51.9 million bags, up from 43.2 million bags in 2015. Arabica production may increase as much as 24% while robusta output is seen rising up to 8% according to the Agriculture Ministry’s crop-forecasting agency, known as Conab. Meanwhile Robusta prices in London slide to more than 5-year low.

[Bloomberg 20/01/16]

AngolaKwanza Sul Trades Over 2,000 Tons In 2015At least 2,507T of coffee were sold by farmers in Kwanza Sul province from January to December 2015 reaching prices of 85 Kwanzas /kg for Robusta and 90 kwanzas/kg for Arabica. Planted over 18,395-ha the production areas set to be expanded this year to include a nursery with more than 2-million coffee plants in the municipality of Cassongue for distribution to former cooperatives.

[Angola Press 30/12/15]

CameroonCoffee Export Increases By 8.24% Last YearThe campaign by the Cameroon National Cocoa and Coffee Inter-professional Council [NCCB] to increase coffee export has been positive after the country recorded a 23,672T of coffee export last year up 8.24% according to National Cocoa and Coffee Board [NCCB] data. The report indicated China, Malaysia and Holland were the new destinations of the arabica coffee. Last year, Cameroon produced 21,846T of robusta and 2,109T of arabica Germany, Belgium and Russia were the premier destinations for both the arabica and robust coffee from Cameroon. The 3-countries received 81.36% of the total coffee produced.

Domestic coffee production fell 27% last year as the number of coffee cuttings fell short while exports went higher. According to the Cocoa and Coffee Inter-professional Council, over 23,865T of coffee was produced last year, 27% less than the 32,808T produced during the previous seasons.

[Africa News 23/01/16]

11

COMMODITY NEWSCOFFEE

2014-2015 Coffee Production Falls 27%Cameroon’s coffee production dropped 27% last year as the number of coffee cuttings fell short, but exports rose, according to the National Cocoa and Coffee Board [NCCB]. Production for the 2014-15 season dropped to 23,866T from 32,808T the previous year, pulling the country further from its ambitious target of annual output of 160,000T by 2020. Of this year’s crop, 21,846T were robusta and 2,109T were arabica.

Cameroon is one of the few African producers of robusta and arabica beans. It exports across the world, principally Germany, Belgium and Russia. China, Holland and Malaysia were new buyers last year. The NCCB put the production drop down to a lack of selected cuttings and poor agricultural practices of farmers but did not elaborate. Exports rose to 23,673T despite the drop in production, up over 8% from the 2013-14 season. The 3-main exporters were Olam, NWCA and Uccao. At the end of last season, stockpiles were 11,624T, of which 11,524T was robusta and 99T was arabica. The arabica season runs from Oct. 1 to Sept. 30 while the robusta season is from Dec. 1 to Nov. 30.

[Reuters 20/01/16]

12

EthiopiaCoffee Industry Sees Steady GrowthEthiopia’s coffee exports should increase by 45% to 260,000 tons this year, compared to 184,000 tons in 2014. Coffee exports account for nearly 30% of the country’s hard-currency earnings, with its largest export destinations in Germany and Saudi Arabia. Ethiopia has a range of incentives in place achieve this goal, including marketing linkage, loans for coffee exporters and processors, and the promotion of Arabica coffee aboard. Ethiopia is expanding coffee farms and modernize processing, while the government is taking steps to crack down on the illegal coffee trade. According to the Ethiopian Coffee Growers and Exporters Association, the overall area covered by coffee farms is about 800,000-ha with a potential annual production capacity of 500,000 tons.

[Turkish Weekly 04/01/16]13

COMMODITY NEWSCOFFEE

KenyaNew Bill To Shield Coffee Farmers From Unfair ReturnsKenya’s parliament has received a private member’s Bill which seeks to set the minimum price guarantee for both tea and coffee, and allow coffee farmers to sell their produce at the farm gate to societies rather than wait for payments after milling and selling of the processed beans. The proposed Bill also seeks to establish a fund that will be used to pay farmers in case international prices collapse below the guaranteed minimum returns. If passed the Bill rules will change the traditional management style of the coffee sector, where farmers wait for their pay after coffee has gone through various marketing processes, including milling and auction. It may also create new roles for co-operatives which receive the cherry from farmers.

[Daily Nation 05/01/16]

El-Nino Rains Boost Coffee OutputThe Nairobi Coffee Exchange [NCE] expects to show higher volumes of the crop than anticipated at auction. There were fears that El-Niño rains which began last October would affect the quality of the crop, but the rains seem to have increased volumes beyond expectation. The quantity of coffee auctioned at the NCE declined from 1,768 MT in October to 1,268 MT in November. Average auction price increased from Sh319.60/kg to Sh337.27/kg, attributed to higher quality of the beans traded. Data from Kenya National Bureau of Statistics indicate quantity of coffee exported increased from 3,404.9 MT in September to 4,399.9 MT in October.

