VDMA Report Analyzes Agricultural Machinery Markets and Climate Challenges in Algeria

VDMA Agricultural Machinery Association
Ear to the Market: Africa
Photo: wetteraukreis.de
Ear to the Market: Africa 2013/2014
Contact: janine.heimann@vdma.org Page 1
Table of Contents
Topic
Page
Algeria July 2014
Egypt June 2014
17
Zambia May 2014
29
Kenya April 2014
42
Nigeria March 2014
57
Angola February 2014
70
Tanzania January 2014
84
Ethiopia December 2013
97
Ghana November 2013
113
Zimbabwe October 2013
127
Mozambique September 2013
140
South Africa August 2013
154
Algeria July 2014
Algeria: Interviews
How is the mood in agriculture in the different African countries? What are the major developments? How is the situation on
the agricultural machinery markets? To answer these questions, we regularly speak to the managers of local agricultural
enterprises and to agricultural machinery dealers. This month, we took a closer look at the North African country Algeria.
Direct seeding on the rise
20% of Algerias farms are larger than 20 ha. Cereal farms of
hundreds or thousands of hectares are primarily located in NorthEastern Algeria in the area of Setif, Mila, Constantine and Guelma.
Some of them are private companies, others are pilot farms. Pilot
farms are state farms. There is nearly 180 of them in Algeria and
often they are as well as or even better equipped than the private
ones.
Said Mahnanes farm is a private farm located close to Setif. On 60 ha
he and his employees produce wheat, barley, oats and vegetables.
Like many other farmers in the region, he is currently very concerned
about the climate: For this year with the conditions of dryness, the
harvest is really bad. I will harvest nearly nothing. For the future and
with the climate changes, it is very complex to estimate the harvest
quantity. Currently the weather causes a big problem.
Said Mahnane on his farm
For Ahmed Boughendouze, the manager of a 1,700 ha farm producing

mainly wheat and barley, it has been the most difficult year in decades:
This year is a disaster. We have almost no harvest. Drought persisted
this year and lasted almost 70 days. I have spent almost 28 years on
this farm, but this is the most difficult year and the worst climate
conditions. Until early March the cultures were well developed but from
mid-March until now it is a disaster. So water is the big problem.
In order to better handle the droughts, which seem to have increased in
the past years, Mr. Boughendouze is planning to change to direct
seeding: My plan is to change the system. I plan to go to conservation
agriculture and avoid the one that is conventional. If we take this year:
between September and mid-May we scored 98 mm precipitation. As a
result we had a very small harvest. So if we want to take a strategy to
develop this sector, we need to take the example of this year. I
personally see these coming years to be the same as this season. So I
say to myself to better adapt to these conditions especially climate
changes. If we really think about how to successfully manage water
resources, then we must go to conservation agriculture. After that there
will be other perspectives, for example the choice of plant materials
that are more tolerant to drought conditions. Honestly there is no
philosophy that is brighter and we master the technical aspect.
Precipitation will not exceed 130 mm and with this installment well
never manage to produce good yields. So to overcome this, we must
turn to conservation agriculture - for example reduce and absorb all
costs and expenses associated with plowing, leveling So for this
purpose we will go directly to direct seeding, which will allow us a
better rationalization of water resources.
Algeria: Interviews
According to ICARDA (International Center for Agricultural Research in

Dry Areas) conservation agriculture has indeed made impressive
advances in Algeria. In the past two years, the adoption of conservation
agriculture has actually more than tripled.
Up to 60% subsidies for agricultural machinery investments

But not only the climate change currently influences the way farms are
operating in Algeria. Due to rural migration, some regions are
experiencing a dramatic lack of agricultural workforce. According to Mr.
Mahnane, especially in the past harvest seasons, the labor problem has
been huge as a large number of people has moved to the cities and/or to
activities other than agriculture. That has strongly increased the demand
for agricultural machinery, especially in regard to harvesting equipment.
Mr. Mahnane had to pay only between 60 and 70% of the total price for
his harvesting equipment among others a Claas combine harvester, a
reaper and a collector mower. The rest was paid by the state. In general,
the Algerian government subsidizes agricultural machinery investments
with 20 to 60% of the total sum. Recently, it strongly focused on
harvesting equipment, but also subsidies for other kinds of agricultural
machinery are possible. Normally only locally manufactured/assembled
machinery is eligible to subsidies. If there is no adequate local
alternative though, also imported products can be subsidized (this only
counts for new machinery - machines older than two years are not
allowed to be imported anyway.)
Ahmed Boughendouze and his farm lands
Algeria: Interviews
However, especially in comparison to the rest of Africa, there is actually

a fair number of tractors, combines and implements which are produced
or assembled locally. Claas and Same Deutz-Fahr produce combines
and tractors in Constantine and sell their machines under the names
Cirta (SDF) and Tessala (Claas). For tractors, the current production
capacity is 3,000 units. For its Massey Ferguson production, AGCO has
started a joint venture with two Algerian partners in Constantine only two
years ago. By 2017, they want to produce 5,000 tractors. Also the Indian
manufacturer ITL/Sonalika produces tractors in Algeria. Their machines
are sold under the name Algeria Solis.
Sometimes, the German brands are more or less double the price than
their Chinese or Indian counterparts but according to Mr. Boughendouze
many farmers are aware of the differences in quality: You find a tractor
120 million Centime from India, so that German is 200 million Centime,
but the most durable is the German equipment and the most profitable
despite its high expense. Mr. Mahnane adds: It is like the car market: if
I want to buy machinery, I look for the strongest like German machinery also to guarantee technical assistance for the machinery.
3,000 new tractors per year

A total of at least 100,000 tractors is in use in Algeria today as well as
approximately 9,000 combine harvesters. Azizane Haroune from Al
Tractors an Algerian-Tunisian company selling John Deere machinery
estimates that in a year approximately 3,000 tractors next to maybe
5,000 implements are sold. The brand environment he sees like follows:
The oldest and most dominant brand in Algeria is Deutz. After that, we
have the Cirta tractor which has been based on Deutz technology since
1973. After these two big brands, we have Massey Ferguson. Lately,
Chinese and Indian products such as Mahindra have been beginning to
dominate the market thanks to their low prices. Other common brands
in Algeria are John Deere of course, McCormick by AGCO, Farmtrac by
the Indian manufacturer Escorts as well as Cetor from the Czech
Republic.
Mr. Haroune from Al Tractors
Algeria: Interviews
Interviews
Ahmed Bougendouzes ag machinery park
Maintenance and technical assistance remain a major problem

And for many farmers this is exactly the crux of the matter. On Mr. Mahnanes farm, they have Cirta/SDF and Massey Ferguson tractors, a Claas
combine as well as a couple of implements from Italy and Spain. Mr. Mahnane explains: For me, the best brand is the one that allows me to see
and obtain spare parts, it is the one that ensures me after sales service. Why are we interested in Cirta? Because we master it well. If you have
damage, you can easily find the solution in terms of spare parts. We are exploiting what is easy and adaptable for us. So we prefer Cirta because
they have the best availability in terms of after sales service and spare parts. In contrast, for sowing, if you have a problem with a part, then the
spares are not really available. For my sprayers, for example, I was forced to change my supplier because I had issues with parts. So I went to
AXIUM (Hardi dealer) because they ensure maintenance after purchase and they always ensure parts availability of certain materials.
Algeria: Interviews
So at least to some extent, Mr. Mahnane has found ways to get to grips with the issue of finding spare parts for example by switching the brands
of his agricultural machinery. Still everything in regard to the actual repair of the machines represents a challenge to him and his employees: We
face great problems, we do not have the competence to fix the machinery. We can only make adjustments to the installation as well as the usage.
For example, if we have a machine that is broken down, currently it is big problem, we do not have the proficiency to repair it. So we do fix it
ourselves but this remains limited because of our lack of specialist knowledge.
In the opinion of Mr. Haroune from John Deere, many Algerian farmers feel like Mr. Mahnane: In Algeria, farmers are asking for a very simple
technology. Farmers first worry is a breakdown. Maintenance and technical assistance remain a major problem in the agricultural machinery
industry here in Algeria.
Said Mahnanes ag machinery park
Algeria: Agriculture
z
Agricultural production
}
Crop production:
z
Potatoes
z
Wheat
z
Dates
z
Olives
z
Grapes
z
Tomatoes
z
Onions
z
Chilies and peppers
z
Water melons
z
Apples
z
Oranges
z
Apricots
z
Vegetables
Animal production :
z
Cow milk
z
Sheep meat
z
Chicken meat
z
Cattle meat
z
Eggs
z
Sheep milk
Agricultural area
}
3,3 4,2 million t

2,6 3,4 million t
600.000 800.000 t
400.000 600.000 t
400.000 600.000 t
700.000 800.000 t
1 1,2 million t
380.000 430.000 t
1,2 1,5 million t
380.000 400.000 t
580.000 820.000 t
200.000 290.000 t
540.000 560.000 t
}
}
Total country area:

Agricultural land:
Arable land (in use):
2.381.740 sq km
17,4%
3,2%
2,1 2,4 million t

200.000 250.000 t
250.000 t
100.000 120.000 t
260.000 310.000 t
300.000 340.000 t
Algeria: Agricultural Machinery

Agricultural machinery import Algeria
in million Euro
200
Ag machinery import 2012
from World
from Germany
150
100
50
Tractors
Spraying & fertilizing
Soil cultivation
Harvesting
Seeding & planting
Irrigation
Transport
Not categorized/parts/others
Total
86,8 m
3,8 m
7m
24,5 m
3,8 m
7,2 m
0,8 m
46,3 m
180,2 m
0
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Source: Federal Statistical Office Germany
Import 2013 (preliminary):

269 million Euros (+ 49%)
Main origin countries of ag machinery imports
Algeria: Agricultural Machinery

z
Agricultural machinery dealers and manufacturers (selection) / agricultural region (in orange)
EURL Mixtrade (Claas

dealer), Algiers
AGCO tractor production,

Constantine
PMAT Direction Generale

(Massey Ferguson dealer),
Algiers
PMA / CMT tractor and

combine production under
license SDF (Cirta) and
Claas (Tessala),
Constantine
Firme Algerienne du
tracteur (New Holland
dealer), Algiers
SARL Al Tractors (John
Deere dealer), Algiers
Source: http://www.infoplease.com/atlas/country/algeria.html
Algeria: Fairs and Exhibitions

z
FIA - Foire Internationale dAlger

z
} May 2015, Algiers (anually)
} Organized by CFCIAF (Chambre de
Commerce et dIndustrie Algro-Franaise)
} http://fia.safex.dz/
Sipsa Agrisime & Sipsa-Agrofood

} May 2015, Algiers (annually)
} Organized by ExpoVet
} http://www.expovet-dz.net/
Agroexpo Siafil Filaha

} November 2014, Algiers (anually)
} Organized by ExpoVet
} http://www.expovet-dz.net/
Sud Agral
} December 2014, Biskra (annually)
} Organized by Krizalid communication
} http://www.krizalid-dz.com/Accueil.html
Algeria: Basic Country Figures

z
Economy
z
} GDP 2013: 216 billion USD (+3,1%
compared to previous year)
} GDP per capita 2013: 5.668 USD
} GDP agriculture (of total 2012): 8,4%
} Labor force: 11 million
} Employees in agriculture: 14%
} Inflation 2013: 3,9%
} Industries: petroleum, natural gas, light
industries, mining, electrical,
petrochemical, food processing
} Resources: petroleum, natural gas, iron
ore, phosphates, uranium, lead, zinc
} Ease of Doing Business: 152 of 185
} Global Competitive Index: 110 of 144
} Corruption Perception Index: 105 of 174
} Human Development Index: 93 of 186
Politics and state

} Capital: Algiers
} Administration: 48 provinces
} Head of state: Abd al-Aziz Bouteflika
} Government leader: Abdelmalek Sellal
} Minister of Agriculture: Abdelouahab Nouri
GDP
Foreign Direct Investment Stock
in billion USD
in billion USD
25
250
199 208
200
171
150
85
100
102
117
136
162
138
21,8
19,2
20
16,9
14,2
15
10
6,2
57
23,3
7,1
8,1
9,9
11,6
50
0
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Source: World bank
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Source: United Nations Conference on Trade and Development

z
Demographics
} Total population:
32 m
} Population density:
14 inhabitants per sq. km
} Population growth 2014:
1,9% (est.)
} Fertility rate:
2,8 births per woman
} Ethnic composition:
99% Arab-Berber, 1% Europeans
} Urban population:
73%
} Below 15 years:
28%
} Illiteracy rate:
27%
Languages
} National language:
Arabic
} Further languages:
French, Maziria, Berber
Religion
}
Major religion:
Islam
Minority religions:
Christianity (very small minority)
Currency
} Name of currency
Algerian Dinar (DZD)
} Exchange rate:
1 EUR = 107,82 DZD (07/2014)
Algeria: Contacts
z
Agricultural section of German Embassy in

Morocco (also responsible for Algeria)
} 7, Zankat Madnine, B.P. 235, 10 000
Rabat
} +212 537 / 21 86 00
} la-1@raba.auswaertiges-amt.de
GIZ Algeria
} Lotissement El Feth - Villa n 24
El Biar, Algiers
} +213 21 920988
} giz-algerie@giz.de
} www.giz.de
Chambre Algero-Allemande de Commerce

et dIndustrie (AHK)
} 11, rue Mohamed Khoudi, El Biar, 16000
Alger
} +213 21 92 18 44
} info@ahk-algerie.dz
} http://algerien.ahk.de
German Embassy in Algeria

} 165, Chemin Sfindja (ex. Laperlier),
Algiers
} +213 21 74 19 56
} www.algier.diplo.de
Egypt June 2014
Egypt: Interviews
enterprises and to agricultural machinery dealers. This month, we took a closer look at the North African country Egypt.
We rarely own agricultural machinery, we rent it from the

government
Magued Akhnoukh is the manager of a 85 acre farm focusing on sugar
beet and cane as well as wheat, maize and soya beans. All the harvest
is sold to governmental institutions such as the Principal Bank for
Development and Agriculture or state-controled agricultural
cooperatives. Mr. Akhnoukh explains: The government is the biggest
customer for us and for most farms in Egypt because wheat and those
crops are subsidised by the government. The government helps the
farmer by paying a bit more for wheat and maize. We are an agriculture
oriented country, if the government wouldnt support this area, then they
wouldnt be doing their job.
Also for agricultural machinery, Mr. Akhnoukh relies on the government:

In Upper Egypt, we rarely own agricultural machinery, we rent it from
the government. 95% of the farms do not have their own machinery but
they rent it from the government and the bigger farms maybe from
privates. I just send a deposit using my ID or I pay the full price
depending on how long I will need the machine. Per day I only pay a
deposit. The government then sends the machines which are suitable for
the land depending on its size and its location. We rent tractors,
harvesters, levellers, ploughs, planters and so many more. Every year
the brands are different. Most of the farmers do not really care about
brands though since the government would replace it if something goes
wrong with the machine. So farmers do not really worry about the
technicality of the machine. The process is made easy by the
government and it is really the only option a lot of the farmers have in
terms of having a mechanized farm. One machine costs more than the
net profit of a farm for a whole year given that we are not including spare
parts, maintenance and all the other costs.
Egypt: Interviews
The big companies go for the big names

