Feed the Future Nigeria Agribusiness Investment Activity

Overview

The five-year USAID Feed the Future Nigeria Agribusiness Investment Activity aimed to strengthen the business enabling environment for agribusiness finance and investment through the promotion of greater private sector investment in agriculture. Thanks to strong relationship-building between government, private sector, and financial stakeholders, the Activity successfully catalyzed over $244 million of finance and investment for over 18,400 micro, small, and medium enterprises (MSMEs), all without relying on grants. By facilitating connections between actors and promoting sustainable and modern agricultural practices in key value chains, the Activity ultimately increased the depth, breadth, dynamism, and competitiveness of Nigeria’s agribusiness sector, boosting food availability, affordability, and long-term food security and nutrition.

From December 2018 to 2023, the $15.7 million activity, led by Cultivating New Frontiers in Agriculture (CNFA) and in partnership with J.E. Austin Associates and Connexus Corporation, sustainably connected thousands of MSMEs and producer organizations with key commercial players in five targeted value chains. Through streamlined regulations, better policies, improved practices, and increased finance and investment, the Activity enhanced the competitiveness and profitability of agricultural enterprises of all sizes. The overarching goal was to improve Nigeria’s agribusiness investment climate, which is crucial for attracting both foreign and domestic investment, leading to greater resilience for agribusinesses and Nigerian farmers.

Click the link here to learn more about how the Activity was able to impact thousands of agribusinesses across Nigeria.

Approach

The Feed the Future Agribusiness Investment Activity adopted a “lead firm” approach, engaging directly with well-established private-sector agribusinesses to support their growth and expansion. The Activity connected thousands of MSMEs and producer organizations with high-performing commercial actors across various value chains, enhancing competitiveness and returns through improved policies, production practices, and increased financial flows.

Simultaneously, the Activity worked with financial institutions to understand their financial products for agribusinesses, and then linked them directly with promising MSMEs that wished to expand. The Activity accompanied these agribusinesses throughout the application process and made sure they were “investment ready” for financial institutions and potential investors.

The Activity also worked with public and private sector stakeholders on needed legal, regulatory, and policy reforms to facilitate the growth and expansion of Nigeria’s agribusiness sector. These policies were drafted after numerous consultations with stakeholders directly affected by the reforms. Once these policies were approved, the Activity continually worked with policy implementers to effectively transfer ownership of the policies and introduce them to monitoring tools that would enable positive progress.

The Activity focused on the following five value chains: rice, maize, soybean, cowpea and aquaculture. Furthermore, it focused its intervention on the following seven states: Benue, Cross River, Delta, Ebonyi, Kaduna, Kebbi and Niger.

The Activity’s strategy delivered results across the following key pillars:

1. Improve the Agribusiness Enabling Environment: The Activity focused on reviewing and reforming key agricultural policies at both the state and federal level. With USG assistance, 22 agriculture-enabling policies and 68 consultative processes led to more efficient industry practices, reduced compliance costs, and simplified business functions within targeted value chains.
2. Broaden Access to Agribusiness Finance: The Activity improved access to finance for agribusiness MSMEs by engaging both the supply and demand sides of the agricultural finance market, focusing on expanding lending through financial institutions. This effort catalyzed over $188 million in debt financing, benefiting 17,716 MSMEs with agriculture-related credit.
3. Facilitate Investment for Agribusinesses: Collaborating with financial institutions and investors, the Activity provided technical and advisory support that catalyzed over $55 million in equity investments for agribusinesses. This enabled 721 MSMEs to receive investment and grow their respective operations.
4. Enhance Agribusiness MSME Performance: The Activity selected 50 MSMEs to improve their overall performance and make them more attractive for financial institutions and investors. Through organizational performance improvement interventions, these MSMEs adopted good agricultural practices, met financial institutions’ risk criteria, and became investment ready. Additionally, 93% of supported MSMEs showed improved performance thanks to these interventions.

Overview:

With $176 million in exports in 2015, the hazelnut is Georgia’s highest earning agricultural export and supports the livelihoods of over 40,000 families. However, the stability and profitability of the hazelnut sector, as well as the incomes of the smallholder farmers who depend upon it, are being threatened by the rapid growth of a pest known as the Brown Marmorated Stink Bug (BMSB).

Originating in China, the BMSB is devastating the hazelnut sector by reducing the quality and quantity of hazelnut kernels. Left uncontrolled, the BMSB could set the country back years of agricultural growth and development in other sectors including apples, corn, grapes, peaches, and vegetables.

To address these challenges, the USAID Restoring Efficiency to Agriculture Production (REAP) project received an additional $3 million to provide technical assistance and equipment to Georgia’s National Food Agency (NFA) between April 2017 and September 2018. By working closely with the Government of Georgia to develop a State Program with a focus on monitoring and managing the BMSB’s growth, REAP strengthened the capacity of local institutions to limit the agricultural losses caused by the pest. REAP’s efforts also helped the Government of Georgia better understand the BMSB’s biology to better inform management of the infestation.