[Star 08/01/16]

RwandaCoffee Export Revenues Increase To Over Rwf43 Billion In November 2015The National Agriculture Export Board has reported that Rwanda exported 17.3 million kilogrammes of coffee during the first 11 months of 2015 to November, up from 15.1 million kg in 2014 a 14.61% growth. This was a difference of 2.1 million kilos or an increase of 13.9% compared to quantities sold in the same period in 2014.

Export revenues increased minimally by 0.58% to US$56.3 million during 2015 up from US$56 million fetched in 2014. Total production of green coffee over the period amounted to more than 17.3 million kg compared to 15.1 million kg during the same period in 2014.

The sector’s earnings were, however, affected by the drop in global coffee prices, which deteriorated by 23% from US$4.23 to US$3.24 in July of 2015. As a result, coffee export revenues declined by almost 21% over the reporting period.

[New Times 13/01/16]

UgandaProduction On The IncreaseThe Uganda Coffee Development Authority [UCDA] has reported that it is expecting a significant 27% increase in Ugandan coffee production in 2015/16 to 4.8 million bags due to increased planting.

[ICO 15/01/16]

14

Burkina FasoBurkina Faso Gets Cotton Trade LoanBurkina Faso’s largest cotton exporter, SOFITEX, has received a €70mn trade loan from the International Finance Corporation, the Global Agriculture and Food Security Programme’s private sector window and Société Générale, which will allow them to buy raw cotton from over 160,000 local farmers for processing and export to international markets. The three lenders will provide funds against warehoused commodities to improve the company’s liquidity and ability to purchase crops. SOFITEX already received a similar loan last year, which helped it export a record 750,000 tonnes of cotton supplied by 160,000 farmers.

Cotton is Burkina Faso’s largest source of foreign currency, and the sector employs over 3 million people. But the price drop observed in the commodities world in the past year, coupled with lower demand for cotton, have affected producers’ ability to raise financing, and put Burkina Faso’s development at risk.

The GAFSP is a mechanism set up to help in the implementation of G20 food security-related pledges. Its private sector window provides loans, credit guarantees, equity and advisory services to support private sector activities that improve agricultural development and food security. Managed by the IFC, it includes Canada, the Netherlands, the US, Japan and the UK as donor partners.

[GTR 13/01/16]15

COMMODITY NEWSCOTTON

MaliMali Suspends Most Cotton Ginning After January RainMali’s state-run cotton company will suspend ginning in most regions after unseasonable rains, the latest setback for the nation’s crop in a season hit by unusual weather. . It is not clear how long the suspension will last. Mali should be in its dry season, but two days of heavy rain have drenched crops in the fields and rendered them temporarily unfit for processing. Mali’s cotton season, which normally ends on March 31, could be extended if delays continue. This is not the first time rains in the Sahel region have affected cotton processing in Africa’s second-largest producer. Mali missed its 2015-2016 production target for raw cotton by 100,000 tonnes after late rains.

[Reuters 08/01/16]

RwandaRwanda Mulls Deal With Chinese Investors to Develop Textile IndustryThe Rwandan government is mulling a joint venture with Chinese investors to establish a garment factory in the Kigali at an estimated cost of US$1.3 million. The investment would include 670 machines to produce different types of clothes. Rwanda wants to develop its own textile industry, cut imports of garments and create jobs through the factory. Last year, imported clothes both new and second hand cost Rwanda over US$100 million dollars. Rwanda has two textile companies in Kigali, including the Chinese-run C&H Garments whose products are exported. C&H Garments has invested in computerized sewing machines and will train up to 400 local workers.

[Xinhua 15/01/16]

TanzaniaCotton Yield Likely To Fall This YearAccording to the Tanzania Cotton Board [TCB] heavy rains that hit most of the crop producing areas in the western zone has thwarted cotton planting making it impossible to achieve the normal 1-million acres. Also some seeds supplied to farmers had problems, with about 16,000 tones failing to germinate. The country experienced an acute shortage of cotton last year due to prolonged drought that hit the crop producing areas. The board had earlier projected to harvest 250,000 tones of seed cotton but due to bad weather it ended up with 150,000 tones.

[Daily News 19/01/16]

16

RegionalAfrica Takes Fresh Look At GMO As Drought Blights ContinentA scorching drought in Southern Africa that led to widespread crop failure could nudge African nations to embrace genetically modified [GM] crops to improve harvests and reduce grain imports. The drought, which extends to South Africa, the continent’s biggest maize producer, has been exacerbated by an El Nino weather pattern and follows dry spells last year that affected countries from Zimbabwe to Malawi. That has brought GM crops to the fore, especially maize, a staple crop grown and consumed in most sub-Saharan countries.