Mahmoud Samir works for Golden Seven Egypts Massey Ferguson
dealer. With seven employees, the company has been operating in the
sector since 2011. The government only rarely belongs to their
customers it is rather the larger private farms which purchase Massey
Ferguson machinery: Our products are too expensive for the
government. The government only wants cheap machinery.
Mr. Samir basically sees four main customer segments agricultural
machinery dealers can focus on in Egypt: We have the main one which
is the government. Under the government we need to think of two
aspects. The first aspect is the fact that the government supplies a lot of
farmers in Egypt with machines. The second aspect is the fact that the
government actually owns some land and requires some machines for
that. To get the machines, they usually use bids. They put out a bid and
whoever they find the cheapest - biggest criteria - wins the bid. As
mentioned, this is usually other brands than Massey Ferguson.
Then we have the companies (customer segment number two). Those
companies are either big or medium or small. Big companies are Daltex,
Dima, Maghrabi, Sekem that are 1,000 acres and more. Medium
would be Marina, Raga, Shabrawi, Sudani 50 acres and up. They
dont necessarily own the land but they rent. This is where land
contracting happens: some owners just rent out land to farmers and then
they take percentage of the profit. By the way, not only the government
does bids for agricultural machinery - there are also big companies
which do bids and choose the best for them. But that would put into
account quality also - not like the government which only puts into
account the price.
And then you have the small farmers (customer segment number three)
with small land - families with ten acres or even less. Last you have the
contractors (customer segment number four) who buy used tractors and
machines and rent them to people. They usually only buy big brand
names like John Deere and Massey Fergusson. Often they get it from
abroad they only care about the brand name.
The customers of Golden Seven are primarily large-scale private farms.
The government, contractors and small farms are rather served by other
brands. In Mr. Samirs opinion, the most prominent brands in Egypt are
the Indians - primarily Mahindra with a tractor range of up to 80 HP - the
Chinese and also New Holland, which have been quite successful in
selling machinery to the government. In addition, Belarus is well rooted
in the market. They sell about 200 tractors per year primarily to smaller
farms. John Deere again is rather common too. Their clientele,
according to Mr. Samir, are rather the large farms which look for
machines with a minimum of 160 HP.
Sherif Yousef works for The Transorient Company - Egypts official John
Deere agent. Mr. Yousef confirms Mahmoud Samirs view: The
government is big but they usually go for cheap machines. Then there
are big companies that own land and they go for big names as they can
afford it. We usually sell to The Nile Company and a big company called
El Rakhaa which is Saudi Arabian. These are our two biggest clients at
the moment. Small companies go for the same brands that the
government goes for. Our personal clients are the medium to big
companies that are owned by foreign investors like the Saudi Arabians.
Egypt: Interviews
Per year, The Transorient Company sells about 50 John Deere tractors
between 90 and 220 HP as well as more or less 50 implements. To Mr.
Yousef, John Deere, New Holland and also Lamborghini have been the
most important brands in Egypt at least so far: Europeans are too
expensive for the market at the moment. The Asians are getting better in
terms of accessing the market as they are very price oriented and can
easily make prices very low. Therefore they are attracting the
government and the small lands which is more than 60% of the market
at this point.
Like many other Egyptians, also Mr. Samir from Golden Seven places
great hopes in Sisi: In the past three years everything has been on hold.
There have been no new land projects and therefore the market was
stagnant. Were waiting for president Sisi who promised he would start
to focus on agricultural projects. There are a lot of lands that could be
used for agriculture and in the past, the government used to help in
getting this done with projects. But for the past few years nothing has
happened. We are now hoping that president Sisi will start doing that
again. Therefore, the potential for the agricultural machinery market
could increase.
All hopes rest on President Sisi

Egypts agricultural sector - like basically the whole country - is currently
torn between a deep insecurity caused by the events of the past three
years and burgeoning hopes associated with the new president Abdel
Fattah al-Sisi.
The Egyptian Revolution took place in 2011 as part of the Arab Spring.
One of its results was the resignation of Muhammad Husni Mubarak,
who governed from 1981. Turbulent times followed. A Military Council
ruled until Mohammend Mursi took up his office only to be overthrown
again shortly after. Again a Military Council was implemented until last
month official parliamentary elections were held. These saw former
military chief al-Sisi as clear winner.
Mr. Akhnoukh, the cereal farmer, hopes that the new government will
finally bring a feeling of security to the sector: The mood is the general
mood of the country it is uncertain. If the government falls like in the
past couple of years, the industry falls. At this point everyone is hopeful
that the new government helps this industry back on its feet. In the past
three years, there has been insecurity because there are people who
have taken away the farms - criminals have been taking away the farms
from people ever since the revolution. The owners have zero to
minimum to do when this happens because of the lack of regulation. And
the police has been lacking involvement ever since the revolution. The
new government has been communicating that the security will be better
and hence everyone can be more relaxed. The last three years have
been a burden on everyone in this industry.
Mr. Yousef from The Transorient Company adds: I expect a big change
in the coming years now that president Sisi has taken over the
government. At least thats what I am hoping for.
Egypt: Agriculture
z
}
Crop production:
z
Tomatoes
z
Rice
z
Grapes
z
Wheat
z
Dates
z
Potatoes
z
Oranges
z
Onions
z
Sugar cane
z
Olives
z
Mangoes
z
Strawberries
z
Chilies and peppers
z
Sugar beet
Animal production:
z
Cattle meat
z
Chicken meat
z
Buffalo meat
z
Buffalo milk
z
Cow milk
Agricultural area
}
8,1 8,6 million t

4,3 5,9 million t
1,3 1,4 million t
7,2 8,8 million t
1,4 1,5 million t
3,6 4,5 million t
2,4 2,8 million t
2 2,3 million t
15,7 16,5 million t
390.000 470.000 t
600.000 790.000 t
240.000 t
650.000 670.000 t
7,5 9,1 million t
}
}
Total country area:

Agricultural land:
1.001.450 sq km
3,7%
2,8%
430.000 440.000 t
750.000 800.000 t
400.000 t
2,6 2,7 million t
3 3,3 million t
Egypt: Agricultural Machinery

Agricultural machinery import Egypt
in million Euro
120
100
from World
from Germany
80
60
40
Tractors
Soil cultivation
Harvesting
Seeding & planting
Irrigation
Transport
Total
34,5 m
8,4 m
4,9 m
10,7 m
0,6 m
2,9 m
0,2 m
47,6 m
109,8 m
20
0
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Import 2013 (preliminary):

96 million Euros (- 13%)
Egypt: Agricultural Machinery

z
Agricultural machinery dealers (selection)
El Watania Company for

Import (Claas), Alexandria
Golden Seven (Massey
Ferguson), Cairo
Trans Orient Company for
Marketing (John Deere),
6th October City
ECAD (New Holland), Cairo
Source: http://www.infoplease.com/atlas/country/egypt.html
Egypt: Fairs and Exhibitions

z
Sahara
} 21st 24th September 2014, Cairo (annually)
} Organized by Sahara Expo
} http://www.cicc.egnet.net/
Egypt: Basic Country Figures

z
Economy
z
} GDP 2013: 262 billion USD (+1,8%
} GDP agriculture: 14,5%
} Inflation 2013: 9%
} Industries: textiles, food processing,
tourism, chemicals, pharmaceuticals,
hydrocarbons, construction, cement,
metals
} Resources: petroleum, natural gas,
phosphates, gold, iron ore
Politics and state

} Capital: Cairo
} Administration: 27 governorates
} Head of state: President Abd al-Fattah
as-Sisi
} Government leader: Prime Minister
Ibrahim Mahlab
} Minister of Agriculture: Ayman Farid
Abouhdid
GDP
in billion USD
in billion USD
300
250
219
200
163
150
100
83
79
90
108
236
257
189
131
80
73,1
66,7
70
75,4
60,0
60
50,5
50
38,9
40
30
71,6
21,3
23,5
28,9
20
50
10
0
0
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Source: World bank
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

z
Demographics
} Total population:
82 m
1,8% (est.)
} Fertility rate:
99,6% Egyptian, 0,4% others
} Urban population:
44%
} Below 15 years:
32%
} Illiteracy rate:
26%
Languages
Arabic
Egypt-Arabic, Nubian, Berber, French,
English
Religion
}
Major religion:
Islam
Minority religions:
Christianity (app. 10 %)
Currency
} Name of currency
Egypt Pound (EGP)
} Exchange rate:
1 EUR = 9,74 EGP (06/2014)
Egypt: Contacts
z
German-Arab Chamber of Industry and

Commerce (AHK)
} P.O. Box 385, 11511 Ataba, Cairo
} +202 33 36 81 83
} info@ahk-mena.com
} www.ahkmena.com
German Embassy in Egypt

} 2, Sh. Berlin (off Sh. Hassan Sabri)
Cairo Zamalek
} +202 2728-2000
} info@kairo.diplo.de
} www.kairo.diplo.de
GIZ Egypt
} 4d, El Gezira Street, 3rd Floor
11211 Zamalek-Cairo
} +202 27359 750
} giz-aegypten@giz.de
} www.giz.de
Germany Trade and Invest in Egypt

} 21, Sh. Soliman Abaza, Mohandessin/
Giza
} +202 3 333-8494
} michael.marks@gtai.de
} www.gtai.com
Zambia May 2014
Zambia: Interviews
enterprises and to agricultural machinery dealers. This month, we took a closer look at the Southern African country
Zambia.
Double-digit growth rates in Zambias agricultural sector
Mr. Munalula is the owner of a 70 ha farm close to Lusaka. He and his
twelve employees primarily cultivate maize - to a lesser extent also
cassava, soy beans, millet and sorghum. However, most of his income
Mr. Munalula generates by hiring his 45 HP tractor and his ploughs to
other farmers. His clients are small-scale farmers in the near
neighborhood as well as medium-scale farmers with farms ranging
between a dozen and several hundred hectares. Most of them do own
farm land sometimes vast areas - but cannot afford agricultural
machinery, others do not know how to use the technology. Per hectare,
Mr. Munalula charges about 450 kwacha which is around 50 Euros. We
ask Mr. Munalula if he sometimes also works for other farmers without
being paid: No, unless they are people we know like our neighboring
small scale farmers. We relate well, we can maybe exchange they
can have our tractor, we can exchange with their water pumps when
our water pumps are not working very well its people we know who
we deal with for free.
Mr. Munalula tells us that the farming sector in Zambia has developed
very fast during the past years: As you know we are under developed,
but the good part is we are a fast growing economy. At the moment
farming has become a business. You find more and more people are
going into farming. Particularly commercial farming due to investors
that are investing money into their projects. I think we will be getting
more competition from the large scale farmers.
To Mr. Elias Mbewe - marketing manager at ag machinery dealer Saro

Agro in Lusaka this development is beneficial: Basic demand is high.
You know farming now is a business. A lot of them are getting into this
kind of business. And there is a growth in demand now.
Indeed, since 2009 the annual growth rate in Zambias agricultural
sector has been double-digit. Also the number of commercial farms has
increased by more than 60% since then. Today, there are about
800,000 small-scale farmers with up to 5 ha in Zambia, about 50,000
emerging farmers with 5 to 20 ha, 740 large farmers with up to 150 ha
and 15 agricultural companies with several hundred or several
thousand ha.
Mr. Munalula on his farm
Zambia: Interviews
Support of cooperatives & abolishment of maize subsidies
Mr. Nabuyanda has purchased his 80 ha farm 150 km west of Lusaka
in the year 2000 when he retired from the mining industry. Primarily
because he needed money to finance his childrens education but also
in order to remain self-sufficient and independent of other people.
Currently, five employees together with their families work on the farm.
Mr. Nabuyanda owns nine cows and his employees milk about 100
liters daily by hand as most farmers in the region. In addition they
plant maize and keep some beef cattle. Mr. Nabuyanda tells us that his
farm belongs to a cooperative: Our intention in the cooperative is that
when we put our milk together, we can have a large output of milk to
the processor. The government is willing to support dairy farmers
because milk has been stated to be the most nutritious thing for the
average Zambian. So they have come in to try and help farmers also
through cooperatives. Farmers have been able to access loans at a
lower interest. The government is supporting that industry. Indeed,
Zambia has been really successful in establishing cooperatives in the
dairy sector. The government is now trying to transfer this success
story to other branches such as crop cultivation.
Mr. Nabuyanda though intends to completely move away from

crop/maize cultivation in the long run in order to focus on dairy only.
Like many other farmers in Zambia, he feels the effects of the
governments recent decision to abolish the subsidies on the price of
maize. The maize price had been subsidized for many years which
made many farmers, especially small-scale, focus on the cultivation of
the crop. However, last year, the government decided to abolish the
subsidies from 2014 on. According to Mr. Nabuyanda producing maize
now is not economic anymore: The most important crop is maize as
staple crop but we are trying to move away from spending most of the
time on maize but rather spending more time with dairy. We found out
that with dairy activities you are receiving better output and also better
in terms of your sales than in maize. Right now the price of maize is
lower than your inputs, so you find out you spend more money trying to
produce maize and find that you are running into a loss.
Mr. Nabuyandas farm
Zambia: Interviews
Ag machinery market quadrupled within three years
Both Mr. Nabuyanda and Mr. Munalula own some agricultural
machinery but also depend on manpower and animal power in regard
to many activities. The plan is to purchase more agricultural machinery
in order to speed up operations, to improve the quality of the harvest
or milk, but also because workers are becoming more and more
expensive.
Mr. Mbewe is of the opinion that German technology has good chances
in Zambia: I just love their brands. German products, there is no
compromise. The make good, good quality. Those products, I will say
we need them in Zambia for our terrain. Just as you and me know that
our terrain is quite bad. A product you are bringing in the country must
withstand to that particular terrain. And the Germans are strong and
reliable brands.
Saro Agro, the company Mr. Mbewe works for, sells tractors and
tractor- as well as ox-driven implements such as ploughs, seeders,
planters, reapers and shellers many of them from India. There are no
import duties on agricultural machinery in Zambia a decision by the
government in order to support mechanization. Last year, Saro Agro
sold about 200 tractors - with a 60 HP model for about 14.000 Euros as
best-seller. The total tractor market in Zambia is estimated to be
around 500 to 600 units. The combine market again is estimated to be
about 40-50 units. Also here Saro has about 50% market share. We
ask Mr. Mbewe who their main customers are: We sell more to the
small farms and to the emerging farmers. There are also commercial
farmers with 1000+ hectares that selectively buy the products but I
think we sell more of our products to small farms, about 10, 15, 20
hectares. For emerging farmers we are talking about maybe 50
hectares and above, maybe 100 or 200 hectares. Indeed many
commercial farmers in Zambia import their equipment directly from the
manufacturers so that the dealers main customers are primarily
smaller farms. In total, Zambias market volume in regard to agricultural
machinery actually quadrupled between 2010 and 2012. Currently,
especially sales of planters, ploughs, two-wheel tractors as well as
irrigation equipment grows rapidly.
Mr. Mbewe from Saro Agro
Zambia: Quotes by Industry Experts

