When you think about doing business in Africa, sectors like agriculture, mining, ICT, retail, or property may quickly come to your mind. Today, I want to give you slightly different insights. I want to tell you more about how you can mobilize rural communities and commercialize 4 plants that grow wild in Africa. All four can be found in the wild and the plant parts that are valuable as commercial products, can hence be freely collected for processing. Having said that the first three plants that I want to introduce today, can also be planted as cash crops or planted at the edges already existing agricultural plots to generate additional income. Let’s have a look- shall we?!
1) Palm 0il production for a fast growing market
Palm oil is a billion Dollar business worldwide. It is among the most widely used edible oils in Africa and is globally used in processed food products and in the cosmetic and hygiene industry. The oil palm originated in the tropical rain forest region of West Africa. The main belt runs through Cameroon, Côte d’Ivoire, Ghana, Liberia, Nigeria, Sierra Leone, Togo and into the equatorial region of Angola and the Congo, where they still grow wild today and are used by small scale farmers. Nigeria is the only country that has really managed to commercialize it significantly.
However, Africa today is contributing only a tiny percentage of world production, and as the demand will increase and major producers such as Indonesia and Malaysia have very much reached their maximum capacities, the world will look towards Africa for palm oil production. So much so that large plots in Africa have already been bought and leased by powerful foreign investors, and for that reason, the large-scale production of palm oil is one that usually is accompanied by lobbying efforts that raise awareness about environmental degradation of forest resources and land grabbing from local communities.
Processing oil palm fruits for edible oil has been practiced in Africa for thousands of years, and the oil produced is an essential ingredient in much of the traditional West African cuisine. The traditional process is simple, but tedious and inefficient.
There are several ways, in which you can monetize palm oil production in Western Africa and run an ethical business. Here are a couple of ideas:
Start a Cooperative: You are gathering small scale palm oil producers together, build a cooperative, and provide support and possibly some equipment. The farmers in the cooperative will sell to you at a better price than they earned before, as you want to create motivation and a win-win situation. This way you can buy and sell the oil in bulk without planting yourself. You will need to look for communities who very actively produce for subsistence and local markets.
Sell palm oil production equipment locally: Palm oil production will most certainly increase, in particular in West Africa, and there will be a greater emphasis on medium and larger scale projects. Trading related equipment across Western Africa for ethical medium-sized enterprises could be a viable business.
Niche: There is red palm oil, but there is also coconut oil made of the meat or kernel of matured coconuts. Producing such oil for the hair and beauty industry may be a valuable niche considering that this industry is a very dynamic billion Dollar industry in Africa.
If you want to find out more about palm oil production, read a wonderful blog post by my business partner John-Paul here: Red Palm Oil – How to make money from this curative, but overlooked business.
2) Aloe Vera – step into Africa’s cosmetic industry
Aloe vera is another plant widely found in Africa’s drylands. Extracts from A. vera are widely used in the cosmetics and alternative medicine industries, being marketed as variously having rejuvenating, healing, or soothing properties. Although it has great market and export potential, it is hardly collected or commercially produced in Africa.
Aloe vera production is an excellent niche to get into, because the cosmetics and beauty industry in Africa is growing and when you produce aloe vera gel you may be tapping into a young industry trend unfolding across national and regional markets in Africa.
There are several ways to start production: If you have money to invest or a plot of land it can be commercially grown and processed with imported machinery. Have a look at the video below of a Aloe vera producer in South Africa, called Aloway. The video was shot at the end of 2012 and at that time the company claimed to be the first of its kind in Africa. I am sure not many more – if any at all – have joined since.
But production can also take place at small-scale using pots around your house. It takes about 2 years to grow them. Or you build a collection network of people in rural areas where the plant grows wildly and abundantly. In fact, Aloe vera can even be planted around traditional crops to generate additional income.
You could then start extracting the gel manually and sell smaller amounts to the local beauty industry – for example a local entrepreneur who produces creams, shampoos, or soaps. Alternatively, you can produce your own Aloe vera beauty or alternative health care product for the African market. It’s a rare niche, but one you will surely own with no or little competition for some time. There are many interesting YouTube videos available in this regard to get you going, including home grown Aloe vera utilization.