Many African countries have banned GM crops, arguing that they will cross contaminate other plants, pollute the environment and could have long-term health effects for humans. Zimbabwe, for instance, says although GM crops may initially be resistant to pests, the resistance could breakdown over time. GMO advocates, however, say the fears are not scientifically proven, adding that poor African farmers are likely to benefit most from reduced use of pesticides, lower production costs, higher yields and high prices for crops. The African drought’s impact is particularly serious for Zimbabwe, where the economy has struggled for five years to recover from a catastrophic recession marked by billion percent hyperinflation and widespread food shortages. Zimbabwe does not accept GM maize imports, and when it has accepted emergency GM maize aid, it has been milled under security watch.

The United States, Brazil and India are the world’s largest growers of GM crops while in Africa, South Africa is the only country producing GM maize on a commercial scale. Perceptions are shifting, with Burkina Faso and Sudan having started to grow GM cotton commercially. Kenya, Uganda, Malawi, Swaziland, Nigeria and Ghana have all been carrying out trials on different GM crops.

Agrichemicals groups such as Monsanto, the world’s largest seed company, and Syngenta are well placed to benefit from increased use of GMOs in Africa. Monsanto conducted trials of GM maize and cotton in some African countries, including Zimbabwe between 2001 and 2005. But the transition from tests to commercial growing has been slow, a reminder of the diehard attitudes towards GM crops.

A major factor that could influence Africa to start growing GM maize was whether China would grow GM rice, which it has developed but not released for production.

[Reuters 11/01/16]17

COMMODITY NEWSFOODSTUFFS & BEVERAGES

AngolaEU Funds Second Phase Of Livestock ProjectThe European Union this year will contribute 5 million euros to finance the second phase of the Sanga project in Angola. The Sanga project focuses on building infrastructure to support the development of livestock farming in five provinces of Angola – Huila, Benguela, Namibe, Cunene and Huambo – the second phase being the construction of 15 municipal veterinary pharmacies. The funding continues a project begun in 2008, whose first phase ended in 2014, in the municipalities of Bié and Kuando Kubango.

[Macauhub/AO 13/01/16]

Novagrolider Company Invests In Agriculture And Livestock In AngolaAgro-livestock group Novagrolider plans to invest US$15.1 million in farming and processing of horticultural products in Angola. The investment will be to build a factory for processing fruit and vegetables, as well as in the production of flowers and dairy products, meat and other similar products, to be built in the municipality of Quibala, Kwanza Sul province. The Novagrolider group has several farms in Angola, specifically in Caxito, northern Bengo province, Bom Jesus, in Luanda and Quibala, Kwanza Sul province.

[Macauhub/AO 14/01/16]

CameroonCameroon Targets 50 Million Chickens For 2016The members of l’interprofession Avicole du Cameroun [Ipavic] projects a production of 50 million chickens in Cameroon in 2016 up from 45 million in 2015. Ipavic cites the current cost of corn, 160 CFA francs down from 200 CFA francs, as the main factor encouraging farmers to produce more. French group Somdiaa, a leader in the Cameroon sugar market is to produce chicks through its local subsidiary Sosucam. The group is already present in this sector in Gabon through its milling and poultry Société meunière et Avicole du Gabon which produces 350,000 chicks per year.

[Ecofin 20/01/16]

LiberiaRice Business Hubs Trending In Lofa CountyThe United States Agency for International Development Food and Enterprise Development program [USAID FED] has partnered with rice producing organizations, such as the Agriculture Infrastructure Investment Corporation [AIIC] in Lofa County to promote rice farming. The AIIC farming group operates a rice business hub in Lofa County that generates income and creates processing opportunities for nearby communities.

AIIC hopes to increase rice production through the procurement of agricultural goods, creation additional market opportunities, and provides technical assistance, such as training in lowland and upland rice cultivation.

In total USAID FED has established 3 rice-processing centers in Lofa County. It is anticipated that these rice business hubs will increase the availability of clean processed rice for people living in Lofa County and surrounding areas. USAID FED is expected to construct an additional 10 rice business hubs in Liberia.

[Daily Observer 07/01/16]

18

MauritiusMauritius Launches Online Weather Portal Mauritius has launched an agricultural decision support system [ADSS] to collect and disseminate timely and accurate information on weather and climate change. The ADSS will relay information about temperature, humidity, rainfall, wind speed and direction and solar radiation to farmers, university students and researchers. Initiated by the Government and funded by Japan under its Cool Earth Partnership Programme for Africa it is part of the Africa Adaptation Programme. Mauritius food import bill stands at US$1 billion p.a too much for such a small economy.