Nearly nowhere in Africa and in
the world land reserves are as
large as in Zambia. Zambia is
double the size of Germany but
only 13 million inhabitants.
The government strongly supports the
establishment of huge farm blocks. The
blocks are about 100,000 ha in size and can
be an interesting investment opportunity.
Half of the country is suitable for arable farming
but only 15% is actually used. That leaves 53
million ha unused. Water resources are
sufficient 40% of Southern Africas fresh
water resources run through Zambia - and the
climate is favorable. By means of irrigation,
harvest is possible all year long.
They are building a demonstration and training
center North of Lusaka where also German
agricultural machinery manufacturers, the German
Agricultural Ministry and the Zambian National
Farmers Union as well as GART are involved. From
the companies so far Claas, Amazone, Lemken and
Pttinger as well as Europlant, Riela, Fliegl and
Rauch are participating. Apart from that, also
AGCO purchased a 148 ha model farm close to
Lusaka. There is a lot happening right now.
With adequate irrigation this is going to be a very

interesting market for harvesting technology.
However, so far only 50,000 ha are irrigated
the potential is about 420,000 ha.
Zambeef one of the largest
agricultural companies in
Zambia - got a credit from the
German Development Bank and
became very successful.
Between 2011 and 2015 probably the
9th fastest growing economy in the
world. But they suffer a lot from energy
shortages.
For an African country, a
strong democracy and rather
stable and peaceful but its
economic policy is still a little
erratic.
Zambia National Farmers Union is one of the
strongest farmers unions in Africa. Small-scale
as well as large farmers are involved. In the near
future, they want to establish professional
machinery rings with the help of SACAU.
Zambia: Agriculture
z
}
Crop production:
z
Maize
z
Cassava
z
Sugar cane
z
Cotton lint
z
Tobacco
z
Vegetables
z
Cotton seeds
z
Soybeans
z
Groundnuts
z
Wheat
z
Tropical fruit
z
Pulses
z
Sweet potatoes
z
Rice
Animal production:
z
Cattle meat
z
Game meat
z
Chicken meat
z
Eggs
z
Pig meat
z
Cow milk
z
Goat meat
Agricultural area
}
2,9 3 million t
1,2 1,3 million t
3,5 3,9 million t
84.000 86.000 t
59.000 62.000 t
320.000 350.000 t
70.000 180.000 t
100.000 200.000 t
110.000 280.000 t
170.000 250.000 t
82.000 83.000 t
30.000 32.000 t
160.000 250.000 t
49.000 52.000 t
}
}
Total country area:

Arable land (pot.):
752.610 sq km
47%
15% (of the 47%)
67.000 74.000 t
36.000 38.000 t
43.000 44.000 t
50.000 55.000 t
23.000 t
89.000 t
8.000 9.000 t
Zambia: Agricultural Machinery

Agricultural machinery import Zambia
in million Euro
50

from World
from Germany
40
30
20
10
Tractors
Soil cultivation
Harvesting
Seeding & planting
Irrigation
Transport
Total
9,8 m
8,7 m
2,8 m
7,1 m
1,5 m
2,1 m
0,9 m
10,8 m
43,7 m
0
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Zambia: Agricultural Machinery

z
CAMCO (Chinese
brands), Lusaka
Kempston Agri
(Claas), Lusaka
Saro Agro (Argo,
TAFE), Lusaka
AFRGI (John Deere),
Lusaka
Power Equipment
(Massey Ferguson),
Lusaka
Danatrac (New
Holland), Lusaka
Source: http://www.infoplease.com/atlas/country/zambia.html
Zambia: Fairs and Exhibitions

z
Agritech Expo Zambia

} 17th 18h April 2015, Chisamba near Lusaka
} Organised by Spintelligent (German pavillion
organised by DLG)
} www.agritech-expo.com
Agriculture and Commercial Show of Zambia

} 31st July 5th August 2014, Lusaka
} Organised by Agricultural and Commercial
Society of Zambia
} www.acsz.co.zm
Zambia Copperbelt Mining and Agricultural Show

} 29th May 2nd June 2014, Kitwe
} Organised by the Agriculture and Commercial
Show Society
} www.cacss.co.zm
Zambia: Basic Country Figures

z
Economy
} GDP 2012: 22,2 billion USD (+6,5%
} Employees: 6,3 million
} Industries: copper mining and processing,
emerald mining, construction, foodstuffs,
beverages, chemicals, textiles, fertilizer,
horticulture
} Resources: copper, cobalt, zinc, lead,
coal, emeralds, gold, silver, uranium,
hydropower
Politics and state

} Capital: Lusaka
} Head of state and government leader:
Michael Santa
} Minister of Agriculture: Robert Sichinga
GDP
in billion USD
in billion USD
25
14
19
20
15
15
11
10
5
12
21
16
13
12
12
10
10
8
6
11
4
2
0
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Source: Worldbank
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

z
Demographics
} Total population:
15 m
} Population growth rate:
2,9%
} Fertility rate:
21% Bemba, 14% Tonga, 7% Chewa, 6%
Lozi, Nsenga 5%, 4% Tumbuka, 4%
Ngoni, rest others
} Urban population:
39%
} Below 15 years:
46%
} Illiteracy rate:
39%
Languages
English
Bemba, Nyanja + more than 40 others
all members of Bantu language family
Religion
}
Major religion:
Protestant
Minority religions:
Catholic, natural religions, Hindu, Islam
Currency
} Name of currency
Kwacha (ZMW)
} Exchange rate:
1 EUR = 8,63 ZMW (06/2014)
Zambia: Contacts
z
Southern African German Chamber of

Commerce and Industry (also responsible
for Zambia)
} 47 Oxford Road, Forest Town 2193,
Johannesburg
} +27 11 48 62 775
} info@germanchamber.co.za
} www.germanchamber.co.za
Agricultural Section of German Embassy
in South Africa (also responsible for Zambia)
} 180, Blackwood Street, Arcadia, Pretoria
0083
} +27 12 / 4 27 - 89 29
} La-1@pret.auswaertiges-amt.de
Zambia National Farmers Union

} ZNFU Head Office, Farmers Village,
Tiyende Pamodzi Road, Showgrounds,
P.O Box 30395
} +260-211-252834 / 252649
} chembe@znfu.org.zm
} www.znfu.org.zm
GIZ Zambia
} Kariba Road, Plot 6469, Lusaka
} +260-211-291918-20
} giz-zambia@giz.de
} www.giz.de
Kenya April 2014
Kenya: Interviews
enterprises and to agricultural machinery dealers. This month, we took a closer look at the East African country Kenya.
Average field sizes decreasing

The Kapsuswa farm is 1,200 ha large and located in Western Kenya.
Its main focus is maize, tea and dairy. Charles Boit, the director of the
farm, tells us that the majority of farms in his area are either small- or
medium-scale. While medium and the few large-scale farms focus on
maize, wheat or barley, small-scale farmers primarily produce maize
also as well as a couple of bean varieties and some other vegetables.
A minority of the small farms use tractors for land preparation and/or
planting. Typical medium scale farms usually have tractors of up to 100
HP, ploughs, chisel ploughs as well as harrows and maize/wheat
planters. Large farms again are usually well equipped with all kinds of
machinery. These farms are primarily located in Central Kenya in the
area surrounding Mount Kenya and also in Western Kenya in the area
of the upper and lower Rift Valley. Apart from a few exceptions, farm
land is in private hands in Kenya. The government does own a couple
of farms and in some parts of the country land is also being leased (e.g.
in the area of Narok where Massai who do not farm themselves
lease land to the locals or to Europeans), but in general leasing is still
rather exceptional.
Mr. Boit from the Kapsuswa farm
Kenya: Interviews
In contrast to many other regions in Africa, agricultural land seems
rather scarce in Kenya as Mr. Boit tells us: There are very few large
farms around left. If you were to say you want 3,000 acres, you will not
find it. In arable land, you will have to go somewhere where you will
set up irrigation, clear bush but even if you are clearing bush, it is not
arable land, it is land that is not useful. The reason why the government
is doing the Galana irrigation project (plans for a large government farm
based on irrigated fields in the North Rift) is because they have run out
of land elsewhere. Their best option is not to go to a dry place, the best
option is a nice wet place where its raining with subtropical weather,
where the soils are good. But if you have been forced to go to Galana
to do your project, it basically tells you that there is no land left for
purposes of agriculture.
Although Mr. Boits farm is much larger than the average, the system
has been the same only now his family is trying to revert it: We had
even a prime example of subdivision. My grandfather had 3,000 ha but
he subdivided it into huyu amepata huyo 600, huyo 700 (this one has
got 600, the other one 700 etc.). He subdivided it into sectors. We are
as a family trying to bring it back to 3,000 now. So that we can do it all
as one project. But it is very difficult because people have their own
plans. You know you cant plan for everybody but in reality it will make
more sense to do the land as 3,000 ha, not to do the land as
individuals. At the end of the day though, whether you like it or not, the
subdivision of land will occur. It will have the single biggest impact on
our production, on our capacity to produce.
Also Mr. Nyalechea owner of the contractor firm Skyfire Enterprises

confirms this trend. Usually, in addition to the contractor business, he
rents about 50 acres of land to produce maize and wheat on it, but right
now he finds that the situation on the land market has changed: At the
moment there is high competition of land, so when you want to rent a
farm for planting maize or wheat, it is very expensive. Like now the rate
has gone up. Sometimes up to ksh 5,000 per acre (appr. 50 Euro), so it
is very challenging and very difficult to get, so we decided to major on
contracting. When you look for a piece of land next year, it will have
increased by two thousand. Farming is a lucrative business so now the
land owners are taking advantage, so they increase the price. It will
reach a time where you will find that it is not economical anymore.
But agricultural land is not only becoming more expensive in Kenya, it
is also becoming more and more small-structured. As the population
grows, the land sizes reduce because parents usually give their land in
equal shares to their children (and most families have 3-4 children).
xxxx
The Kapsuswa farm
Kenya: Interviews
Ken Wanjohi from CMC is feeling this trend already. CMC is dealer for
New Holland, Case IH and Nardi. CMC is projecting to sell about 750
tractors and 300 implements in the current financial year. Currently,
60% of the tractors they sell are between 40 and 80 HP and the trend is
going further and further to lower HP classes as fields are becoming
smaller and smaller.
CMC usually has about 50% market share, so Mr. Wanjohi estimates
the total tractor market in Kenya to be about 1,500 new units. He tells
us that many tractor manufacturers entered the market recently: Our
sales have been growing although we have had a lot of other entrants
in the market. John Deere came about a year ago and they are doing
well. We also have a lot of Asian tractors that have come in, Mahindra
and others and Japanese Kubota. In the last three years we have
heard about eight new tractor brands coming into the market which was
initially dominated by New Holland, Massey Ferguson, Same and
Landini.
Mr. Wanjohi from CMC
On CMCs premises
Kenya: Interviews
Counties are the new target group
Simplicity as purchase criterion
CMCs biggest customer segment are small-scale farmers with two or

three ha land who also use their agricultural machinery to work their
neighbours fields. Medium-scale farmers again make about a third of
CMCs sales but also large farms of up to 10,000 ha belong to their
customers. We ask Mr. Wanjohi if they have any other customer
segments: Cooperatives are there but not very active in terms of
machinery. We also have the government. Last year our country went
into devolution, which is the devolved system of government, and now
we have counties. And with the strength of counties, as you can see,
we are receiving LPOs every day. Because every governor wants to
get food security and unlike the national government, which was not
looking into individual areas, these guys have gone in full force with the
purchase of agricultural equipment. Thus this year we are seeing the
government maybe having about 15-20% of market share. Previously
the government was also involved in farming but bureaucracy and
other issues led to purchase of 20 tractors in a year which was not
enough to jump start anything. But with counties, we are at 60-70
tractors within the few months that they have been operational,
therefore we are heading in the right direction with the government.
Apart from the small-scale contractors Mr. Wanjohi describes, there

are also more and more professional contractors in Kenya such as
Skyfire Enterprises. Skyfire currently operate two combines for wheat
and maize and a 175 HP tractor for harrowing and chiselling as well as
a boom sprayer and a baler. Next to the owners Mr. Nyalechea and
his brother four drivers work in the company as well as a mechanic.
At this time of the year, business is rather calm as Mr. Nyalechea tells
us: Contracting is a seasonal affair, like as you are seeing now the
machines are idle, they are under service. We anticipate to start
harvesting in July in Narok, so July, August, September up to the end
of January, lets say February. That is seven months.
Skyfires combines
Kenya: Interviews
Skyfire is paid per ha. For maize, the average is 3,500 ksh per ha,
harrowing is about 1,500 per ha and chiselling around 2,000. Skyfires
customers are mainly private or governmental farms between 200 and
3,000 ha - sometimes though also small farms with only a couple of ha
request their services. In the near future, the company wants to invest
in a new combine and also in a plough because according to Mr.
Nyalechea, the demand for ploughing is increasing. When it comes to
the purchase of agricultural machinery, Mr. Nyalechea usually attaches
great importance to easy handling and simplicity: The problem is
mechanics - we dont have people to repair. If for example today you
buy a tractor which is an automatic and the automatic system fails, you
take them back to the dealer and I am telling you, they cannot repair it.
Just throw away your tractor. I went to ADC (governmental farm) the
other day and I found two tractors lying idle - they are very new. When
you ask ADC what is the problem with these tractors, they tell you the
gear system is automatic. They called the dealer to repair it, but they
could not do it, so they just removed the engine and disposed the other
parts. Very unfortunate.
service problem because you generally cannot get somebody to

service it fast enough so we try to remain as mechanical and as simple
as possible. South Americans (much of his equipment is by Western
brands manufactured in South America or India) are in between
European equipment and third world equipment but they are very hardy
equipment, they are easy to repair, easy to maintain, easy to look after.
Anybody can look after it, it is not high tech electronic equipment that
needs a specialist. In most cases I find that specialists are required for
European equipment. You cant calibrate it yourself, you cant do this
yourself, you need somebody else to come. Generally the trend of
farmers is to remain with what you define as simple, robust equipment nobody wants something that they cant fix tomorrow themselves. John
Deere recently came back in the Kenyan market and I was very
surprised. They didnt come in to sell the high-end tractors that they will
be selling in the US or whatever. They came to sell equipment that was
coming out of India for example. It is much cheaper to produce and sell
- generally speaking they seem to be doing very ok.
Mr. Boit from the Kapsuwa farm is of a similar opinion. On his farm,
they are very well equipped with machines such as disc and chisel
ploughs, harrows, wheat and maize planters, combines, a baler and a
forage harvester none of them older than five years. Their tractors Massey Ferguson, New Holland, John Deere and Ford are all
between 60 and 170 HP. Mr. Boit says: The most important thing for
tractors is serviceability. We chose based on simplicity of use and
repair. You got to be able to repair it. My combine right now is dead
because it had a problem last year this is April and I havent received
the spare parts. We expected the spare parts three weeks after we
ordered them. First time the wrong part came, then we ordered again,
since then it hadnt arrived, so the combine is just sitting there doing
nothing and its in pieces. The problem we face with high tech
equipment is that anything that is highly electronic immediately has a
xx
Part of Mr Boits ag machinery park
Kenya: Quotes by industry experts
The biggest and most advanced

economy in east and central
Africa. And the population is
comparatively well educated.
Parts of their agriculture are pretty

well developed already, also its food
industry, but many areas in Kenya
are not suitable for arable farming.
Doing business is not as
complicated as in many other
countries in the region.
Relatively stable and peaceful country. And not
least due to tourism they are used to dealing
with people from the West.
In September 2013, Kenya signed a treaty for
the delivery of Brazilian agricultural equipment
worth 82 million Euro basically 2,000 tractors
which will be distributed to small-scale farmers
for a subsidized price.
As part of the German Food Partnership

potato cultivation is supported in Kenya
a project called potato initiative. German
companies like AGCO, Beinlich, Grimme
and Lemken are involved.
Kenya: Agriculture
z
} Crop production (in million tons):
z
z
z
z
z
z
z
z
z
z
z
z
z
z
Mangoes
Maize
Potatoes
Tea
Bananas
Dry beans
Sugarcane
Tomatoes
Pineapples
Avocadoes
Vegetables
Cabbages
Cassava
Wheat
0,6 2,8 m t
3,4 3,6 m t
2,4 2,9 m t
0,4 m t
1,2 1,6 m t
0,4 0,6 m t
5,3 5,8 m t
0,4 0,5 m t
0,3 0,5 m t
0,2 m t
0,6 0,7 m t
0,6 0,8 m t
0,9 m t
0,5 m t
Agricultural area
} Total country area:
} Arable land
580.370 sq km
9,5%
Animal production (in thousand tons):

z
z
z
z
z
z
z
Cow milk
Cattle meat
Camel milk
Camel meat
Goat meat
Eggs
Sheep meat
3,600 3,700 k t
400 500 k t
900 k t
600 k t
300 500 k t
900 100 k t
400 k t
Kenya: Agricultural Machinery

