Africa's New Breadbasket? Zambia Is Rapidly Gaining the Reputation as the Country of Choice for Investments into the Agricultural Sector. Food Output Is More Than Double the Demand and Could Soon Become a Major Export Earner. Tom Nevin Reports

By Nevin, Tom | African Business, December 2010 | Go to article overview

Africa's New Breadbasket? Zambia Is Rapidly Gaining the Reputation as the Country of Choice for Investments into the Agricultural Sector. Food Output Is More Than Double the Demand and Could Soon Become a Major Export Earner. Tom Nevin Reports


Nevin, Tom, African Business


Long regarded as the poorer cousin of its South African and Zimbabwean regional counterparts, Zambia is fast gaining attention as a desirable destination for agricultural investors, and is becoming a serious challenger for the epithet: 'Africa's new breadbasket'.

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The southern African country has not escaped the agri-scramble for Africa and investors are finding it one of the more desirable land acquisition and development targets on the continent. Private land buyers and developers are coming in numbers from Britain, South Africa and Zimbabwe, and from the Middle and Far East, US and Europe. Other funding, both private and institutional, is being channelled into agri-processing infrastructure development and transport.

About 200 exiled Zimbabwean farmers have taken leases from the Zambian government to develop farmland in the country, while others are arriving from South Africa and further afield. A delegation of Indian commercial farmers arrives in December. Their itinerary includes a tour of Zambia's developed and undeveloped land, and discussions with Ministry officials and finance and industry leaders. They could be the vanguard of a growing influx of interested parties drawn to the country by the UN Food and Agriculture Organisation's contention that if Zambia could equal agricultural activity in Kenya, a country where two thirds of the land is semi-arid, output would amount to $1.5bn a year, equivalent to 10% of Zambia's GDP. The sector's current contribution is about 1%.

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Zambia's agri-production potential is phenomenal, especially at a time when industrialised nations worry about feeding their populations and are scouting the world for additional sources of nutrition. Of the country's total land area of 752,000k[m.sup.2], some 420,000k[m.sup.2] is classed by the FAO as having medium to high agricultural potential. But, says the World Bank, only 15% of arable land is cultivated.

Indicative of the land's yield potential, the 2009/10 season's maize harvest satisfied domestic consumption more than twice over, says the International Trade Centre in Geneva. Of a total maize harvest of 2.8m tons, just 1m tons was consumed domestically. When the carryover stock from the 2008/09 season is added, Zambia's maize holding exceeds 3m tons. Much of the surplus is being sold to Namibia, Democratic Republic of Congo and, ironically, Zimbabwe. Says Dr Anthony Mwanaumo, executive director of Zambia's Food Reserve Agency (FRA), a government department responsible for purchasing, stocking and exporting farm produce: "We are not only delighted to meet the needs of our nation but also to have capacity to assist our fellow African economies in our collective interest of creating food security across the continent."

About 82,000t of the surplus was shipped to Zimbabwe in September, much of it grown by Zimbabwean farmers now living in Zambia, reports Elias Mbao in Kenya's Africa Review magazine. In mid-October Standard Chartered Bank announced a $26m loan to the FRA for the purchase of about 470,000t of maize from 300,000 Zambian small-scale farmers. The funds will be used for seed, equipment and replanting for the 2010/2011 season. In tune with Zambia's increasing agricultural output, the agri-processing industry is expanding exponentially, much of the demand created by the country's rapidly growing middle class, itself fuelled by the national economic rebirth.

One of the companies leading the growth spurt is Zambeef, a burgeoning food company. Twenty years ago, the firm was a small abattoir and butcher's shop in Lusaka. Today it is among SSA's biggest meat producers, turning over $350m annually and slaughtering 60,000 cattle and 3.5m chickens a year.

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"The Zambian government is very supportive--and they aren't looking for backhanders," said Zambeef's chief executive Francis Grogan. …

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Africa's New Breadbasket? Zambia Is Rapidly Gaining the Reputation as the Country of Choice for Investments into the Agricultural Sector. Food Output Is More Than Double the Demand and Could Soon Become a Major Export Earner. Tom Nevin Reports
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