[SciDev 15/01/16]

MozambiqueExpects Growth In Agricultural Production In 2016-17Agricultural output this year is expected to grow by 6.5% a slight increase on the of 5.9% growth expected for 2015. The 2016-2017 campaign should see an expected increase of 13.4% in the grain harvest, which is expected to reach 2.8 million tons, including 2.1 million tons of maize and 450,000 tons of rice. Legumes, with a forecast of 730,000 tons, are expected to increase by 11.5%, while the roots and tubers will see an increase of 12.4%, reaching 11 million tons. Vegetable production is expected to rise by 9.1%, with estimated production of 1.8 million tons. These production levels will be achieved by increasing the area under cultivation, agricultural mechanisation, use of animal traction, improved seeds and use of fertilisers and pesticides in combination with new technologies that will contribute to increased yields and agricultural production.

[Macauhub/MZ 12/01/16]

NigeriaImports Cowpea Despite Being Largest ProducerNigeria currently imports 600,000 MT of cowpea every year despite being the world’s leading producer of the crop. The country needs an estimated 2.6 million MT of cowpea a year. Poor quality seeds, storage facilities and underfunding of research activities as some of the factors responsible for the deficiency.

[Daily Trust 07/01/16]

Bird Flu Kills 3.3 Million Birds In 24 StatesKatsina, Adamawa Bayelsa and Ebonyi are the latest states affected by bird flu, bringing the total number of states affected since 2015 to 24. According to the latest data from the Department of Veterinary and Disease Control of the Federal Ministry of Agriculture and Rural Development, 96 local government areas have recorded the outbreak while estimated 2.5 million birds have been depopulated and buried.

[Daily Trust 19/01/16]

19

COMMODITY NEWSFOODSTUFFS & BEVERAGES

Dangote Group Encourages Tomato Production Dangote farms have signed a Memorandum of Understanding [MoU] with Bank of Agriculture [BOA] and Kano State Water Users Association on tomato production for the consumption of Dansa Tomato Company, a subsidiary of Dangote farms. N55.8 million has been approved by the bank for the take-off of a pilot project which comprises 100 registered farmers as beneficiaries on 100-ha.

Over the last 5-years the Dangote Group has been working to build a US$20-million tomato processing plant outside Kano. Built by Switzerland-based Syngenta the facility is due to open soon. It is hoped the giant factory the size of 10 football pitches, set alongside 17,000-ha of irrigated fields, will help by tapping a potential agricultural goldmine. The country’s agriculture ministry puts annual current demand for tomato puree at 900,000 tonnes.

[Naija 247 17/01/16]20

SenegalWAF To Double Its Horticultural Exports By 2025Anglo-South African multinational WAF West Africa Farms [WAF] intends to double its exports of horticultural products to over 150,000 tonnes over the 2017-2025 period. To achieve its objective, WAF will increase its acreage from 200-ha to 500-ha and will diversify crops. Amongst other foodstuffs it produces radishes and onions.

[Ecofin 18/01/16]

Ban On Carrot ImportationsFrom 02/01/2016 the Senegalese Government has banned carrot importations. Therefore CMA CGM will no longer accept carrot shipments. For further information, please contact our local Senegalese customer services desk on Tel: +221 33 849 92 00 or a.customerservice@cma-cgm.com

South AfricaMaize Prices Scale New Peaks As Drought BitesSouth African maize prices maintained their record run into 2016, scaling historic highs amid growing drought concerns. The March contract for white maize added almost 2.6% to a new record of R4,781/T while the yellow variety climbed 1.8% to R3 677/T.

Prices for white maize more than doubled in 2015 while those for yellow maize, used for animal feed, rose around 70% last year. The drought in South Africa has been exacerbated by an El Nino weather system, and it follows a bad harvest last season when dry conditions shrivelled the maize crop by a 33% to 9.94-million tonnes, the lowest since 2007.

Transnet SOC Ltd., South Africa’s state-owned ports and rail operator, notes the local port system can handle all the estimated maize imports as the country draws up plans to meet demand amid the worst drought in more than a century. South Africa, which is usually a net exporter of maize, will probably need to import 5 million tons to 6 million tons of the commodity. Transnet has grain-handling facilities at the ports of Durban, Cape Town, Port Elizabeth and East London and recently started using capacity at Richards Bay.

[Reuters 05/01/16]

21

COMMODITY NEWSFOODSTUFFS & BEVERAGES

Obama Sets New March AGOA Deadline South Africa has received a March 15th deadline to ensure the entry of US poultry within 60 days or lose some of its duty-free benefits under the African Growth and Opportunity Act [AGOA].

The Department of Trade and Industry [DTI] has assured that the suspension would not be implemented, with the proposed suspension expected to be lifted as soon as the first shipment of poultry enters the South African market within the next few weeks.

The renewed suspension merely serves as a deadline to ensure successful US poultry trade in South Africa with the full AGOA benefits reinstated “at any time” if the US determined that South Africa was meeting the agreed criteria set out by the US Congress to resume trade of the 3-meats: poultry, beef and pork.

The surprise move followed the resolution earlier of all long-standing disagreements over sanitary and phytosanitary matters surrounding the imports of the 3-meats after South Africa missed the US-stipulated deadline to concede to certain demands for the elimination of barriers to trade.