Agricultural machinery import Kenya
in million Euro
60
50
from World
from Germany
40
30
20
Tractors
Soil cultivation
Harvesting
Seeding & planting
Irrigation
Transport
Total
26,1 m
9,1 m
3,5 m
4,5 m
0,8 m
1,9 m
0,2 m
11,1 m
57,2 m
10
0
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Kenya: Agricultural Machinery

z
CMC Holdings
(New Holland), Nairobi
Farm Engineering
Industries (Claas), Kisumu
TATA Africa (John Deere),

Nairobi (+ Mombasa,
Nakuru, Meru, Nanyuki,
Eldoret, Kitale and Kisumu)
FMD East Africa (Massey

Ferguson), Nairobi (+
Eldoret, Nakuru, Mobasa)
Source: http://www.infoplease.com/atlas/country/kenya.html
Kenya: Fairs and Exhibitions

z
Agritec Africa
} 23rd 25th June 2014, Nairobi
} Organized by Radeecal Communications (India)
} www.agritecafrica.com
Agri Food Tec East Africa

} 1st - 3rd September 2014, Nairobi (premiere)
} Organized by Planet Fair, Trade and Fairs East
Africa, DLG
} www.agrifoodteceastafrica.com
Foodagro Kenya
} 3rd 5th October 2014 Nairobi (annually)
} Organized Expogroup
} www.expogr.com
Regular exhibitions by Agricultural Society of

Kenya in many agricultural regions of Kenya
} www.ask.co.ke
Kenya: Basic Country Figures

z
Economy
z
} GDP 2013: 45,3 billion USD (+5,9%
} GDP agriculture (of total 2013): 29%
} Industries: plastic, furniture, textiles,
clothing, cigarettes, flour, agricultural
products, oil refining, aluminum, steel, lead,
cement, commercial ship repair, tourism
} Resources: sodium carbonate, gypsum,
lead, gold, silver, copper
Politics and state

} Capital: Nairobi
} Administration: 47 counties
President Uhuru Kenyatta
} Minister of Agriculture: Felix Koskei
GDP
in billion USD
in billion USD
40
35
31
32
37
27
30
23
25
19
20
15
31
34
13
15
4
2,9
2,6
3
1,9
2
2
10
1,0
1,1
1,1
2,0
2,1
2,3
1,2
0
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Source: World bank
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

z
Demographics
} Total population:
42 m
} Population growth 2010-2015 avg:
2,7% (est.)
} Fertility rate:
17% Kikuyu, 14%Luhya, 13% Kalenjin,
10% Luo, 10% Kamba, 6% Kisii, 4%
Meru, rest others
} Urban population:
24%
} Below 15 years:
42%
} Illiteracy rate:
13%
Languages
Swahili, English
Numerous indigenous languages
Religion
}
Major religion:
Christianity
Minority religions:
Islam, indigenous beliefs
Currency
} Name of currency
Kenya shilling (KES)
} Exchange rate:
1 EUR = 117,94 (04/2014)
Kenya: Contacts
z
Delegation of German Industry and Commerce in Kenya / German Business Association /

GIZ Nairobi
} Riverside Drive, Riverside Mews Bdg. (German House), Westlands, Nairobi
} +254 20 214 00 08
} office@kenya-ahk.co.ke
} secretary@gbakenya.com
} giz-kenia@giz.de
} http://ahk.de
Agricultural Society of Kenya

} +254 20 26 41 067
} info@nitf.ask.co.ke
} www.ask.co.ke
Nigeria March 2014
Nigeria: Interviews
How is the mood in agriculture in the different African countries? What are the major developments? How is the situation
on the agricultural machinery markets? To answer these questions, we regularly speak to the managers of local agricultural
enterprises and to agricultural machinery dealers. This month, we took a closer look at the West African country Nigeria.
Its booming, buyers are always there

Mr. Ibrahim Jezhi is the manager of a 50 ha farm producing maize, beni
seeds and beans. In the near future, he wants to starts cultivating also
yams, cassava and grass as animal fodder. Mr. Jezhi does not worry
finding a market for his products: The agriculture market is very
favorable. Anything you produce no problem, it is booming. Buyers
are always there available for us, we dont need to find them. Indeed
Nigeria is booming. Not only does the population explode in size 180
million people already with an annual increase by 4 to 5 million - also a
new consumption-oriented middle class is developing rapidly. Super
market chains and malls seem to sprout out of the ground.
Consequently the food demand is increasing exponentially. However,
Nigerian farmers are not even close to being able to cope with the
demand the country is forced to import food en masse. Nigeria is
worldwide the second largest rice importer after the USA. Also huge
quantities of wheat, sugar and milk powder are imported. With modern
and efficient production methods Nigeria would be able to feed itself
the soils and the climate are favorable for agriculture. However, still the
large majority of Nigerian farms is below 5 ha in size and has no
access to qualitative seeds, fertilizers or modern agricultural
machinery. There is a couple of medium sized farms such as Mr.
Jezhis which are at least partly mechanized. Especially in the North,
also some large farms of about 50 and 200 ha can be found. The
owners are often wealthy politicians as Mr. Jezhi tells us: There is one
in Ulla owned by the current governor of Adubwa Moritala Yako. A lot
of the big farms are owned by this governor and located in different
xxxx
Ibrahim Jezhi
parts of the country. There is also one in Kaduna and there is also one
in Kifya. The politicians and the retired generals own the large farms
because they have a lot of money to produce. We cannot buy as many
tractors as they can. We farmers cannot compete with them, they are
bigger mainly because of the machinery. If we had money or proper
funding we could definitely compete with them. They dont have
experience.
Nigeria: Interviews
Actually Mr. Jezhi had another farm before this one where he used to
plant rice. However, the government took that one and Mr. Jezhi had to
relocate. The same happened to Mohammed O. Maaki. He is the
owner of Oriya Farm Ltd. The company started in 2007 with 1,200 ha
land but last year the Federal Government took it away for public use
so Mr. Maaki had to move. Now he has about 350 ha and a staff of 30
plus some seasonal workers. Currently they produce yam, cassava,
soy bean, beni seeds as well as sesame seeds and pineapple which
they usually sell directly to food processing factories. Mr. Maaki tells us
that he observes signs of a structural change in Nigerian agriculture:
Fewer people are remaining with farms. So technically there must be
changes. Many people are not going into farming and moving from
agriculture. People prefer white collar jobs so young men want to go to
the city and get a job and make money. While Mr. Maaki observes the
number of farms decreasing, Mr. Jezhi sees the individual farms
increase in size: Generally in Nigeria, the farms are getting larger,
because the operations are increasing daily. We also have a big
population, so we need more farms to get more food to feed the
population. The only problem is machinery - it is too expensive.
Indeed, on Mr. Jezhis farm they have two Massey Ferguson tractors,
however, operations like planting and harvesting are still done
manually. Raising capital for modern agricultural machinery is still a
major problem for many medium-scale and of course also small-scale
farms in Nigeria.
The government is more into oil

Agricultural machines are usually paid cash, getting credits only seems
realistic for large and capital-intensive farms. The government again
currently does not offer any major programs to support mechanization.
Mr. Maaki, whose farm is actually pretty well equipped with tractors,
planters, sprayers and combine harvesters, tells us that there was a
program in 2008. In that year, the state purchased a large number of
xxx
Mr. Maakis harvester
Mahindra tractors and sold them to farmers at reduced prices. That is

also how Mr. Maaki got his Mahindra tractor. Today he considers
Mahindra as his favorite brand reliable and spare parts are easily
available as he says. After 2008 though not much happened to support
agricultural mechanization in Nigeria. For the government, rather the
production of oil seemed to be the major focus of attention in the past
years. We ask Okoli Chijioke, regional sales manager of TATA Africa
(John Deere distributor), what is missing in the Nigerian market: I
would sum it up in zero agricultural mechanism support. They [the
government] are not helping at all the farmers and they are having a
hard time adjusting. The Federal Govt. recently approved the sum of
N15billion (about 66 million Euro) for loan to farmers to be given out at
single digit interest rates. But we really need to ask ourselves, who is
this money going to? Because, we as the equipment suppliers dont
actually feel the impact of such funding. Theres a lot of corruption in
the system. Also the Central Bank of Nigeria has a scheme called
commercial agriculture credit scheme, but frankly speaking we dont
feel the impact of these guys.
Nigeria: Interviews
Mr. Jezhi adds: They only remember you during campaigns, this is
when they give subsidies for fertilizers and the caterpillars and tractors
are put in the Ministry after campaigns for their own farms. They
provide very few farmers support. Mr. Maaki is of a similar opinion:
Politics on agriculture is only on regimes, not on real life. So they say I
am going to supply this, I am going to supply that but they disengage.
They dont take farming seriously, they are more into oil. The
procedures and the processes are done in a way that the farmers dont
like it. The rules and regulations done as an excuse for support to
farmers are not liked. The other side of the coin is that, apart from the
fact that the state does not seem to engage a lot into the support of the
farmers, it does not seem to intervene much into entrepreneurial
freedom either as Mr. Maaki explains: The state doesnt tell you to
produce this amount of crop, you just pay taxes. And the prices are
dependent on demand and supply. Its a completely free market.
Nigeria a hard place
TATA Africas head office is in Lagos. The company has existed for six
years, the agricultural department for two years now. TATA is the
exclusive partner of John Deere in Nigeria. Their main customers are
contractors but also small or medium scale farms as well as some
cooperatives and a few state farms. In Nigeria, the company primarily
sells tractors, many between 225 and 350 HP. But also tipping trailers
(FT10), sprayers (MS10) and seed/fertilizer drills (SD10) as well as
cultivators (SC12) and disc ploughs (DP10/1003) are in their portfolio.
Their annual target is to sell 90 tractors. In total, that is across all
brands, about 400 new tractors are sold in Nigeria in a year. In 2012,
the government communicated that all custom duties on agricultural
machinery imports would be abolished. However, dependent on the
governments narrow interpretation of agricultural machinery, usually
import duties are still raised for the majority of machines as also Mr.
Chijioke from TATA is telling us:
If you are importing CKD
xxxxxxxxxxx
(complete knock down meaning that parts are imported and then
assembled locally) you are going to be paying about 5-6% to customs
in taxes. TATA imports fully assembled machinery and on each
equipment we pay about 10%. For companies that bring in SKD (semi
knock down) their duty is usually less than ours because the
government encourages such as they are sure going creating
employment. Tax Duty should be reduced because, when the OEM
sell, considering the tax paid on equipment, the farmer also increases
cost of his products and its just a long cycle. At the end of the day the
end user suffers the increment in price.
At the end of our interview, we ask the two farmers to give a
recommendation to German agricultural machinery manufacturers who
want to become active in Nigeria. Mr. Maaki responds: Most of the
farm machineries are not adapted to the land. Some of them are too
low. They cannot work here because we have stones. They should
make further studies on the soil before they introduce the machinery in
here. Also Mr. Jezhi adds: I would recommend that they come down
here and see our land. They see the soil and see the texture. Our land
is hard and not soft and its stony so not everything works with it.
Finally Nigeria is a hard place.
Mr. Chijioke (right) with our moderator
Nigeria: Quotes by Industry Experts

AGCO considers to start a tractor
assembly plant in Rivers and Kaduna. The
Indian tractor manufacturer Sonalika
already has an assembly plant in Nigeria.
Extreme North South divide:

the South is much more
advanced than the North.
Under the German Food Partnership,

there is the potato initiative - AGCO,
Beinlich, Grimme and Lemken are
involved. There is also a plan for a 12
million Euro PPP together with Germany
for the support of rice production (CARI).
The government buys agricultural
machinery and either sends them to
government farms or hires them to
local farmers.
One of the most interesting and at the same time one
of the most difficult and complicated markets in SubSahara Africa. They have extremely high crime rates
there and corruption is omnipresent. Especially
corruption is estimated four billion USD a year.
Next to subsistence farming there are a couple of large

farms focusing on rice, cassava or maize a sector
which showed good growth rates within the past years.
Although many large farms also belong to government
officials. And the food industry has been developing
pretty well during the last years.
Growing middle class which is

able to afford a Western
lifestyle. Now considered a
low middle income country.
With more than 170 million people the largest market

in Africa and for German companies the second
largest export market in Sub-Sahara Africa.
Belongs to Goldman Sachs Next 11
those countries which will significantly
impact the global economy.
Tendencies of islamization are increasing
and again and again there are bloody
conflicts between Muslims and Christians,
especially in the North.
There are about 20,000 tractors in use. Potential
annual market volume is 5,000 tractors.
The 4th largest agricultural machinery
market in Sub-Sahara Africa.
More and more equipment
hiring firms are developing and
tractors can be hired for about
70 USD per ha.
In Ekiti State, AGCO

is develoing a
training center.
Nigeria: Agriculture
z
z Yams
34 - 38 m t
z Cassava
42 - 44 m t
z Citrus fruits
3,8 3,9 m t
z Rice
4,5 4,8 m t
z Groundnuts
3 3,8 m t
z Vegetables
6 6,2 m t
z Maize
7,7 9,7 m t
z Sorghum
6,9 7,1 m t
z Millet
5 5,2 m t
z Cashew
0,8 m t
z Taro
3 3,5 m t
z Okra
1,1 m t
z Cow peas
1,9 3,4 m t
z Plantains
2,7 2,8 m t
} Animal production (in million tons):
z Cattle meat
0,3 m t
z Goat meat
0,3 m t
z Sheep meat
0,2 m t
z Eggs
0,6 m t
Agricultural area
} Arable land:
923.770 sq km
39%
Nigeria: Agricultural Machinery

Agricultural machinery import Nigeria
in million Euro
80
from World
70
from Germany
60
50
40
30
20
Tractors
Soil cultivation
Harvesting
Seeding & planting
Irrigation
Transport
Total
13,8 m
8m
4,5 m
2,4 m
1,2 m
1,1 m
3,3 m
36,5 m
70,8 m
10
0
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Nigeria: Agricultural Machinery

z
Agricultural machinery dealers (selection) / agricultural regions (in orange)
TATA Africa (John

Deere), Lagos
Dizengoff (Massey
Ferguson), Lagos
Scoa (New Holland),
Lagos
Springfield Agro
(Mahindra), Lagos
Bertola (Chinese
brands), Lagos
Source: http://www.infoplease.com/atlas/country/nigeria.html
Nigeria: Fairs and Exhibitions

z
agrofood Nigeria
} 28th 30th April 2015 Lagos (premiere)
} Organized by fairtrade
} www.agrofood-nigeria.com
AGRIKEXPO West Africa

} 20th 22nd May 2014, Lagos (annually)
} Organized by 151 Products Ltd
} http://www.151productsltd.com/
Nigeria: Basic Country Figures

z
Economy
} GDP 2013: 292 billion USD (+6,2%
} GDP per capita 2013: 1,725 USD
} Employees in agriculture: 70% million
} Industries: crude oil, coal, tin, columbite,
rubber products, wood, hides and skins,
textiles, cement and other construction
materials, food products
} Resources: natural gas, petroleum, tin,
iron ore, coal, limestone, niobium, lead,
zinc, arable land
Politics and state

} Capital: Abuja
} Administration: 36 states
President Goodluck Jonathan
} Minister of Agriculture: Akinwumi
Adesina
GDP
in billion USD
in billion USD
300
250
207
200
145
150
100
229
68
88
166
244
263
169
112
50
0
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Source: World bank
90
80
70
60
50
40
30
20
10
0
76,4
69,2
54,2
60,3
45,6
29,3
31,4
26,3
31,2
37,3
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

z
Demographics
} Total population:
165 m
2,5% (est.)
} Fertility rate:
29% Hausa and Fulbe, 21% Yoruba, 18%
Ibo, 10% Ijaw, rest others
} Urban population:
50%
} Below 15 years:
43%
} Illiteracy rate:
39%
Languages
English
Yoruba, Haussa, Igbo, Fulfulde and a
multitude of other languages
Religion
}
Major religion:
Islam (North) and Christianity (South)
Minority religions:
Traditional African religions
Currency
} Name of currency
Naira (NGN)
} Exchange rate:
1 EUR = 225,88 NGN (03/2013)
Nigeria: Contacts
z
Delegation of German Industry and Commerce in Nigeria