Program Approach:

1. State Program Development Support: In partnership with local and U.S.-based entomologists, REAP managed the design and oversight of the Government of Georgia’s action plan through its local Working Group, spearheaded by the NFA. The Working Group was used to develop an implementation strategy, define the monitored area, and calculate the budget of the State Program to combat the infestation;
2. Communications and Outreach: Because the BMSB was new to Georgia, it was crucial to increase awareness and understanding amongst Georgian farmers, citizens, and extension agents before any monitoring and management strategies could be implemented. In cooperation with the NFA, REAP developed communications materials to educate citizens, District Task Force staff, and other public and private extension agents about BMSB management. A Geographic Information System (GIS) mapping platform augmented the approach, visualizing data for the NFA and general public to track BMSB and other pests;
3. Training: To prepare Georgia’s Ministry of Agriculture for the monitoring and management the BMSB, REAP delivered a multi-faceted training program on BMSB identification, trap establishment and maintenance, and the safe use and application of pesticides;
4. Local Capacity Building: Experience in the U.S. and Europe indicated that the invasive BMSB will be present in Georgia for an extended period of time. To ensure that the Government of Georgia is able to manage the BMSB in the present and future, REAP worked with the Ministry of Agriculture to outfit local NFA staff and entomologists with awareness, monitoring and management through local research and a capacity-building trip to the United States;
5. Procurement Support: To equip the Ministry of Agriculture with the tools necessary to monitor and manage the BMSB, REAP worked with the NFA to procure the required equipment to implement the State Program, such as traps, lures, and spraying equipment.
6. Private Sector Engagement: In order to manage the infestation, CNFA partnered with Trécé Inc, a US-based leading-edge research and development provide latest solutions in insect population monitoring and control.

Across Egypt, many farmers struggle with low productivity, poor quality of produce, and post-harvest losses, resulting in a significant loss in income. Even when crops are healthy, pests can destroy a large part of the harvest, incorrect harvesting techniques can bruise fruits and vegetables and packaging can impact the quality of the produce.

Shaaban Mohamed Ghallab, a farmer in Esna Village, Egypt, previously grew onions solely for his family’s consumption at home. Despite having an interest in expanding his production and selling beyond his home, he lacked the know-how in post-harvest handling to make the change.

The ICT platform sent daily text messages to farmers on agriculture best practices in Arabic

Shaaban is just one of 132 onion farmers participating in the Feed the Future Egypt Food Security and Agribusiness Support (FAS) project that received hands-on technical training to acquire the knowledge and skills on post-harvest handling techniques as well as daily SMS text messages that serve as a timely reminder to follow through on practices learned during training.

Over the course of four weeks, participants were trained on best practices for the harvesting, sorting, and packing of onions and tomatoes for local and export markets. Key messages included; ensuring good hygiene during harvest and handling, minimizing irrigation directly prior to harvest to ensure strong stalks and prevent new root germination, integrated pest management to minimize damage from rats and crows, and proper drying of onions post-harvest. Shaaban was selected as a lead farmer, meaning he applied the best practices from the training and provided advice to farmers both in the program as well as in the broader community. As a trusted voice, farmers often looked to Shaaban for recommendations and reassurance regarding agricultural practices. “Farmers would call me and say, ‘Do we add this amount of fertilizer? Or, do we follow this practice? Yes or no?’” he said.

The FAS project also developed an information and communications technology (ICT) platform with the support of Souktel Digital Solutions to send follow-up text messages to all participating farmers. These messages were sent to remind farmers of best practices to follow leading up to harvest time as well as during harvest time to prompt farmers on how to maintain quality produce and how to correctly package produce for the markets. “Since most everyone has a phone and we do not have the ability to visit each farmer in-person daily, because of the distance in rural areas, this is an easy way to reach the farmer with key knowledge,” said Mahmoud El-Rady, the FAS Post-harvest Coordinator responsible for queuing up the messages in the system. “The SMS messages are written step by step as if someone is sitting right by the farmers side in the field,” he said.

In Shaaban’s case, one of the important reminders he received was right at harvest time, when the onion was ripe and ready to be picked. “They sent messages about how to look at the fruit and understand whether it is the right time to pick it and what is the right amount of water to give it at a specific time around harvest so it is not damaged. This is sensitive timing when every minute counts and we can’t always wait for someone to come to the field,” said Shaaban. As a lead farmer, Shaaban also encouraged other farmers to open the messages since they contained helpful information.