Pork On the importation of shoulder cuts, South Africa has agreed to permit the unrestricted importation of the shoulder cuts after the USA agreed to apply mitigation measures including the removal of risk material before exportation to South Africa.

Beef South Africa had already agreed to import beef from the USA, however, the USA requested to be permitted to import livestock from third countries for direct slaughter and the meat thereof to be exported to South Africa. The USA has given guarantees that livestock imported from third countries for further export of the products thereof to ensure compliance with the USA domestic requirements. South Africa has agreed to the assurances given by the USA.

Poultry 2-issues under consideration:

Highly Pathogenic Avian Influenza [HPAI]: after robust discussions, an agreed Avian Influenza protocol for safe trade of poultry and poultry products was concluded in November 2015. The protocol will ensure that appropriate scientific measures are taken by the USA to ensure that the risk of transmission of HPAI to South African poultry is managed.

Salmonella: the USA requested South Africa to reconsider its application of the Procedure Manual on Microbial Monitoring of Imported Meat. According to the Manual, all imported poultry products are tested for microbiological contamination which includes Salmonella and other conditions at the port of entry before they are released into the market. South Africa imports from over 3000 establishments across the world, and the testing requirements apply to all these establishments.

After intense negotiations, and the review of the USA food laws, South Africa has agreed to, for the first 3-months, risk profile all consignments imported from USA export establishments. Thereafter, a revised statistically risk-based sampling plan will be implemented. South Africa will sample and test all consignments for compliance. The Department of Health will monitor these products after release from ports on entry.

Trade and Industry Minister Dr Rob Davies noted all AGOA documents were signed, with a balance struck between opening up trade and mitigating animal and human health protocols to avoid any risk. However, US Trade Representative Michael Froman issued a post-agreement statement saying that continued successful participation in the AGOA now relied on consumers’ uptake of the imported meats. The DTI and Department of Agriculture are working closely with the US Embassy in South Africa, local importers and US exporters to facilitate the first shipments of US poultry under the agreed 65 000 t/y quota for US bone-in-chicken pieces.

[Engineering News 12/01/16]

22

South SudanSABMiller Withdraws From Juba BrewerySABMiller is to call time on its brewery in South Sudan, after its business has been hampered by an acute shortage of foreign currency, a problem that has left it unable to buy the raw materials it needs to continue brewing. SABMiller built the country’s first brewery on the outskirts of the capital, Juba, in 2009.

[Fast FT 15/01/16]

UgandaDairy Farmers Protest Milk Tax

Dairy farmers under Uganda Crane Creameries Cooperatives Union [UCCCU] have expressed fears that proposed taxation will be a hindrance to development of the industry, forcing farmers out of new cooperative unions.

Dairy cooperative unions are new phenomenon in the country following the privatisation of Dairy Corporation. Under this system, farmers are able to set up their own industries and cooperative groups. However, the majority of farmers in Uganda sell through informal sector, where the cost of production is very high.

The UCCCU, with funding aBi Trust, have been instrumental in boosting the dairy industry in the south western Uganda, increasing milk production, value addition and cold chain management through acquisition of milk tankers. So far 671 farmers have been trained and adopted to recommended standards. Altogether, the UCCCU has a membership of about 20,000 dairy farmers. Milk production has increased from 57.5 million litres in 2014 to 141 million litres in 2015.

If farmers leave the cooperative movement for the informal sector to avoid the new tax, they will lose on bulk marketing. There will be loss of jobs, decline in milk volumes and deterioration of milk quality. Farmers are not opposed to the new tax, but want the government to give the industry time reorganises itself.

[The Monitor 13/01/16]

ZimbabweZimbabwe To Step Up Maize Imports As Poor Rain Affects CropsZimbabwe plans to import up to 700,000 MT of maize this year as the El Nino weather pattern brings poor rains and affects crops. Zimbabwe has secured a US$200 million loan from Africa Export and Import Bank [Afreximbank] to cover the import cost. Last year the government imported only 100,000 MT, as of November. Zimbabwe received less than three quarters of its rainfall needs in November and December, the first 2-months of the agricultural season, which will worsen shortages. The government will allocate US$260-million to import between 500,000-700,000 MT to cover deficits.

[Reuters 05/01/16 & 22/01/16]

23

COMMODITY NEWSFOODSTUFFS & BEVERAGES

CameroonRougier And WWF To Structure Marketing Of Wild Mango To increase the income of farmers harvesting forests in Mbang, East Cameroon, the Rougier Group and World Widelife Fund [WWF] are working on the structuring marketing of non-timber forest products wild mango and Djansang an oily seed. The project is part of the Global Forest & Trade Network [GFTN], an initiative to promote good forest management and responsible trade. The partnership, sealed in 2015, extends in Congo and Gabon.