} P.O. Box 51311, Falomo Ikoyi, Lagos
} +234 12 70 07 46
} roenne@lagos-ahk.de
} http://nigeria.ahk.de
GIZ Nigeria
} 4 Julius Nyerere Crescent, Asokoro
FCT Abuja
} +234 7044369589
} giz-nigeria@giz.de
} www.giz.de
German Embassy in Nigeria

} Abuja 9 Lake Maracaibo Close, Maitama, Abuja, F.C.T.
} +234 9 220 80 10
} info@abuja.diplo.de
} www.abuja.diplo.de
Angola February 2014
Angola: Interviews
enterprises and to agricultural machinery dealers. This month, we took a closer look at the Southern African country
Angola.
Our great sickness is the fever of imports
Antonio Emilio is the manager of a 110 ha farm focussing on
horticulture as well as sunflowers, potatoes and maize. Recently he
started to silage the maize as animal fodder something rather new in
Angola. Three years ago Mr. Emilio started the farm from scratch.
Today about 25 peasants, operators and unskilled workers are active in
the agricultural company. The farm has been very productive so far,
however Mr. Emilio cannot sell all the produce in the market: We come
to a point where we are forced to throw away tomato, we are forced to
throw away cabbage, we are forced to damage pineapple in the field,
why? Because we have nowhere to sell this product, we have nowhere
to market this product. Our great sickness is the fever of imports. We
have domestic production, this production cannot come regularly and
when it reaches the market, that same market does not absorb it,
why? Because its flooded with imports - things we produce in Angola
are imported from outside.
What makes things worse is the dependence of Angolan farmers on
middlemen for sales. These middlemen pay the farmers often only a
small part of what they get by reselling the products. Mr. Emilio refers
to them as Kinguilas: They are based in the market and have
assembled a network that no one can bypass. So often these are the
ones that devalue the work that we do. Because they want to buy it
cheap then go and fetch profits. The farmer rents a truck to bring the
xxxx
product to the market, arrives at the market and the cost of selling the
product is not even enough to pay the truck rental; the poor farmer is
forced to tell the motorist to keep the produce and sell it to recover his
costs. That's because there is no trade policy on prices, on the
marketing of agricultural products. There is no policy that stabilizes it,
one that can benefit those who produce. The intermediaries never get
into financial ruin or a loss. Now those that produce seldom make
profits because of the intermediaries. Yes that is our reality which is not
normal. Normally the producer would sell to cooperations or retailers
and they sell directly to consumers. The two intermediaries take their
share and the producer is the victim. If society could only eliminate this
class of intermediaries that have emerged out there.
Large farms are more for show business
Next to the many subsistence, small and medium farmers, there is a
number of large farms in Angola some are from Colonial times, some
are new. The owners are often wealthy politicians, army generals or
businesspeople. However, not all of these farms are active and
productive as Mr. Emilio explains: We have small, medium and large
farms. Small farms usually are only 50 hectares and they only use up
to around 10 to 15 hectares. The rest is residential, tourist
infrastructure or leisure and so on. Now the average sized farms are
usually those that begin from 50 hectares up to 300 or 400 hectares.
Angola: Interviews
These produce over 50 to 100 hectares. And then we have the large
farms which have less structures as such but vast land. There are
hundreds of large farms with over 1,000 hectares, some up to 5,000
and 10,000 hectares. Typically these farms are said to be large farms they are the ones that are able to approach banks for funding. And
many are able to start but then end up failing. We have many such
examples. Because the reality of agriculture in Angola is not the big
farms, because large farms are more for show business. People want
to be seen as though they are larger farmers yet they do not do
anything concrete. They do not produce, they have no social impact.
Indeed medium farms and small farms and in general peasants are the
major producers. These each producing their two or five or six acres - if
they are 10,000 of them, imagine how many thousands of hectares
adding it all together. Large farms cannot reach that because of the
system of structuring a farm, the more equipment you have, the more
organization it requires, the more skill required the country is not
ready for this. So I see there are many large farms that become
graveyards of old iron. New equipment purchased that have never
been put to work, but are rusting away. The reason mismanagement.
However, not all large farms are mismanaged and in fact the number of
large highly productive farms is on the increase in Angola not least du
to governmental support. In the long run, also Mr. Emilio is starting to
fear their competition: The competition for us comes from these great
landowners. We do not have the capacity that they have to industrialize
the production. They have a strong ability because they have the
financial resources. So they industrialize production.
Antonio Emilio
Angola: Interviews
Antonio Silva is the manager of GlobalWay, an agricultural machinery
dealer in Luanda selling various brands many of them from South or
North America. He tells us that their customers are small or medium
farmers either with own capital or by support of the Development
Bank of Angola as well as large farms. About the large farms Mr.
Silva says: They are really are growing and are also increasing in
number. The owners are individuals who have their own capital, others
are people who received credit from banks, other people are big
businessmen, many are members of the government have top
government positions. So these have large farms.
We ask Mr. Silva what kind of products are requested by his
customers: What we sell the most are ploughs with three or four discs,
small grills with 75 HP tractors, seeders three or four lines, trailer twin
wheels, tanks, tank trailers also, irrigators Mr. Silva tells us that
each year their orders are larger and they sell a little more than the
previous year. Usually, their customers press for the old brands they
know from Colonial times, for instance John Deere or Massey
Ferguson. We ask Mr. Silva what he would recommend to agricultural
machinery producers who want to become successful in Angola: It
does not matter much if you sell it while there is no training. We have
had major problems in the sale of machinery which after some time
customers always come asking us how to do its tuning because
sometimes it is a machine that requires adjusting. Thus I think pre-sale
and post-sale training seems very primal. They do bring the manuals
but our peasants also need training. Even with the manual they cannot
handle the thing.
The fundamental objective of government is to put all the farms

working
Abel Martins de Sousa is the manager of a 72 ha farm which is part of
the company Angoca Agro-Livestock Commerce. Primarily they
produce maize and beans as this is what the government currently
supports. On their farm they have among others Claas and New
Holland tractors and combine harvesters. For some of their agricultural
machinery they received subsidies from the government. Mr. de Sousa
explains: Subsidies in Angola is for everyone. Basically, one has to
prepare a feasibility study. You elaborate a feasibility project for the
operation of that farm - small, medium or large. You proceed to the
governing bodies, its submitted for their consideration and approval
and from there comes the credit. Because the fundamental objective of
government is to put all the farms working. Agriculture in Angola today
is much better and will still improve; because now there is talk of a
mechanized agriculture. Government support in terms of agricultural
machinery has the farmer highly encouraged... engaged in production.
It seems incredible but Angola is now producing and is already thinking
about the export of agricultural products. Agriculture is a speeding up in
Angola. Because there is a significant support from the government
itself.
Angola: Interviews
Also Mr. Silva from GlobalWay is optimistic when it comes to the future
development of agriculture in Angola: Well It seems that with
governments program to fight hunger and poverty, there is a great
investment and interest on the part of the government to boost
agricultural production. It seems that in the next 10-20 years,
agricultural production will increase by some 10-15%. In 2000, 80% of
the work was manual labour and only 20% was mechanized thus in the
next ten years there will be around 35% mechanized. Noting that we
have enjoyed more or less 12 years of peace, it is only now that
agriculture is being mechanized. Now, things are changing gradually.
Currently its increasing and around 25% of the work now is
mechanized. Peasants, farmers are being funded by Development
Bank of Angola and small banks, these are acquiring more or less highpower machinery and now, only now is the farming industry emerging.
Mr. Silva from GlobalWay
Mr. da Sousa from Angoca
Mr. da Sousas ag machinery park
Angola: Quotes by Industry Experts
Actually the 2nd largest agricultural

machinery market in Sub-Sahara Africa!
They are rich in crude oil and minerals.
One of their main buyers is China. In
return, China gives loans for infrastructure.
Before the war, Angola was THE exporter of
agricultural products in Southern Africa. Now 90%
of food is imported and 30% of Angolans are
dependent on international food aid.
During the Colonial area Africas bread basket.
Now there is a lot of subsistence agriculture and
some large farms which belong to the state or
some generals but a lot of land is lying fallow
because they just took the land in the past
without having any expertise in farming.
Entry into the country is not uncomplicated and for
business people, Luanda is one of the most
expensive cities in the world. But business can be
successful but you need to have a lot of patience.
Initial costs are often high and you have to speak
Portuguese or you need to have an interpreter, with
English you wont get far.
Usually the state gives agricultural land

on lease, but there are exceptions.
However, title deeds and everything
when it comes to land ownership is a
total chaos.
2002 27 years of civil war were ended. Now
the political situation is relatively stable,
however the war had its influence on
infrastructure, the capacity of the
administration and the legal system in total.
2nd largest water resources in Africa
and good agricultural potential nearly
50 million ha unused agricultural land.
But a large part is still mined and in
general, the property situation is very
chaotic.
The second largest oil producer in
Africa and the third largest economy in
whole Sub-Sahara Africa. The
economy is strongly dependent on oil.
Income differences between rich and
poor are immense in Angola.
Angola: Agriculture
z
Agricultural area
} Agricultural land (potential):
} Arable land (in use):
} Crop production:
z Cassava
z Potatoes
z Maize
z Dry beans
} Animal production:
z Cattle meat
z Pig meat
z Chicken meat
z Milk
1.246.700 sq km
56 million ha
10 million ha
1,100,000 1,500,000 t
100,000 t
50,000 150,000 t
50,000 150,000 t
300.000 t
100,000 t
30,000 t
100,000 t
Angola: Agricultural Machinery

Agricultural machinery import Angola
in million Euro
90
80
70
60
50
40
30
20
10
0
from World
from Germany
Tractors
Soil cultivation
Harvesting
Seeding & planting
Irrigation
Transport
Total
35,8 m
6,3 m
9,3 m
5,1 m
4,2 m
6,3 m
3,1 m
9,8 m
79,9 m
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Angola: Agricultural Machinery

z
GlobalWay (New Holland,

Jumil), Luanda
Impormaquinas Comercio
de Maquinas (Massey
Ferguson), Luanda
GlobalWay (New Holland,

Jumil), Waku Kungo
Lonagro Angola (John

Deere), Luanda
GlobalWay (New
Holland, Jumil), Lobito
Source: http://www.infoplease.com/atlas/country/angola.html
Angola: Fairs and Exhibitions

z
FILDA
} 15.07.-20.07.2014 Luanda
} Organized by Expo Angola S.A.
} http://www.fil-angola.co.ao
Angola: Basic Country Figures

z
Economy
z
} GDP 2013: 124 billion USD (+8,8%
} Employees: 9 million
} Employees in agriculture: 6,2 million
} Industries: basic metal products, fish
processing, food processing, brewing,
tobacco products, sugar, textiles
} Resources: petroleum, diamonds, iron
ore, phosphates, copper, feldspar, gold,
bauxite, uranium
Politics and state

} Capital: Luanda
President Jos Eduardo dos Santos
} Minister of Agriculture: Afonso Pedro
Canga
GDP
in billion USD
120
104
105
84
90
75
42
45
15
82
60
60
30
75
114
14
20
28
0
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Source: World bank

z
Demographics
} Total population:
21 m
2,7% (est.)
} Fertility rate:
37% Ovimbundu; 25% Kimbundu, 13%
Bakongo, 2% mixed European and native
Africans, 1% Europeans, rest others
} Urban population:
59%
} Below 15 years:
43%
} Illiteracy rate:
30%
Languages
Portuguese
Bantu and other African languages
Religion
}
Major religion:
Roman-Catholic
Minority religions:
Protestant, indigenous beliefs
Currency
} Name of currency
Kwanza (AOA)
} Exchange rate:
1 EUR = 134,38 AOA (03/2014)
Angola: Contacts
z
Delegation of German Industry and

Commerce in Angola
} Rua Engenheiro Armindo de Andrade,
n 80
} Bairro Miramar, Luanda
} +244 222 44 2831
} Ricardo.gerigk@gmail.com
} http://angola.ahk.de

Commerce and Industry (also responsible
for Angola)
Johannesburg
} +27 11 48 62 775
Agricultural Section of German

Embassy in South Africa (also
responsible for Angola)
} 180, Blackwood Street, Arcadia,
Pretoria 0083
} +27 (0) 12 / 4 27 - 89 29
GIZ in Angola FormPRO

} Rua Martin Luther King 143/145
Luanda
} +244 222 391 707
} info@formpro-angola.org
Tanzania January 2014
Tanzania: Interviews
enterprises and to agricultural machinery dealers. This month, we took a closer look at the East African country Tanzania.
90% of our customers are contractors

Lonagro is the sole John Deere distributor in Tanzania. The company
has 22 employees and branches all over the country from Dar es
Salaam up to Kidatu, Iringa, Arusha and soon also in Mwanza. Apart
from Tanzania, Lonagro is also present in Mozambique, South Sudan
and Angola. In Dar es Salaam, the company primarily sells tractors
between 55 and 225 HP, combines and lawn mowers by John Deere
as well as some equipment by other brands. CEO Lucas Bothe
explains: When John Deere doesnt supply the product, we use an
Indian manufacturer they are mostly ground engaging equipment. We
also use Falcon for the grass cutting side of the market and fertilizer
spreaders and stuff like that. John Deere tractors, average sized ones,
we usually sell around 100 units a year. If we are talking about normal
business which means any business which does not include
government business - I have around 33% of the market share. The
brands that are currently running around here are John Deere, New
Holland, Mahindra - these are the bigger players. There are no longer
bad machines anymore, just bad service. European tractors are
practically not compatible with African conditions anymore, not
American or European machines. The machines that John Deere
brings in are especially built for Africa. So they are pretty much leading
the market.
Butwa Sanga sales and marketing manager at Lonagros