Since the launch of the platform, more than 4,800 messages have been sent to participating farmers that produce tomatoes, onions, and grapes. Recently, the FAS project began creating content surrounding post-harvest best practices for the cultivation of mangos. Since the platform has proven to be an effective method for communicating with farmers, this tool is being expanded to send messages on agricultural best practices during production as well as to share lessons on nutrition, particularly with women in the agro-processing workforce.

In his first year of working with the FAS project and producing onions for market sale, Shaaban sold 45 tons of onion, making a profit of 27,000 Egyptian pounds (~1,511 USD). Since Shaaban and his family were living with two other families, he used the profit from his onion sales to help purchase a new home for his own family. “I was very happy because my first goal was to just get the training on onion [production]. I did not expect that I would also get this profit,” he said. Shaaban is now looking to take the skills he’s learned and expand his farm to plant other crops that reap high profits, such as hibiscus, in addition to continuing with the production of onion.

The FAS project supported the Negoaa Mazen agriculture cooperative, based in Sohag governorate, to complete an export contract with ELI company, an Albanian exporter, in which the cooperative sold 45 Metric Tons of high quality onions to ELI. This was the first time an international exporter directly contracted a cooperative without its own packhouse facilities. This success demonstrates the potential a well-managed cooperative has for negotiating and organizing member farmers to deliver on contracts. The elimination of middlemen in this exchange both increased prices available to farmers, and improved information exchange by creating a direct link between farmers and an export market actor.

The onions were sold at a competitive price of LE 5000 per Metric Ton, amounting to a total transaction value of LE 225,000 that is about 10% higher than would otherwise have been available to the farmers for onions of similar quality.

This successful contract between Negoaa Mazen agriculture cooperative and ELI is part of the FAS project’s overall objective to increase smallholder farmer incomes by facilitating opportunities for farmers to sell horticultural crops to export markets. One strategy the project follows for achieving this is to build and encourage formation of new relationships through trade show participation. At the Fruit Logistica Trade Fair in Berlin in February 2019, FAS project had the opportunity to connect with numerous international exporters such as ELI and encourage them to connect with cooperatives and associations with whom the project works, such as Negoaa Mazen. By helping to forge relationships between the buyer and local supplier, the FAS project empowered the Negoaa Mazen Cooperative to negotiate sales terms, and to contract neighboring groups to help them meet buyer demand.

The Negoaa Mazen Cooperative was established in 1962 in Sohag Governorate.  It offers agriculture and marketing services to around 2,000 smallholder farmer members, who collectively own 2,000 feddans of land, about 200 feddans of which are owned by women. Crops include green beans, wheat, onion, sugar cane, and clover. The FAS project provided technical support and regular monitoring for cooperative members to help improve their crop yields and ensure that their product would meet export quality standards. Training and technical assistance included fertilization programs, irrigation, integrated pest management (IPM), and best practices for harvesting. The project also advised farmers on good input supplies to improve product quality and increase their productivity.

In addition to providing the cooperative with technical support on production, the FAS project built Negoaa Mazen Cooperative’s capacity to both maintain high standards of product quality in compliance with exporter requirements, as well as to negotiate suitable contract terms. The FAS project also worked with both parties to help them comply with domestic regulations and manage logistics such as connecting with a local shipping company to export the onions. “We gained experience dealing with the international market, became aware of international standards required by this exporter, and were trained on the proper handling of onion for export by the project,” said farmer Ahmed Saleh, Chairman of Negoaa Mazen Cooperative.

Overview:

The USAID-funded John Ogonowski and Doug Bereuter Farmer-to-Farmer (F2F) Program (2018-2023) is implemented by Cultivating New Frontiers in Agriculture (CNFA) in Southern Africa (Madagascar, Malawi, Mozambique, Zambia and Zimbabwe) and the Eastern European country of Moldova. CNFA’s current F2F program aims to connect 394 mid-to senior-level U.S. volunteer experts with farmer groups, agribusinesses, trade associations, agricultural finance providers and other agriculture sector institutions to facilitate sustainable improvements in food security and agricultural processing, production and marketing.

The F2F Program was initially authorized in the 1985 Farm Bill with the primary goal of generating sustainable, broad-based economic growth in the agricultural sector through voluntary technical assistance. A secondary goal is to increase the U.S. public’s understanding of international development issues and programs as well as international understanding of U.S.-sponsored development programs. For more information on the activities of the program worldwide, please visit https://farmer-to-farmer.org.

Volunteers:

CNFA recruits highly-trained, exceptionally qualified volunteers — with years of experience in their respective fields — who offer their time and energy to provide technical assistance to farmers and entrepreneurs. Volunteers should be U.S. citizens or permanent residents. See our Volunteer Page for more information on how to become a volunteer.