[Ecofin 25/01/16]

SenegalBanana Sector Generates 6.5 Billion FCFA The Ministry of Agriculture and Rural Equipment has said that the banana sector in Senegal has over 9,000 producers earning over 6.5 billion FCFA a year. Despite this, Senegal is still importing bananas. In 2013 imports reached 17,066 tons and 15,567 tons in 2014.

[Fresh Plaza 14/01/16]

24

COMMODITY NEWSFRUIT

KenyaGrowing Leather Export Sector With New Industrial ParkKenya plans to construct a 500 ha leather industrial park hosting tanneries and value addition facilities at Kinanie in Machakos County. The Ministry of Industrialisation has given the Export Processing Zone Authority [EPZA] the go-ahead to build the park in Athi River, 35km from Nairobi and 17km off the Nairobi-Mombasa highway. The master plan proposes phased development of 36 tanneries on 1-ha plots, complemented by 8-leather value addition parks. The initial phase will target 20 tanneries, each with a production capacity of about 10 tonnes of raw hides and skins daily, and an output of 10,000 pairs of shoes, hand bags, leather garments and industrial gloves.

The country’s leather sector generates Ksh10 billion [US$100 million] annually and is projected to earn 10 times more by exporting more finished products than the current wet blue [semi-processed] leather. There are 14 active tanneries in the country with a capacity of processing 2.28 million hides and 18.6 million skins.

Kenya, through the EPZA, will invest about Ksh7 billion [US$70 million] in the leather industrial park, which will have a common tannery effluent pre-treatment plant, serviced plots, electricity and roads. The leather industrial park will have a trade centre, logistics and Customs offices that will host various government regulatory authorities and organisations facilitating movement of goods, an administration centre and a housing estate with 1,200 units. The facilities will enable the sector to move from exporting wet blue leather to finished products. The government plans to set up an additional 6- tanneries at Wajir, Garissa, Makueni, Isinya, Mogotio and Kanduyi.

[East African 26/12/15]25

COMMODITY NEWSLEATHER

CameroonCameroon Imports 60,000 Tons Of Palm Oil And Derivatives Cameroon’s Ministry of Trade has authorised the import of 60,000 tons of palm oil, in addition to local production, for 2016 in order to meet demand from oil processors. These raw materials will be imported exempt from VAT and with a preferential customs rate of 5%. Cameroon has a yearly production deficit of 130,000 tons of palm oil, according to official figures.

[Business in Cameroon 06/01/16]26

COMMODITY NEWSPALM OIL

LiberiaRubber Plantations To Lay-Off ThousandsThousands of workers within Liberia’s rubber sector could soon be laid-off due to the prolong drop in the price of the commodity on the global market. The General Agriculture and Allied Workers Union of Liberia [GAAWUL], an umbrella organization of workers within the sector, has said that the drop in the price of rubber has taken a hard hit on Liberian plantations, to the effect that their members have not taken pay for months. GAAWUL is worried that this is an indication that these plantations may soon be forced to close. The union is appealing to the government and international community to financially intervene to protect Liberian owned rubber plantations.

[New Dawn 07/01/16]27

COMMODITY NEWSRUBBER

TanzaniaBulk Sugar Imports In PipelineThe Sugar Board of Tanzania [SBT] noted a process to pave the way for the formation of an entity to oversee bulk sugar importation is expected to be completed by the end of this month. A number of issues including structural and organisational arrangements have already been agreed. The new system is intended to ensure proper, efficient and effective management of gap sugar importation. As such the Sugar Industry Regulations of 2010 have been amended to recognise Bulk Sugar Importation through a Bulk Procurement Entity. Formation of the entity is planned to be completed by end of January, 2016. Bulk sugar importation was earlier scheduled to start in September last year, but had to be shelved to allow further consultations among stakeholders.

[Daily News 16/01/16]

UgandaSugar Board In Offing For UgandaThe Uganda Sugar Board [USB] is soon to become reality as the Ugandan Cabinet has approved and passed on to Parliament the new sugar Bill to streamline management and licensing of sugar mills. The Bill, which was drafted by the Ministry of Trade, Industry and Cooperatives, also provides for a regulatory framework. It will oversee the industry which in recent years has seen a sharp rise of sugar milling factories and spells out clear conditions for registration and licensing of sugar producers. The move intends to ensure greater quality and high production standards.

Uganda produces 462,500T of sugar annually. The country only consumes 300,000T while the remainder is exported, according to the Uganda Sugar Manufacturers Association. Currently, the number of registered sugar companies in Uganda stands at 23. Among the newly established sugar factories in Uganda include G.M Sugar Ltd, [2006], Uganda Crop Industries, [2008], Mayuge Sugar Ltd, [2009], Seven Star Sugar Ltd, [2010], and Kaliro Sugar Ltd, [2013]. Sugar has been an issue of contention between millers and traders themselves, and occasionally putting the country at loggerheads with its trading partners due to unclear regulation.