emphasizes the significance of service for the success of their
company: The most business for us is supplying parts and teaching
people how to use the machines. Thats the most added advantage in
the market. Lucas Bothe adds: Service and spare parts, we have it all
around our branches and we have got technical people on our service
vehicles. So we have technical people running around in the country
going to specific farms to deliver the spare parts.
Mr. Bothe tells us that 90% of their customers pay cash while the rest is
bank credit. Subsidies for ag machinery investments currently do not
seem to play a major role. Basically, Lonagro sees two customer
segments in Tanzania: We are looking at the bigger market at the
moment which is small farms because commercial farms are very
limited in this country. So if you look at the small farms, it is price driven
and that for now wont change. As soon as the industrial farms or the
commercial farms come up, then everything would change. By change
I mean, it wouldnt be driven by the price no more. At the moment, 90%
of our customers are contractor farms. Those people that have small
farms but they buy machines to work for other farmers. They usually
just plough and do land prep for the local farmers. They have a big role
in the company.
Business is captured between 75 and 125 HP machines
The farms those contractors own are usually between 3 and 10 ha in size while commercial farms, the remaining 10% of Lonagros clientele, can be
up to several hundred or even thousand ha large. As Lucas Bothe tells us, commercial farms in Tanzania belong to local as well as foreign investors.
A considerable part of the foreign investors were active in Zimbabwe in the past and left the country when Land Reform in the year 2000 forced
white people out. The largest commercial farms focus on sugar or rice production such as Kilovo (sugar), Taqueira (sugar) or KPO (rice). According
to Mr. Bothe, currently farm development in Tanzania is actually more or less at a standstill because the state does not lease out enough agricultural
land: The government is not giving up too much land at the moment. All the agricultural businesses are captured between 75 and 125 horse power
machines. This is where we are stuck at the moment. Also in Tanzania we get help from the government - up until land ownership. They are not
making land available to project outside.
Mr. Butwa Sanga together with the interview moderator on Lonagros premises
Farms are not getting bigger because they are limited with restrictions
Apart from the availability of agricultural land also legislation in regard to crop marketing seems to impede farm development in Tanzania.
Mtanaga Ltd. and Sao Hill Ltd. are two of Tanzanias large commercial farms. Mtanga is 3,500 ha and 700 ha are used for maize cultivation, 60
ha for soya beans, 40 ha for sweet potatoes and the rest of the land for cattle and sheep. The company has 60 permanent workers and a
number of contract employees, depending on the season. Neville Stidolph, the farm manager, tells us: The harvest was pretty good, theres
good rainfall and good soil, producing crops is not terribly difficult but we do run into problems with the marketing of crops. Also Pascal Malisa
who is the farm manager of Sao Hill a 1,200 ha farm focusing on maize production and cattle mentions: There are many challenges
especially marketwise for the commercial crops, we have no sustainable marketing for the moment and there are a lot of restrictions in selling
and making a market in foreign countries. So maybe the government could allow people to trade in other countries and that way develop a
better market. Farms are not getting bigger because they are limited with restrictions.
Farm land and machinery park by Sao Hill Ltd.
Tanzania: Quotes by Industry Experts
Between 2011 and 2015 probably the 5th

fastest growing economy in the world after
China, India, Ethiopia and Mozambique. For
the next years, about 8% GDP growth are
expected.
They recently found natural gas there this can

have a positive influence on the infrastructure
and boost the economy.
Interest rates for agricultural credits
are extremely high about 25%.
Often, business partners in Tanzania are not
from African but Indian descent. So it does
not hurt to learn something about Indian
culture before doing business there.
Growth in agriculture has been about 5% annually
in the past years. There is a strong dependence on
rain, in spite of relatively high risks of droughts,
irrigation systems are nearly non-existent.
The economic potential of the country

has not really been tapped yet. The
country lacks the necessary political
and infrastructural framework
conditions as well as a real
determination for reform.
It is definitely a large market

and compared to some of its
neighbors, agriculture is pretty
well developed already.
Tanzania is part of the East-African Community
so almost no trade restrictions with its
Northern neighbors and as part of SADC, no
trade barriers with other Southern African
countries.
Tanzania: Agriculture
z
z Dry beans
0,6 1,2 m t
z Maize
4,5 5 m t
z Cassava
4,5 5,5 m t
z Rice
1,8 2,6 m t
z Groundnuts
0,5 0,8 m t
z Sunflower seeds
0,3 1,2 m t
z Sesame seeds
0,2 0,5 m t
z Tobacco
0,1 m t
z Sweet potatoes
2,5 3 m t
z Cotton lint
0,1 m t
z Potatoes
1,2 1,6 m t
z Sorghum
0,8 m t
}
Agricultural area
} Arable land in use:
947.300 sq km
12,25%
Animal production (in thousand tons):

z Milk
1,6 1,9 m t
z Cattle meat
0,3 m t
Tanzania: Agricultural Machinery

Agricultural machinery import Tanzania
in million Euro
50
from World
from Germany
40
30
20
10

Tractors
Soil cultivation
Harvesting
Seeding & planting
Irrigation
Transport
Total
16,8 m
2,7 m
2,4 m
2,0 m
0,6 m
0,7 m
0,4 m
9,9 m
35,5 m
0
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Tanzania: Agricultural Machinery

z
FMD East Africa (Massey Ferguson), Arusha
Kivesco (Massey Ferguson), Moshi

Incar (New Holland), Dar es Salaam
LONAGRO (John Deere), Dar es Salaam
CMC Holdings (New Holland), Usa River
Source: http://www.infoplease.com/atlas/country/tanzania.html
Tanzania: Fairs and Exhibitions

z
AgriTech 2014 Tanzania

} 10.-13.04.2014 Dar es Salaam (premiere)
} Organized by Bizfora Investment Co. LTD
} www.biz-fora.com
Agri Business East Africa

} 28.-29.01.2015 Dar es Salaam (annually)
} Organized by Spintelligent
} www.agri-eastafrica.com
Foodagro Tanzania
} 17.-19.10.2014 Dar es Salaam (annually)
} Organized by Expogroup
} http://www.expogr.com/
Tanzania: Basic Country Figures

z
Economy
z
} GDP 2013: 32 billion USD (+7%
} GDP per capita 2013: 663 USD
} GDP agriculture: 29%
} Industries: agricultural processing (sugar,
beer, cigarettes, sisal twine), mining, salt,
cement, oil refining, clothing, fertilizer
} Resources: hydropower, tin, phosphates,
iron ore, coal, diamonds, gemstones,
gold, natural gas, nickel
Politics and state

} Capital: Dar es Salaam
} Administration: 30 regions
} Head of state: Jakaya Kikwete
} Government leader: Mizengo Pinda
} Minister of Agriculture: Christopher Chiza
GDP
Foreign Direct Investment
in billion USD
in billion USD
28
30
25
21
20
15
21
23
24
17
12
13
14
14
12
11,0
10
8,1
9,3
6,9
6,0
10
8,8
3,6
4,0
4,4
4,8
0
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Source: World bank
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

z
Demographics
} Total population:
47 m
} Population growth 2010-2015:
3,1% (est.)
} Fertility rate:
5 births per woman
95% Bantu
} Urban population:
27%
} Below 15 years:
45%
} Illiteracy rate:
32%
Languages
Swahili
Bantu, English, Arabic
Religion
}
Major religions:
Islam and Christianity
Minority religion:
Natural religions
Currency
} Name of currency
Tanzania-Shilling (TZS)
} Exchange rate:
1 EUR = 2,22 TZS (03/2014)
Tanzania: Contacts
z
Embassy of the Federal Republic of

Germany
} Umoja House, corner Garden Avenue
and Mirambo Street, Dar es Salaam
} +255 - 22 - 2117409
} info@daressalam.diplo.de
} www.daressalam.diplo.de
GIZ Tanzania
} 65, Ali Hassan Mwinyi Road, Dar es
Salaam
} +255-22-211-5901
} giz-tanzania@giz.de
} www.giz.de
Agricultural Council Tanzania

Commerce and Industry (also
responsible for Tanzania)
Johannesburg
} +27 11 48 62 775
Ethiopia December 2013
Ethiopia: Interviews
enterprises and to agricultural machinery dealers. This month, we took a closer look at the East African country Ethiopia.
Spirit of optimism
The mood in Ethiopia is euphoric: construction everywhere, roads are
being built, the power network is extended - meanwhile Ethiopia is
delivering electricity to Kenya, Djibouti and Sudan and also in
agriculture a new lan can be felt. Matebu Meskel an Ethiopian
investor who just acquired a 1,000 ha coffee plantation and plans to go
into sesame production this year explains the impact: When you are
connected, that is where it starts to happen. If you are not accessible,
development is not possible. I think the main thing that has helped us
progress so far was the focus on roads and highways and in the urban
areas they are doing the railways now. So even the farmers in the rural
areas can be reached out. We see the neighborhood now and ten
years ago there were only huts, now everybody has corrugated roofs
and nice homes, clean water to drink, health centers, schools
everywhere. Things are really changing.
In everything that happens, the state plays a crucial role it nearly
seems omnipresent in the formerly socialist country. Some regard that
as a burden especially because it is involved with a lot of
bureaucracy. When it comes to agriculture though, there are many
voices appreciating the steps the state has taken during the past years
- also Matebu Meskel: The state is doing everything they can honestly.
They are there. They really need our hand because we have the
xxxxxxx
economy. But as such, the government has gone beyond, they have
allowed every possible thing, they have let their benefits go to the
extreme to see something change or what you call in economics
opportunity cost. It wasnt like this before. They werent optimistic, but
today they are there. They are coming every morning knocking at the
farmers doors, so how are you doing today, how is your compost, is it
working? How is your chicken? How is your cow doing, do you need
any help? You know. They do this every day. Farmers are very much
involved now.
Matebu Meskel with his new Massey Ferguson tractor
Of Ethiopias 12 million farmers, only 50,000 have more than five ha

land. For about 6 Euros per ha agricultural land can be leased from the
state for up to 99 years. However, in the same way the state gives
agricultural land to investors and farmers, the state can take it again if
the farm is not productive enough. A total of 400,000 ha has been given
to investors / commercial farms yet. Currently, commercial farms
regularly seem to sprout of the ground especially in the Southern
parts of the country. Michael Tesfaye from Kaleb Engineering - an
agricultural machinery dealer for Claas, Amazone and some other
brands - explains: Most commercial farms are found in West-Southern
parts such as Gambella and Benishangull region. In Gambella alone
there are 150 to 200 farmers. Its a new phenomenon, a lot of people
are getting into it. Ethiopia is working on the mechanization of
agriculture and there are lots of farmers taking land from 100 to 25,000
hectares and they have a high demand for machineries to mechanize
their farms in order to get a very good output. Except for the highlands,
when you go to the Southern, Western, and West Northern parts, there
are a lot of commercial farmers. Because here now more and more
people understand that there is a conducive environment to go into
farming. During the earlier times people didnt want to go into farming
because they thought it was a backward thing. Because the
government is emphasizing on this sector, it is giving you a lot of
incentives. Its giving you the land, its giving you the loan and also
people are getting very good returns on their investments in farming.
First, it was rather foreign investors from India, Saudi Arabia and China
who went into commercial farming in Ethiopia. However, soon disputes
began especially when local small-holders had to be relocated in
order to make land available to the investors or when the foreigners
were eligible to privileges Ethiopians were not able to get e.g. cheap
x
Micheal Tesfaye from Kaleb Engineering
loans. Now the government tries to support both alike: foreign investors
and Ethiopian investors. And the measures have been fruitful already:
by now Ethiopian investors in agriculture outnumber their foreign
counterparts.
However, not all the commercial farms produce efficiently yet, and
when it comes to modern agricultural machinery, it is still rather the
foreigners who can afford high-tech. Due to a lack of capital, Ethiopians
often chose Chinese brands, which are about 30-40% cheaper than
their Western competitors. Exceptions might be Ethiopian investors
who have been able to raise some capital by activities in other sectors
or returning emigrants like Matebu Meskel before starting his coffee
plantation in Ethiopia he had been working in the US for a couple of
years.
Another important customer segment are contractors. They use their

machinery very intensively, that is why they attach strong importance to
quality, spare part supply and service - which often makes them
choose Western brands. Contractors are active in harvesting business
but also in tillage, seeding and plant protection. The farms they work for
are typically between two and ten ha in size and many of them are
located in Southern Ethiopia.
Gibagri Ltd. a farming project by a German investor - recently
switched their focus from cereal farming to horticulture. Nevertheless,
they kept their machinery in order to work for other farmers in the
region. On the side, they now regularly plough and harrow the fields of
about 100 farmers. According to the managing director Marliese
Rothweiler-Spohn, it is important to provide the farmers with a clear
economic calculation in order to convince them to make use of modern
agricultural machinery: We tell them that cultivating one or two ha with
your oxen will cost you about 1,200 Birr. We can plough your land for
2,000 Birr and the Lemken plough will go much deeper and bring more
fertile soil as well as remove weeds much better. This increases your
yield about 30% and is less time-consuming. As soon as they get that,
they are on board.
Another important customer segment for Western ag machinery
manufacturers are state farms. They are a relict from the countrys
socialist past, however they are more modern than one might thing:
their staff is usually very well trained and their machinery parks are
state-of-the-art. Machinery investments are generally realized through
tenders and the price is the final decision criterion. Often tough, the
demands on the technological characteristics of the machinery are so
high that only a couple of high-end producers can deliver.
Gibagris machinery park
In spite of growing customer segments such as commercial farmers

and contractors, still the bulk of Ethiopian farms are very small.
However, growth in other sectors of the Ethiopian economy will
certainly lead to a decrease in the total number of farms and an
increase in the average farm size. Apart from that, more and more
small-holders are affiliated with cooperatives and/or commercial farms
the latter primarily upon government insistence. The deal is the
government helps commercial farms to produce and export by
providing land, loans etc. and the investors help the small-holders by
sharing expertise, input and modern technology. In return, the smallholders pay the investors by their harvest. Cooperatives again have
existed in Ethiopia for a long time. They purchase input together and
sell their produce together. Joint investments into agricultural
machinery are rather new but ag machinery dealers expect
cooperatives to be one of the main future markets. If this rather pricesensitive segment will be primarily serviced by Chinese or by Western
manufacturers though remains open to question.
us: When we give demonstration for teff, the number of people

inquiring is unbelievable. You CAN do teff with combines, so we let
them know that. With the help of ATA (Agricultural Transformation
Agency) and USAID we have tried to show farmers this. This means a
huge potential for us the contractors and the farmers Twenty
people have to be in the field to finish one hectare of teff. And you pile it
there, you wait until the moisture reduces, transport it. Its a long
process and it has a lot of wastage. One hectare teff can be done by a
combine in 15 minutes!
Teff modern technology needed

Teff is a major cereal in Ethiopia. Beer and the famous flat bread Injera
are made from teff. Teff is extremely labor-intensive and agricultural
machines which have been available in the market so far are not really
suitable to handle the small grains and soft stems. Recently though
German producer Schmotzer has developed a specific seeder for teff
which is currently in the experimental stage. John Deere again has
rebuild one of their combine models to make it suitable for teff
harvesting. A couple of weeks ago, they introduced the prototype to
farmers in the area, as Chombe Seyoum from Gedeb Engineering tells
x xxx
Chombe Seyoum from Gedeb Engineering
Exponential market growth

During the past three years, the Ethiopian agricultural machinery
market has tripled. In 2013, about 400-600 new tractors by Western
brands were sold next to several hundred Chinese machines. This
year, Polish ag machinery producer Ursus alone will deliver 3,000
tractors to Ethiopia in the frame of a governmental program. The
average size of Western brand tractors in demand is about 80-120 HP.
Chinese tractors on the market are typically much smaller with 20-50
HP on average. 2013s combine harvester sales are estimated at 70120 units while the demand for major implements such as disc ploughs
probably evolved around 200 units.
Right now, there are two opposite factors influencing the development
of the agricultural machinery market. On the one hand, there is a new
governmental support program: Since 2013 and for a total period of five
years, farms larger than 30 ha can purchase agricultural machinery
with 30% equity only. The rest is financed through long-term credits
with comparatively low interest rates. Micheal Tesfaye from Kaleb
Engineering explains: They will try to see your acre, how many tractors
you will be needing, which type of machineries you will be needing.
They will try to mechanize your farm starting from the primary tillage to
the harvesting. So they have started financing last year, that is why you
see a huge surge in mechanization in Ethiopia. They have Duty Free
advantage as well. On the other hand again, the market is currently
influenced by the deliberate devaluation of Ethiopians currency. The
intention is to support export and direct investments. A side-effect
though are increasing costs for imported agricultural machinery. The
upcoming months will show which of these measures will have the
stronger impact on the market.