Program Approach:

CNFA’s approach builds on USAID’s continuous learning from the F2F program since its 1985 inception and CNFA’s decades of experience in F2F implementation. In each country, focal value chains are analyzed to identify critical leverage points for improvements in incomes and food security through volunteer technical assignments.

1. Increase Agricultural Sector Market-Driven Productivity and Profitability: The Program promotes the adoption of innovative agricultural techniques and technologies and supports improved marketing and business skills.
2. Improve Conservation and Sustainable Use of Environmental and Natural Resources: The Program leverages conservation agriculture and other practices to produce higher and more stable yields while reducing environmental degradation.
3. Expand Agricultural Sector Access to Financial Services: The Program’s efforts strengthen the financial management and business-planning skills of farmer organizations and agribusinesses.
4. Private Sector Engagement: The Program also partners with government and private sector stakeholders and supports organizational development by building local markets and networks.

Overview:

The $8.5 million, four-year (2014 to 2018) Agricultural Support to Azerbaijan Project (ASAP) increased the incomes of agribusinesses and agricultural producers to accelerate the development of Azerbaijan’s non-oil economy. To accomplish this, CNFA increased access to finance using local Business Services Providers (BSPs) to grow and expand exports of agricultural entrepreneurs, promoted improved production practices through strengthened extension services, facilitated a favorable business enabling environment and expanded dialogue and the use of analytical tools and training.

Approach:

ASAP was built on the successes of USAID’s support to agricultural producers and processors in Azerbaijan over the last 15 years. Various activities strengthened the ability of domestic producers to meet international quality standards, increase exports and yield better supply and domestic market demand, in turn boosting employment and incomes. ASAP targeted value chains with the highest economic potential including hazelnuts, pomegranates, orchard crops and vegetables. Activities specifically yielded these results:

1. Increased Technology Adoption: ASAP assisted growers and processors to adopt new technologies and techniques to increase the quality and quantity of production.
2. Supported Increased Sales: Through ASAP, CNFA facilitated increased exports and enhanced domestic marketing through more rigorous food safety systems, packing and post-harvest methods.
3. Facilitated Business Connections: ASAP’s activities strengthened the linkages among actors in the respective value chains and fostered cooperation through strengthened industry associations.
4. Bolstered the Quality of Services Provision: The project built the availability, quality, capacity and sustainability of BSPs and public and private extension services.

Overview:

The USAID/Georgia Restoring Efficiency to Agriculture Production (REAP) activity was a five-year (2013-2018), $19.5 million enterprise development activity that increased income and employment in rural areas by delivering firm-level investment and tailored technical assistance to Georgian agribusinesses. Since October 2013, REAP increased private investment and commercial finance in the agriculture sector by $37.5 million, mitigated risks for rural agribusinesses, upgraded farmers’ agricultural and technical skills and expanded commercially sustainable linkages between service providers, producers and processors.

Approach:

1. Small and Medium Enterprise (SME) Development in the Agriculture Sector: By utilizing its $6 million grant fund, REAP partnered with 70 agribusinesses to launch profit centers that provide input supply, services, technical trainings and commercial markets to smallholders. REAP’s investment portfolio, consisting primarily of Farm Service Centers (FSCs) and Machinery Service Centers (MSCs), created over 2,000 new rural jobs, provided over $18 million in new cash markets, trained over 200,000 smallholders and generated new gross sales of over $182 million.
2. Implemented Technical Assistance Program: To ensure the sustainability of REAP investments and bolster the capacity of Georgia’s agriculture sector, the activity worked closely with its partners to deliver demand-driven, customized technical assistance in collaboration with the private sector to improve competitiveness, increase sales and foster professional development. REAP also supported non-grantees—enterprises that did not meet the competitive benchmarks to receive matching grants—by providing capacity-building consulting through local BSPs and International STTA on a 50-50 cost-shared basis to increase access to funding.
3. Focused on Gender: REAP ensured inclusive enterprise development and involved men, women and youth in its activities. All C1 grant applicants were required to present a gender integration strategy as part of their proposals. REAP expected at least 15% of grantees and 25% of trainees to be women.
4. Improved Access to Finance: REAP stimulated affordable financing by working with both financial institutions and agribusinesses, providing technical assistance to improve supply and demand. Through business plans, agriculture lending strategies and training for loan officers, REAP increased the volume of lending to the agriculture sector.
5. Improved Workforce Development: REAP had a robust internship program that allowed over 120 students to work in fields that support REAP’s implementation, including administration and finance, monitoring and evaluation, environment, access to finance and technical assistance. REAP also offered 11 research grants for students committed to addressing constraints faced in Georgia’s agriculture sector, including an additional nine who focused on Brown Marmorated Stinkbug (BMSB) research.
6. Focused on the Environment: All grant applicants were visited by REAP’s Environmental Specialist and provided with environmental review checklists and guidance on environmental compliance.