AGRA, UPL launch initiative to boost Africa cold storage capacity at WEF in Rwanda

The Alliance for a Green Revolution in Africa (AGRA) and UPL Limited, through a major public-private partnership have launched the “Million Tons of Cold Storage in Africa Initiative.”

The initiative aims to mobilise $2 billion in the next decade to set up cold storage facilities with a capacity of a million tons across sub-Saharan Africa.

The partnership aims to revolutionise African agriculture and bring it on par with the rest of the world through the creation of innovative supply chains and energy efficient cold storage systems.

Post-harvest losses, accounting for more than 40 percent of potatoes, fruits, vegetables and other perishables lost before reaching the consumers are a major impediment to the development and transformation of the African agricultural sector into the motor of economic growth that it should be.

These losses do not only amount to wasted resources and reduced returns on investment, but also impact negatively on food and nutrition security of many communities across the continent.

Speaking at the launch of the initiative on the sidelines of the World Economic Forum (WEF) on Africa 2016 in Kigali, Rwanda, Agnes Kalibata, president of AGRA, explained how the initiative would allow farmers to have greater flexibility in what they grow and in when they decide to bring their produce to the market, leading to more negotiating power for the farmers and ultimately greater incomes. “Most importantly, the initiative aims to substantially bring down post-harvest losses of potatoes and other perishables: today, more than 40 percent of these are lost in their journey from farms to fork,” said Kalibata.

Work on setting up three cold storage projects has already started in Kenya, Rwanda and Uganda. These projects, which are expected to be constructed and fully functional by the end of 2017, will be presented as a proof of concept and successful case examples of the proposed multi-partner consortium approach in setting up of viable cold-chains across sub-Saharan Africa (SSA).

About 400 million people in SSA, or about 65 percent of the population, depend on incomes from farming and related activities. Most of these are subsistence farmers who consume 60 percent of the output from their farms of two hectares and less, and earn on average under two dollars a day. The majority grow row crops and other low value crops, trapping them in a vicious cycle of low labour productivity and incomes.

“Even if these farmers could be convinced to grow other higher value crops through risk mitigation mechanisms such as insurance and market access, there exists an even bigger and seemingly insurmountable barrier. Currently, there are no functioning cold chains handling fresh produce at scale in most of Sub-Saharan Africa,” said Jai Shroff, CEO, UPL Limited.

In addition to post-harvest losses, lack of adequate cold storage facilities for crops like potatoes and onions force farmers in SSA to sell their products pre-maturely – mostly right after harvest when the prices are at their lowest.

The initiative aims to reach about 15 million farmers, over the next decade with the express purpose of benefitting nearly 100 million people through value addition and reduction in post-harvest losses.

These efforts will also help kick-start a new type of agriculture; one that allows smallholder farmers to transition from total dependence on growing row crops to a more flexible future where they have greater choice in which crops to grow and the opportunity to bring their produce to the market at a time of their choosing.