UK agribusiness impact investor AgDevCo has announced a $3 million investment in Tradin Organic, the Netherlands based organic ingredients company to source cocoa directly from certified small-holder farmers in Sierra Leone linking them to manufacturers in Europe, the United States and Asia. The company’s $3 million revolving credit facility will allow Tradin to purchase cocoa at premium prices from up to 20,000 certified farmers in the West African country.
Tradin began operations in Kenema Sierra Leone two years ago and successfully developed a network of trained buying agents ensuring that every bag of cocoa purchased can be directly traced to the farmer from whom it was bought. This investment, a first for AgDevCo in Sierra Leone, will benefit a region that was severely affected by the 2014 Ebola crisis and a country that suffered significant setbacks during a decade long war.
Before the war, cocoa was one of Sierra Leone’s major export crop but that changed after as most farmers fled their villages during the war. Others were killed and their farms destroyed, along with generations of knowledge about cocoa farming. By the time the war ended the country’s cocoa export had dropped by over 60 percent. Since then the country has strived to revive its cocoa production industry and boost its value chain and competitiveness through different programmes and strategies.
In 2014, these efforts suffered a setback with the Ebola outbreak which forced international cocoa companies to stop buying operations, leaving the new generation of cocoa farmers with limited access to the global market. But with investments like AgDevCo’s, these farmers get new opportunities with an improved business environment and international market linkages.
With AgDevCo’s support, Tradin will continue to develop a network of farmer field schools, a project launched in November 2018 to help farmers boost productivity and improve their yields by providing education on improved farming methods like new harvesting and fermenting techniques. Through this investment, both companies hope to revitalise Sierra Leone’s cocoa sector where cocoa export volumes have remained stagnant over the past decade, despite enormous potential.
Last month, AgDevCo invested $3 million in Rwanda’s maize milling company, Minimex Limited, building on a portfolio that already comprises Kigali Farms, a mushroom grower; and Uzima, a day-old chick producer.
AgDevCo is a specialist investor in African agribusinesses with a portfolio consisting of over 50 investments in production, processing and distribution. Across Sub-Saharan Africa, AgDevCo has invested $150 million to date with more than 50 companies linking over 480,000 smallholder farmers to profitable markets. The company is headquartered in London with representative offices in eight African countries including Ghana, Malawi and Mozambique.