Exclusive interview with Jon McLea, Director, Agricona, who will chair a session at the upcoming Agribusiness Congress East Africa in Kampala on“Agribusiness insights: Solutions addressing rapid growth in the region.”
1) Let’s start with some background on Agricona and the work that you do, particularly in the agri sector?
Agricona is a consulting firm focused on agriculture and specializes in technical advisory services for
• Site identification and scouting for agricultural land and projects in Sub Saharan Africa
• Site evaluation and due diligence studies
• Project formulation and feasibility for the set up of new agricultural projects
• Project and operational management and support for start up, and existing projects
• Crop trials and Agronomy services
• Technical support to Out Grower Programs & Contract farming
• Technical and Operational Due diligence
2) Which current projects are you particularly excited about at the moment?
15 000 acres of commercial cotton being established in Northern Uganda.
3) What in your view are the main challenges facing the agri sector in East Africa?
Land tenure and affordable finance are the major challenges to expanding and developing the agri sector. Current interest rates put enormous stress on agribusiness and are often prohibitive. We need to look at novel ways to finance the agri sector, and get around using land as collateral. Fortunately we are starting to see special purpose funds enter the market space, offering new opportunities for those looking to raise finance, be it for working capital or infrastructure.
4) Any success stories/case studies that you can share?
I was recently did some work with International Fund for Agricultural Development, at Oil Palm Uganda Ltd’s Oil Palm plantation on Kalangala. I was very impressed by the successful integration of commercial plantations and 1800 smallholder plantations. There are plans to expand on a successful and proven model, and this will be an exciting project to watch.
We also continue to see a steady inflow of foreign investors into Uganda’s farming sector, and strong support for the industry from large NGOs such as Palladium Groups NU Tec Program and USAID’s YLA program.
5) What is your vision for the industry?
Large scale farms will always have a role to play, but this role is limited by the availability of suitable large contiguous areas of land. Fragmented land parcels make up the large portion of arable land. This means we need to focus on developing the local medium scale commercial farmer to feed the continent. We already see this taking shape with a number of small actors in the value chain, starting from the land holder renting to the farmer, who rents tractor services from a contractor, and uses a local transporter to deliver their product to a small scale miller or processor, who then sells product to vendors and traders. There is enormous potential, and this is he future for our continent, but all of us in the industry need to support the development of the medium scale farmer.
6) What surprises you about this sector?
On a positive note are the innovative solutions by small players in the industry, on a negative note, is the lack of tangible and effective involvement by governments to support the industry.
7) You are a speaker at the upcoming Agri Business Congress East Africa – can you give us a preview of what your message will be?
Getting the basics right and on time!
8) Anything you would like to add?
Get it right and figure out whatever you are doing before you go big. We still see too many investors wasting good money because the have not fully understood the market place or the crop that they are growing.