x
Micheal Tesfaye on the premises of Kaleb Engineering
Stopover in Asia
In whatever direction the agricultural machinery market is going, for
many Western manufacturers it is certain already that the road to
Ethiopia, or Africa in general, leads via Asia. Machinery produced in
Asia and for the Asian market is usually smaller, less sophisticated and
consequently less expensive. Characteristics which are also crucial in
Ethiopia, especially if not only commercial farms as customer
segments are to be addressed but also contractors, medium-sized
farms or cooperatives. Machines need to be easy to use and to
maintain and they need to be robust Ethiopias infrastructure can be a
challenge to the sturdiest machine.
When we ask Ethiopian farmers and investors why they purchase
agricultural machinery by Western manufacturers, nearly everybody
mentions the supply of spare parts next to better quality. Demesew
Bogale from Gibagri Ltd. explains why: With these cheap brands
[referring to Chinese manufacturers], farmers are purchasing it and
they are taking it to places like Gambella 700 km from Addis and
more. When you go there, when you try to use it, immediately it can be
broken, then it is hard to drive back to Addis, there is not enough
garages and spare parts. Even if you can find the spare parts, they are
also local and when you try to use it, immediately it breaks. You know
coming going, coming going 700 km, really it is not economic. So
Western brands, they are reliable, they are durable.
However, also for Western manufacturers there is still potential for
improvement. Actually only a minority of farmers seem to assess
service and spare part supply by their dealer as really satisfactory.
Chombe Seyoum from Gedeb Engineering explains what kind of
hurdles his company is facing and what they are doing to improve: We
are not coping up with the supply of spare parts and servicing of
tractors as we want. We are working very hard to improve that
shortcoming because the customers should be satisfied in every level
for the equipment they buy. So recently we have built a training room
here and we have assigned a customer service department and we
also give trainings when we hand over tractors. And also we have
imported quite a substantial amount of parts which can at least be used
for regular servicing, not maintenance. We also keep maintenance
servicing parts. And our plan is to bring spare parts three four times a
year and keep it on stock here so that our customers will never ever be
unhappy about the machinery they have. The issue is the system is
insufficient. Not the outside one but the local one. Getting Letter of
Credit is very difficult. The banks are paying and the system they use is
Letter of Credit to pay the suppliers back. So there is some shortage of
foreign currency which is a tentative problem which takes more time for
us to get USD. Once the parts are there, they also have to be cleared.
Customs all these things make it difficult.
Last but not least, we ask Micheal Tesfaye from Kaleb Engineering for
a last advice to German manufacturers of agricultural machinery: They
dont emphasize on the African market as a whole because they think
its insignificant for them but I think in the future they should be
emphasizing in each aspect, they should come here and get a closer
look at the day to day African commercial farmers needs. May be for
the German and European designers, they are always continuously
improving their products, going to the next generation and to the next
but they should focus on Africa. Earlier as I told you, people didnt have
the purchasing power, it was an insignificant market. But now not only
in Ethiopia, but in Sudan, Kenya, Tanzania and any place you go in
Africa, the commercial farming phenomenon is growing. But the needs
of the end users should be kept in mind when you design everything.
They need to improve their products for their customers in Europe.
That is not a bad thing. But also to keep in mind the African market
would be good because other manufacturers are taking over the
markets.
Ethiopia: Quotes by industry experts
3rd
Between 2011 and 2015 probably the

fastest growing economy in the world after
China and India.
They have a German-Ethiopian agricultural

training center in Kulumsa. Companies like
AGCO, Beinlich, Grimme, Lemken, Fliegel and
Rauch are involved there. There are not enough
skilled workers in Ethiopia, so here workers are
trained.
The government plans to lease out 3,3 m ha
farmland in total to private investors. And they want
to multiply their sugar cane production tenfold from
265.000 t to 2,3 m t until 2025. China and India
have already granted credits for that.
They have cooperatives like
the LPGs in former GDR.
Also Ethiopians have large farms now, but

often they do not work because the
farmers do not have the skills or the capital
to really go into large-scale farming.
After South Africa, the largest wheat

producer in Africa and still they need
to import a lot, a part of it is food aid..
The countrys economy is still affected by its
socialist past. Many companies and industries are
still state-owned. Also bureaucracy is complicated,
maybe more than in many other African countries.
With 85 million inhabitants the second

largest country in Africa! And the third
largest agricultural machinery market
in Sub-Sahara Africa.
You have to bring patience, decisions

here just take longer. The Chinese have
figured this out and are successful now,
Europeans often do not have the
necessary patience.
Ethiopia is the only African country which apart from
a short exception between 1936 and 1941 was not
under colonial rule. This seems to make business
between Europeans and Ethiopians easier.
Ethiopia: Agriculture
z
z
z Cereals
3 - 3,5 m t
z Roots and tubers
0,4 0,5 m t
z Maize
3,9 - 5 m t
z Sorghum
2,8 - 4 m t
z Wheat
2,5 - 3,1 m t
z Coffee
0,3 0,4 m t
z Broad/horse beans 0,6 0,7 m t
z Sesame seed
0,2 0,4 m t
z Dry beans
0,3 0,4 t
z Barley
1,5 - 1,8 m t
z Hops
0,03 0,04 m t
} Animal production :
z Cow milk
2,8 - 4,1 m t
z Cattle meat
0,4 0,5 m t
Agricultural area
1.104.300 sq km
} Agricultural land (pot.):
50 m ha
} Agricultural land (in use): 11 m ha
} Irrigated land:
4,5% of cultivated land
Ethiopia: Agricultural Machinery

Agricultural machinery import Ethiopia
in million Euro
70
Global
Germany
60
50
40
30
Tractors
Soil cultivation
Harvesting
Seeding & planting
Irrigation
Transport
Total
41,8 m
3,0 m
4,5 m
7,4 m
0,3 m
1,3 m
0,6 m
3,7 m
62,6 m
20
Updated numbers!!! Agricultural machinery import Ethiopia:
10
2011 42 million Euros
0
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Ethiopia: Agricultural Machinery

z
Kaleb Industries (Claas,

Lemken, Amazone),
Addis Ababa
Gedeb Engineering
(John Deere), Kirkos
Moenco (New
Holland), Addis Abeba
Nazareth tractor
assembly plant
(Belarus assembly)
Ries Engineering
(Massey Ferguson),
Addis Abeba
Gedeb Engineering
(John Deere), Addis
Abeba
Source: http://www.infoplease.com/atlas/country/ethiopia.html
Ethiopia: Fairs and Exhibitions

z
Addis Agrofood
} October 2014, Addis Ababa (annually)
} Organised by Expotim
} http://www.expotim.com/
General exhibition by Chamber of

Commerce
} Regularly at holidays such as Christmas,
Easter and New Years in Addis Ababa
Ethiopia: Basic Country Figures

z
Economy
} GDP 2012: 43,1 billion USD (+7%
compared to 2011)
} Employees: 44 m
} Industries: food processing, beverages,
textiles, leather, chemicals, metals
processing, cement
} Resources: gold, platinum, copper,
potassium chloride, natural gas
Politics and state

} Capital: Addis Ababa
} Administration: 9 regional states
} Head of state: President Girma WoldeGiorgis
Hailemariam Desalegn
} Minister of Agriculture: Wondirad
Mandefro Gebru
GDP
in billion USD
in billion USD
50
43
4,8
40
32
27
30
20
10
5,8
10
12
15
30
32
20
3,4
2,6
3,6
3,7
3,9
4,2
2,8
2,0
2
1
0
0
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Source: World bank
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

z
Demographics
} Total population:
89 m
2,1% (est.)
} Fertility rate:
4 births per woman
35% Oromo, 27% Amhara, 6% Somali,
6% Tigray
} Urban population:
17%
} Below 15 years:
44%
} Illiteracy rate:
57%
Languages
Amharic
Oromo, English + 80 other languages
Religion
}
Major religion:
Christian
Minority religions:
Muslims
Currency
} Name of currency
Birr (ETB)
} Exchange rate:
1 EUR = 25,66 ETB (01/2014)
Ethiopia: Contacts
z
GIZ Ethiopia (also responsible for Kulumsa

Ag Machinery Training Center)
} Hisham Complex (5th floor), Kazanchis
Area, P.O. Box 12631, Addis Ababa,
Ethiopia
} +251 115 516 313
} giz-aethiopien@giz.de
} www.giz.de
Agricultural Transformation Agency

} 7th Flr., Zequala Complex, Jomo Kenyatta
Road, Addis Ababa, Ethiopia
} +251 11 557 0685
} info@ata.gov.et
} www.ata.gov.et
Embassy of the Federal Republic of

Germany
} Yeka Kifle Ketema (Khebena), Woreda
03, Addis Ababa, Ethiopia
} +251 11 1 23 51 39
} www.addis-abeba.diplo.de
Ghana November 2013
Ghana: Interviews
enterprises and to agricultural machinery dealers. This month, we took a closer look at the West African country Ghana.
The coming of the farms has helped a lot

Daniel Asherow is the general manager of Boomart - a 3.000 acre farm
focusing on pineapples and mangos. Boomart is a private limited
liability company with four share holders - three Ghanaians and one
Suisse. According to Mr. Asherow, joint ventures between Ghanaians
and foreigners are not untypical for commercial farms in Ghana. Mr.
Asherow tells us how much change their activities have brought to the
region and how this change, paradoxically, could threaten their farming
activities in the long run: This was a typical rural area. There was no
electricity, road was terrible and the people were mainly peasant
farmers. But now with our coming and other farms coming around,
weve employed a lot of workers. Our coming here has brought
electricity and the development of this road. The farms here have done
a lot of things for the community and speaking of Boomart, weve been
able to put up a three classroom unit block for the community. Apart
from this, there are other things we are doing like make boreholes for
the communities around. For opening up this community, the coming in
of the farms has helped a lot. However, with regards to land, with the
place opening up, development is catching up with the area and estate
developers will start turning their attention to this place and there will be
competition for land. This is one problem the commercial farmers have
started facing. So it will mean having to move to other areas. Mostly,
the chiefs are the custodians of the land and we acquire lands through
them but its the same people that once the estate developers are
ready to give higher prices, they start giving farmers problems.
Daniel Asherow of Boomarts
Boomarts pineapple plantation
Ghana: Interviews
Godfried Atta-Boateng from Unifruits Ltd. is facing similar problems.

Unifruits is a 1,000 acre pineapple farm. For Unifruits, the insecurity in
regard to land rights also affects long-term decisions like the
establishment of a power connection to their farm: For us the problem
now is electricity. We are using a generator set. But electricity
connection has moved all over around us, its closer to everyone now.
We were given a hefty quotation should we want an extension to our
farm. But it is better to use the generator set because we would have to
buy a transformer and eventually when there is human settlement
around, it will no longer be your property. Well an estate developer has
bought the land closer to us. Once it starts like that, people start to
clamor for land space.
take loans and then they pay later when the harvest is up. Those in the
middle class are getting closer to the bigger farms. They help them to
also produce. Sometimes a person may have about 5 to 10 acre
pineapple farms; they may not be exporters but would rather sell their
produce to the commercial export farms. So sometimes the exporter
with tractors have contracts with these medium scale farmers to plough
their land and in exchange give them seeds and chemicals and even
technical officers who helps the smaller farmers to grow so you can
supply them more.
Still the majority of farms in Ghana are below two hectares, however,
medium-sized and large-scale farms like Boomart and Unifruits are
increasingly growing in size. While the smaller farms primarily do
shifting cultivation, commercial farms of 50 up to several thousand ha
usually have long-term leases with the clan chiefs. Officially those
leases are made for 50 years, but as in Boomarts and Unifruits case,
things can change easily if another prospect offers a higher price for
the land.
When it comes to mechanization, it is primarily the large farms which
are well equipped. However, through outrgrower systems more and
more medium-sized farms benefit from the commercial farms
machinery and expertise, as Mr. Atta-Boateng explains: These young
people around are planting and selling to the large farms. Some also
xxxxx x
Godfried Atta-Boateng at Unifruits processing facilities
Ghana: Interviews
Impulse buying instead of long-term orders
The third person we have spoken to is Mr. Amoating - the managing
director of Agro Africa an agricultural machinery dealer selling
Massey Ferguson, Landini, Same Deutz-Fahr as well as a couple of
Asian brands. His company has been in existence for four years and
they have three branches in Ghana where 21 employees and 42
agents work. Mr. Amoating gives us an overview over the tractor sizes
demanded by his customer clientele: For 50 acres, the person does not
need 150 horsepower, a 75 horsepower will be ok. Even 65 horse
power will be ok for the person if he decides not to plough for people.
But here one thing is that they always want to plough for people. So
usually, 75 and above is ok for the people. But the bigger fields needs
higher horsepower but the very big farms in Ghana want to import their
own equipment.
Estimates suggest that about 500 new tractors were sold in Ghana in
2012. Mr. Amoating explains that the government has brought in
various tractor brands in the past starting with Massey Ferguson a long
time ago, then John Deere as well as Landini, Kubota and now Dong
Feng and some other Chinese brands. To Agro Africa, such
government programs often mean competition, because the subsidized
equipment makes Agro Africas machines more expensive in relation.
However, according to Mr. Amoating, farmers purchasing equipment
through government programs often struggle in the end when they
cannot find a place to get servicing or spare parts. So this is where
Agro Africa is trying to stand out. Agro Africas after-sales service is
primarily implemented through two major service-centers in Northern
and Central Ghana as well as several service vans which go from farm
to farm. Apart from that, Agro Africa is trying to stand out by offering
xxxo
Mr. Amoating Agro Africas premises
long-term payment plans to their customers, which run up to two years

and which meanwhile - are used by the majority of their customers.
However, according to Mr. Amoating, even more decisive for business
to run is the number of machines they have ready in place: An African
man will delay, we are always last minute. If a machine is needed in
March, a European will start preparing in November. An African man
will wait till February, then he will come and tell you. So for us,
sometimes you need to have the equipment in place. I told you we sold
20 of the Ferguson this year, if we had about 50, we could have sold all
of them.
Ghana: Interviews
Increasing importance of land preparation
The Boomart farm has light duty tractors for moving equipment like
trailers and boom sprayers as well as heavy duty tractors for land
preparation (up to 220 HP). Mr. Asherow explains: Until recent past,
most farms were relying on up to 120 horsepower. But now for
pineapple, its clear that to get the results you have to work on your
land very well, it requires heavy equipment and that goes with heavy
tractors, therefore most farms are now looking at 180 horsepower and
above for land preparation. Also Mr. Atta-Boateng from Unifruits
confirms the increasing importance attached to land preparation: Now
other farms have also bought ploughs and equipment for tilling and
land preparation. For crops like the MD2 (pineapple sort), if you want
good yields, 50% is with land preparation. If you get it good, the rest is
with fertilization and then you are done. Very good machines are the
trend that till the land such that you cant see any lumps which might
hinder the rooting system of the fruits.
Another topic currently at the center of discussion among Ghanaian
farmers is the quality of machines sold in Ghana compared to
European equipment. So far, Mr. Asherow and his colleagues from
Boomart have primarily purchased new tractors directly in Ghana but
now they are actually reconsidering their strategy: Theres a feeling
that the slightly used tractors from Europe are durable and can perform
better. The new ones, we are informed that they are for the African
terrain but from what weve seen from the used ones from Europe,
most people are beginning to rethink. Also Mr. Atta-Boateng from
Unifruits Ltd. who work with tractors by various Western brands sees this trend: Recently farmers are going in for the used European
models which are better than the new ones we buy.
One of Boomarts tractors + disc harrow
To conclude the interview, Mr. Amoating from Agro Africa wants to give
a last recommendation to European manufacturers who want to
become active in Ghana: The agricultural machinery market will be
boom. There is always trouble in our neighboring countries but Ghana
is stable. So when youre in Ghana, you can move to all these parts.
But if you dont understand the system, the system will swallow you. In
Europe you do things differently, but you need to know the Ghana style.
Any company which wants to dupe you, can provide you with any
document you need but the issue is what is on the ground, not on
paper. Somebody can talk a whole lot telling you what hes doing.
Because hes an action man. So you can partner him. People dont
care about paper work, but in Europe, you care about paper work. So
thats the difference. The whole thing is relax and get the right people to
advice you. Im not saying come to me. There are lots of people out
there. But give them time, have some patience.
Ghana: Quotes by industry experts
An entrance gate to Western