[EA Buisness Week 24/01/16]

28

COMMODITY NEWSSUGAR

East AfricaFarmers Miss Fertilizer Subsidy As Government Fails To Factor Allocations The Kenya Tea Development Agency has appealed to the government to give tea farmers fertilizer subsidy to boost their production. The agency was disappointed to find that the government was backtracking on the promise it had made to farmers on the fertilizer subsidy. Over 260, 000 small scale tea farmer are likely to miss out on a Sh600 million fertilizer subsidy promised by the government last year. Former Agriculture Minister Felix Koskei promised that farmers would get a Sh500 per 50kg bag of fertilizer at a subsidized cost. KTDA imported more than 200 MT of fertilizer between July and August 2015 to be distributed across the country, which translated to over 1.3 million bags.

[Hivisasa 14/01/16]

KenyaTea Auction Operator To Automate TradingKenya will this year begin to automate trading at its weekly tea auction of regional produce to increase transparency in dealings. The East African Tea Traders Association [EATTA], which runs the sale, hosts the world’s biggest tea auction, selling produce from 9-African nations, including from Burundi, Rwanda, Uganda, Malawi and Mozambique. Ethiopia is due to join in March. Complete automation will be completed in 2017 but the first phase will be in place this year. Automating the auction will cost US$1.3 million funded by Trade Mark East Africa [TMEA].

[Reuters 20/01/16]

29

COMMODITY NEWSTEA

GlobalCOP21: Re-Assessment Of Conservation And Reforestation Policies LikelyThe recent climate change meetings in Paris have influenced governments in the region to begin reassessment of their conservation and reforestation policies say analysts and new domestic initiatives on climate change and forestry are anticipated in the coming months.

[ITTO 01-15/01/16]

Central/West AfricaLittle Change In Prices Expected In Q1West Africa log and sawnwood prices remained unchanged through late December and into the first half of January. Producers in the region expect little, if any, change in price structures during Q1 2016. Chinese New Year is early this year beginning 8 February and, while it is unlikely that trade levels can drop any lower, there will be the usual absence of buyers in the market.

Analysts are of the opinion that buyers for the Chinese market have no incentive to resume purchases ahead of the celebrations and long vacation. Perhaps the best prospects for a resumption of buying for the Chinese market will be in Q2 but so much depends on importers and merchants in China being able to move their current high stocks.

However, there is little sign of growth in China’s real estate sector which weakened significantly in late 2015. Producers are hoping that the modest but steady expansion of demand in Europe will continue in 2016 as this has underpinned price stability, even though the volumes being purchased are not large in terms of EU total hardwood consumption.

[ITTO 01-15/01/16]

CameroonNew Log Export Restrictions Welcomed By Domestic MillersCameroon sawnwood exports performed particularly well in 2015 and new log export restrictions are aimed at reserving premium species for domestic processing. This is a relief to sawmillers who are complaining of a tight log supply for the most favoured export timbers.

[ITTO 01-15/01/16]

GabonHigh Levels Of Logging By ‘Informal Sector’ Reports from Gabon suggest some officials are still being investigated over illegal exports of kevazingo/bubinga and now some concession holders have expressed concern over the high levels of logging in the ‘informal sector’ which will be difficult for the forest authorities to control.

[ITTO 01-15/01/16]

30

COMMODITY NEWSTIMBER

GhanaQ3 Export Approvals Up 65%During Q3 2015 the Timber Industry Development Division [TIDD] of the Ghana Forestry Commission [GFC] vetted and approved export contracts totalling 172,124 cu.m. Compared to Q2 contract volumes this represented an increase of over 65%.

Approved Contracts Volumes

Q2 2015 Q3 2015

cu.m % cu.m %

Primary 14,531 14 7,004 4

Secondary 87,230 84 162,060 94

Tertiary 2,126 2 3,060 2

Total 103,887 172,124

In Q3 2015 the volume of approved sawnwood contracts increased to 162,000 cu.m, an increase of 86% over Q2 volumes. This increase was mainly due to the lifting of the export ban on rosewood sawnwood during Q3. Sawn rosewood accounted for 39% of the total volume of the contracts approved in Q3. In addition, compared to the Q2, there was a 37% increase in approvals for teak exports and a 12% increase approvals of other sawnwood contracts.

In Q3 there was only a minor change in tertiary product exports approvals. Approvals for primary product exports fell in Q3 2015. The volume of contracts for gmelina log exports submitted in Q3 fell almost 75% [2,000 cu.m] compared to Q2. Similarly, exporters submitted very few contracts for teak poles/billets export. Logs go mainly to the India market and in Q3 contract volumes were down over 26%. Contract submissions for the export of plywood to neighbouring countries [overland export] fell to 19,282 cu.m, an almost 6% decline.