3) Gum Arabic for Africa’s growing food industry and bakeries
Gum arabic is one of the world’s most common gums with the longest history. Gum arabic is widely obtained or tapped from Acacia senegal trees, from which pieces of bark are removed to form wounds. The gum exudes in the form of small droplets on the wounds that steadily grow in size until they become nodules of 2-5 cm diameter. These nodules are ready to be picked for sale after about 4-6 weeks. Subsequent pickings are available at intervals of 1-2 weeks. Today, gum arabic is harvested in the gum belt of Africa, in nations such as Chad, Eritrea, Ethiopia, Kenya, Mali, Mauritania, Niger, Nigeria, Senegal, Tanzania, Uganda, Zimbabwe, and in the Sudan. It is then usually dried or aged for one year before being processed into spray dried powder.
Gum arabic is mainly used in the food industries, particularly confectionery, which uses about 60% of world consumption. It is also used in flavorings and in pharmaceutical preparations as a building and emulsifying agent. Other industrial products that use technical grades of gum arabic include adhesives, textiles, printing, lithography, water colours, paints, paper sizing and pottery glazing.
It is a great ingredient for both national, regional, and international markets – with international market providing possibly the best opportunities, as the industries that use them are very well developed and the ingredient cannot be sourced widely.
Sudan is a top producer for gum Arabic producing a staggering 80% of the world’s market offering one of the best qualities. The acacia trees have been planted for years across the country to protect crops from desert sand encroachment. But I do not necessarily advice you to trade in the Sudan, as large part of the trade are owned and strictly overlooked by government cooperations, which can make a start-up venture very challenging. Although insiders told me it has now been largely privatized, but corruption is ripe.
Other countries that are regarded to have a great potential to work towards similar quality are in the Sudano-Sahelian zone of Africa such as Chad, Nigeria, Mali and Senegal. But quite frankly operating in some of those markets is not an easy undertaking. Nigeria is another major producer of gum arabic, but production has declined. Partly responsible for this may be the fact that large parts of the production are taking place in the North, where a lot of political instability has been taking place – but Western Nigeria may offer some opportunities. Senegal seems a good option, and possibly Ghana or Tanzania – both countries may may have less tree density, but are vibrant economies with a relatively easy and less risky business environment.
If you own agricultural land in any African dryland region, you may consider to integrate Acacia senegal or A.sayal on the edges of your crop. This will protect soils and in a few years provide you with additional income from gum production.
4) Prosopis – a fodder production secret in Africa
Now, this one is still a well kept secret. I wished it wasn’t, because we could solve so may problems in Africa. I happen to know quite a bit about the plant – I wrote my PhD about it in 2008 in a context of food security and rural development in Eastern Africa.
In simple words: Prosopis juliflora also named mesquite is a thorny and highly invasive shrub in dryland Africa. It has been introduced to Africa largely in the 70ies and 80ies, because it just grew despite droughts, but now it is invading grazing areas and agricultural land aggressively destroying the native plant species. In short, most farmers and herders hate it, and governments don’t know what to do with it, because when you try to eradicate it – and millions of Dollars have been spent on that – it just grows back stronger and thicker than before. I could write obviously a lot about how Propsopis can be used commercially, but in this article I want to focus on the fruits. You can grind dry Prospis pods into powder, which can be sold as a highly nutritious supplement to animal fodder. This will go a very long mile in Africa’s livestock and meat production industries, as the shortage or high cost of fodder is a huge obstacle.
Now the secret lies in the fact that the pods are highly nutritious, but the problem is that animals eat them in a raw form off the trees and because the pods have a very strong coat it causes clogging of the animals’ intestines. As a result many animals get ill or even die, hence local communities have yet another reason to dislike the plant. But because it is alien to Africa, people don’t know how to use it efficiently. In South America for example, where the plant is native, indigenous communities grind the pods pods and use it for fodder production and even bake bread and cake for human consumption from the flour. I wished this knowledge was widely available among communities that often face shortage of food.
Propsois cannot be planted, as it quickly grows out of control. This is why it has today become a weed across many African countries. In Ethiopia’s Awash region for example it has invaded million of hectares, so much so that the land has been lost and cannot be utilized for grazing or farming, which has terrible consequences for local communities. But the pods could be collected in tonnes….processed, and sold as fodder supplements. Why don’t you start a pilot for your business in an African village surrounded by the tree?
I hope you feel inspired to start small and potentially grow this into a powerful business with great community impact!
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