Sawnwood export contracts in Q3 accounted for almost 80% of the total volume of contracts approved during the Q3 [136,461 cu.m], a sharp increase compared to the previous quarter. The market structure for Ghana’s wood product remained unchanged in the third quarter. The regional West African market continued to be the major destination for Ghana’s plywood. Sliced veneer and kiln dried sawnwood exports are mainly destined for European markets while air dry sawnwood, especially rosewood and other high density species such as apa, ekki and denya are for the Chinese market. The US market continued as the major destination for mahogany/cedrela sawnwood lumber and rotary veneer. The Middle East and Egyptian markets are emerging as a major destination for backing grade rotary veneer.

[ITTO 01-15/01/16]

31

COMMODITY NEWSTIMBER

LiberiaEU Review Progress Under Legal Timber Trade DealLiberia and the EU met to review progress towards implementation of their Voluntary Partnership Agreement [VPA], which aims to ensure Liberia exports only legal timber products to the EU. The Liberia-EU VPA Joint Implementation Committee [JIC] met for the 3rd time on 20-22 January in Monrovia. The JIC is the body established to oversee the implementation of the agreement.

The Government and forest-sector stakeholders are working to create a system to ensure the legality of timber produced in Liberia. Progress has been made with the Liberian timber legality assurance system, notably with the establishment of the new Liberia Verification Department and software called LiberTrace, which will manage data used to track timber and verify its legality as it moves from forest to port/point of sale. Discussions also covered improvement of the 2016 regulatory framework as well as monitoring environmental, economic and socials impacts of the VPA.

Under the VPA, Liberia commits to developing a timber legality assurance system so it can issue verified legal timber products with FLEGT licenses. Once this system is operational, Liberia commits to export to the EU only FLEGT-licensed timber products. The EU commits to allow imports of FLEGT-licensed timber from Liberia to enter the EU market without due diligence checks. Last year, the sector generated more than US$8 million in tax revenue.

[FPA 23/01/16]

RESOURCESThe JIC published the first joint annual report on the VPA, covering the period until the end of 2014. This is available on the FDA website www.fda.gov.lr

32

MalawiLow Tobacco Yield Forecasted In 2016The Tobacco Control Commission has predicted low yields for Malawi this year due to dry spell which is likely to affect the crop. The TCC said most parts have not yet received rainfall since December, raising fears that Malawi might experience a sharp drop in production. Malawi depends on tobacco as its major exchange earner, accounting for over 15% of its annual GDP. The country, the 12th largest tobacco producer in the world earned US$337.3 million in revenue last year.

[APA 12/01/16]33

COMMODITY NEWSTOBACCO

ZimbabweTobacco Exports Up On China DemandZimbabwe’s tobacco export earnings rose 11% to US$855 million in 2015 on higher prices and demand from China, but production this year could suffer from a scorching drought. Tobacco is the Southern African nation’s single largest export commodity, ahead of platinum and gold. The Tobacco Industry and Marketing Board [TIMB], said Zimbabwe - which exports 90% of its tobacco - sold 152 million kg of tobacco, up from 136 million kg in 2014.

Cigarette makers in China, the world’s biggest market and grower of tobacco, bought 62 million kg worth $513 million or 60% of total earnings and nearly double its 2014 purchases. Other major buyers of Zimbabwe’s flue-cured tobacco, which is used as a flavouring in cigarettes, are Belgium, South Africa and Indonesia. Chinese buyers paid an average of US$8.31/kg, more than double what the other major buyers offered.

TIMB noted the El Nino-induced drought had delayed tobacco planting. TIMB is carrying out an assessment of the current crop, which will be harvested from March. Production fell 8.5% to 189 million kg last year with farmers projecting lower output this year after drought scorched their crops.

[CNBCAfrica 20/01/16]

TIMB, Agritex Assess Tobacco Crop Ahead of Marketing SeasonThe Tobacco Industry and Marketing Board [TIMB] and Agritex are conducting a crop assessment in all tobacco growing areas that will be used to prepare a crop estimate for the 2016 marketing season as well as help determine the opening dates for this year’s marketing season. The tobacco season last year started in March instead of February as most farmers were still busy in their fields.

The Tobacco Industry and Marketing Board intends to use e-marketing technology this year in order to improve the marketing system. The introduction of e-marketing at Zimbabwe’s auction floors is aimed at increasing transparency in the tobacco business especially the selling of the crop. India is facilitating the software and the hardware while the other equipment will be obtained from local companies.

Tobacco production has been on the increase for the past years with farmers switching from crops such as maize and cotton to the lucrative golden leaf. Farmers have, however, been complaining about the selling price of US$4.99/kg at the auction floors while contract floors offer prices above US$5/kg. According to contractors, the prices at the contract floors are higher to incentivise farmers and reward them for not side marketing the crop.

[Herald 13/01/16]

34