Africa. Positive investment
climate and legal certainty.
Recently, they found out that their oil

reserves are immense. This will
definitely impact the whole economy.
Less complicated than many other African

states! More predictable and transparent
and also politically stable.
Their food industry has been

developing pretty well during the past
years.
Between 2011 and 2015 probably the 8th

fastest growing economy in the world.
When it comes to import of

agricultural machinery, Ghana is
the fourth largest market in SubSahara Africa and the second
largest in West Africa.
Established democracy and
market-friendly economic policy.
Also secure.
Compared to many other West African
countries they speak English that
makes business easy.
There is a plan for a 12 million Euro PPP

together with the German Food
Partnership for the support of rice
production (CARI). And also oil seed
production is to be supported through the
German Food Partnership.
Here, credits from local banks are extremely

expensive after Brazil the highest interest
rates in the world.
Ghana: Agriculture
z
z Yams
5-6mt
z Cassava
12 - 14 m t
z Cocoa beans
0,6 0,7 m t
z Taro
1,2 1,5 m t
z Ground nuts
0,5 m t
z Rice
0,4 0,5 m t
z Maize
1,6 1,9 m t
z Sorghum
0,3 m t
z Millet
0,3 m t
z Chicken meat
32.000 37.000 t
z Cattle
18.000 19.000 t
Agricultural area
} Agricultural land:
} Arable land (% of ag. land):
22.754.000 ha
14.850.000 ha
28%
Agricultural regions
} Cereals: Northern Ghana, Afram Plains &
Brong Ahafo (both Central Ghana)
} Pineapple: Eastern and Central Ghana
} Cocoa: Ashanti, Eastern and Western
regions
} Tubers: Ashanti
Ghana: Agricultural Machinery

Agricultural machinery import Ghana
in million Euro
30
Global
Germany
25
20
15
10

Tractors
Soil cultivation
Harvesting
Seeding & planting
Irrigation
Transport
Total
9,1 m
5,4 m
1,1 m
0,7 m
0,3 m
0,7 m
0,7 m
7,2 m
25,2 m
5
Updated numbers!!! Agricultural machinery import Ghana:
0
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Ghana: Agricultural Machinery

z
Agro Africa (MF, Landini, SDF), Accra

AFRGRI (John Deere), Accra
Mechanical Lloyd (MF), Accra
Agrimat Ltd (Landini, LS), Accra
CFAO Equipment (New
Holland), Accra
Source: http://www.infoplease.com/atlas/country/ghana.html
Ghana: Fairs and Exhibitions

z
West Africa Agro

} 02.-04.12.2014 Accra (annual)
} Organized by Fairtrade Messe
} www.agrofood-westafrica.com
FAGRO The National Food and Agric Show

} October 2014 (annual)
} www.fagroghana.com
Ghana: Basic Country Figures
GDP
in billion USD
in billion USD
45
39
30
25
29
41
32
17
13
15
26
20
15
20
11
10
10
5
8
2
0
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Source: World bank
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

z
Economy
} GDP 2012: 40,1 billion USD
(+8,2% compared to previous year)
} Industries: mining, lumbering, light
manufacturing, aluminum smelting,
food processing, cement, small
commercial ship building
} Resources: gold, industry diamonds,
bauxite, manganese, crude oil, silver,
salt, limestone
Politics and state

} Capital: Accra
} Administration: 10 regions
John Dramani Mahama
} Minister of Agriculture:
Hon. Clement Kofi Humado

z
Demographics
} Total population:
26 m
2,3% (est.)
} Fertility rate:
48% Akan, 17% Mole-Dagbon, 14% Ewe,
7% Ga-Dangme, 6% Gurma, 8% others
} Urban population:
52%
} Below 15 years:
39%
} Illiteracy rate:
29%
Languages
English
79 other languages, among them Akan,
Ewe, Abron
Religion
}
Major religion:
Christian
Minority religions:
Muslim and natural religions
Currency
} Name of currency
New Cedi (CHS)
} Exchange rate:
1 EUR = 3,17 CHS (12/2013)
Ghana: Contacts
z
Delegation of German Industry and

Commerce in Ghana
} Mezzanine Floor, World Trade Center
} P.O. Box KA, 9227 Accra
} +233 30 701 12 07
} Patrick.Martens@ghana.ahk.de
} http://ghana.ahk.de
GIZ Office Ghana

} German Development Cooperation House
} No 7 Volta Street, Accra
} +233 302 777375
} giz-ghana@giz.de
German Embassy
} Osu Kolltey
} Accra
} +233 21241082
} www.accra.diplo.de
Agro-Corps Ghana
} La Maison des Associations, 1a place
des Orphelins, 67000
Strasbourg, France.
} +33 (0) 3 8883 5801
} www.agrocorpsghana.com
Zimbabwe October 2013
Zimbabwe: Interviews
enterprises and to agricultural machinery dealers in order to be able to see things with their eyes. This month, we took a
closer look at the South African country Zimbabwe.
Tobacco the in thing
Zimbabwes agricultural sector has been going through immense
changes in the past two decades. Most influential was the land reform
which, in the year 2000, forced white commercial farmers out of the
country. The land and the farms were confiscated by the government
and redistributed among the black population. Today, the sector is
rather small-structured, however, large farms still exist, like the one of
Ernest Chiwaridzo. He got his farm in 2003 and has been using his 130
ha to produce potatoes, maize and soybeans. He says he has been
focussing on these crops in particular because it has been rather easy
to find markets for them, but the trend now seems to go somewhere
else as he explains: Currently, tobacco is leading the market, most
people are going for tobacco. Maize people are not actually growing
more maize because of the prices. The prices are too low.
Randy together with the interview moderator Farmecs sales office
Randy Pote, who works as a salesman for Farmec an agricultural

machinery dealer in Harare agrees and also explains how they adapt
their machinery range to this trend: The tobacco industry is booming
now. We are getting good sales and we hope in the near future this
trend will be going up. Weve noticed that about seventy percent of the
tobacco that Zimbabwe is producing is coming from small scale farmers
and unfortunately weve been neglecting this market segment. So were
actually working on the products or the size of tractors or the right
implements for this small scale farmers because thats where the bulk of
the tobacco sales are coming from.
Ernests farm
Good potential, not enough capital
Also Gift Hwenje, owner of a 110 ha farm close to Harare, is interested
in tobacco production. He got his farm only last year. After working all
his life as a surveyor in construction business he finally realized his
dream and started life as a farmer. He actually planned to produce
maize and tobacco in a big way, however now he feels limited through
financial constraints: As we speak I havent got enough seed and
enough fertilizer. I dont know how much money I am going to get from
other sources where I work, so that will determine how much I will buy
to put down, but I really expected to come up with lets say fifty hectares
of maize and I was expecting to put ten hectares of tobacco. Really
the problem is we have got no where to get funds from at the moment. I
tried a bank, they turned me down and there is no where else to get
funding from, so doing it from your pocket, I wouldn't do as much as I
would love to, I just do what my pocket can do. If banks were borrowing
money, I think things were working. Other farmers we talk to, its always
this story of where would we get that money. If we had money, we
would develop these farms.
Since Zimbabwes land reform, the development of farms has been

regulated by the state. Land is not for sale but distributed for free by the
government. However, as the farmers do not have title deeds to their
pieces of land, accessing money from financial institutions is very
difficult. Also Ernest complains about the consequences the lack of
capital has on the productivity of his farm: This coming season is a bit
of a challenge because of banks - we are not getting funding on time.
By now we should have finished all the land preparation. In my case I
have irrigation - I should have other crops being irrigated right now but
as it is we have to wait for loans and stuff but time is not on our side as
farmers. Farming is about time so if you get your loans late the truth of
the matter is you wont be able to pay back loans. The other challenge
we are having, they dont give you the money to go and buy, they give
you vouchers to go to the manufacturers of fertilizers, seed houses and
stuff, but when you go there at times, you dont get the inputs that you
are looking for because they say we are after strictly cash. For
farmers without cash you have to wait a little bit longer but this will lead
to crop failure because the rains would have started by the time you are
given the inputs. When I started, actually wasnt borrowing money, I
was using my own money, so it was easier, I could buy things on time,
get good yields, proper planning for everything but now the problems is
loans. I think as a farmer, if funding was to be made available on time,
we could actually produce more and make this country a stable country
and export quite a lot because we have got in my view the best
temperature, the best weather, the best everything that is conducive to
farming.
Gift shows his new farm
Also Randy, the salesman at Farmecs, confirms that the unavailability
of funds is a serious issue in Zimbabwes agricultural sector at the
moment. However, this does not necessarily apply to all customer
segments: The issue of finance is quite tight in the country, as we
speak people come complaining of high interests rates from banks but
in most cases financing is very low. Guys tend to finance themselves
from their own crops, but then we have got farmers who are being
financed by contractors. Tobacco guys normally grow tobacco for
certain companies who in turn buy tractors for them mostly. Like I
mentioned tobacco now is the in thing and most sales are coming from
tobacco, so mostly funding is coming from these contractors.
300 new tractors and a large second-hand-market
Farmec the company which Randy works for has been in existence
for the past sixty years. Apart from Massey Ferguson tractors, they are
selling a wide range of agricultural machinery by companies like
Monosem (US-American planter manufacturer), PICCIN (Brazilian
manufacturer), IMKO, Vicon (Kverneland) and FEDE (Chinese sprayer
brand). Randy assumes that per year about 300 new tractors are sold in
Zimbabwe mostly between 55 and 100 HP. Sales volumes in
implements again are much smaller and usually do not exceed 30 units
per product group per year, he assumes.
The two farmers we spoke to cannot afford new agricultural equipment

so far they purchase their equipment at auctions or from companies
which rebuild used agricultural machinery. Ernests machinery park is
about 15 years old and comprises an 80 HP Landini tractor, a plough, a
disk harrow, a ridge, a roller and a ripper next to two planters and two
trailers. However, he does not consider his equipment to be complete
yet: Talking to other people on harvesters, I was recommended Claas.
I even wanted to buy that one but couldnt afford it by that time.
Because these days labour is a challenge, you need to have your
harvester by your side. Apart from that, the next things I would like to
buy are a planter and a four wheel drive tractor for land preparation.
Also Gift is not poorly equipped compared to other farmers in
Zimbabwe: I have two tractors, a Massey Ferguson with 85 horse
power and a 2850 John Deere and Ive got two ploughs, a disc harrow
and a planter, I have got a Vicon and I also bought that dam scooper
which I am using to construct a dam and Ive got that trailer. Look they
are old, Ive bought some rebuilt tractors, I went to some places where
they built old tractors. The disc harrow that I have is not mine, I
borrowed it from a friend last year but he is asking for it now and I think
I am gonna return it. I do need a combine harvester. My idea is I wanna
use more machinery than labour, then I have operators not general
labourers. Thats what I would love to do.
Gifts Massey Ferguson
Ernests Landini
Tractor displayed at Farmec
Zimbabwe: Quotes by industry experts
Immense agricultural potential, but it is

hard to realize this potential, especially
in this tough political environment.
Today Zimbabwe is more stable than

many people think but it is uncertain
what the future brings.
Not much influence from outside

no foreign investors in agriculture.
Before 2000, Zimbabwe was South

Africas bread basket. They had 6.000
commercial farms, now there are about
500 left. But meanwhile the smaller
farmers are doing better and better.
As part of SADC, no trade barriers with

other Southern African countries. That is
an advantage.
Zimbabwes population is relatively well
educated compared to many other African
countries.
They use US Dollars that makes many

things easier.
Zimbabwe: Agriculture
z
z
z Maize
1,2 1,5 million t
z Tobacco
90.000 110.000 t
z Cotton lint
40.000 90.000 t
z Sugar cane
3,1 million t
z Cotton seed
70.000 170.000 t
z Cassava
200.000 230.000 t
z Soy beans
50.000 90.000 t
} Animal production (in thousand tons):
z Cattle meat
90.000 105.000 t
z Cow milk
390.000 400.000 t
z Chicken meat
60.000 65.000 t
z Pig meat
31.000 t
z Hen eggs
30.000 t
Agricultural area
} Agricultural land:
390.760 sq km
42%
11%
Zimbabwe: Agricultural Machinery
Agricultural machinery import Zimbabwe

in million Euro
30
Global
Germany
25
20
15
10
5
0
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Zimbabwe: Agricultural Machinery

z
FARMEC (Massey
Ferguson), Mvurwi
AFGRI (John Deere),

Harare
FARMEC (Massey
Ferguson), Bindura
William Bain (New

Holland), Harare
FARMEC (Massey
Ferguson), Chinhoyi
FARMEC (Massey
Ferguson), Harare
FARMEC (Massey
Ferguson), Marondera
Source: http://www.infoplease.com/atlas/country/zimbabwe.html
Zimbabwe: Fairs and Exhibitions

z
Harare Agricultural Show

} August 2014Harare (annual)
} Organized by Exhibition Park Harare
} http://www.exhibitionpark.co.zw/
Zimbabwe International Trade Fair ZIFT

} 22.-26.04 2014 Bulawayo (annual)
Zimbabwe: Basic Country Figures
GDP
in billion USD
in billion USD
15
10
10
2,6
2,2
11
2
1,3
1,3
1,4
1,4
1,5
1,5
1,6
1,8
0
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Source: World bank
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

z
Economy
} GDP 2012: 10,8 billion USD
(+5% compared to previous year)
} GDP agriculture: 20%
} Industries: mining, steel, wood products,
cement, chemicals, fertilizer, clothing and
footwear, foodstuffs, beverages
} Resources: coal, crome ore, asbestos,
gold, nickel, copper, iron ore, vanadin,
lithium, tin
Politics and state

} Capital: Harare
} Administration: 8 provinces + 2 cities
} Head of state: President Robert
Mugabe
Morgan Tsvangirai

z
Demographics
} Total population:
13 m
4,4%
} Fertility rate:
70% Shona, 13% Ndebele, 6% Chewa
} Urban population:
39%
} Below 15 years:
39%
} Illiteracy rate:
16%
Languages
English
Shona, Ndebele
Religion
}
Major religion:
Christian
Minority religions:
Indigenous beliefs
Currency
} Name of currency
US Dollar (USD)
} Exchange rate:
1 EUR = 1,35 (11/2013)
Zimbabwe: Contacts
z
German Embassy in Harare

} 30 Ceres Road
} Avondale, Harare
} +263 4 308 655
} www.harare.diplo.de

Commerce and Industry
Johannesburg
} +27 11 48 62 775
Agricultural Section of the German

Embassy in South Africa
} 180, Blackwood Street, Arcadia
} Pretoria 0083, P.O.Box 2023
} Pretoria 0001
} +27 (0) 12 / 4 27 - 89 29
} www.pretoria.diplo.de
Mozambique September 2013
Mozambique: Interviews
enterprises in order to be able to see things with their eyes. This month, we took a closer look at the South East African
country Mozambique.
Good potential, increasing support, yet some hurdles

Uday Mandavia is the manager of a 1.000 ha farm near Nampula the
economic center of Northern Mozambique. Only three months ago,
together with some other Indian investors he started the farm which is
supposed to focus on maize cultivation in future. Currently they are in
the middle of clearing and preparing the land and building up an
irrigation system. When we ask Uday why he is here, it seems easy for
him to answer: There is a lot of development taking place.
Mozambique in comparison to Africa is among the top 10 and that
interests a lot of people. Moreover the government is helping a lot and
that is why they are growing. There have been lots of constructions that
have helped as well.
Also Miguel Fortes owner of a 50 ha farm focusing on maize,
cassava and horticulture - appreciates the recent efforts by the state
when it comes to the support of the agricultural sector: The
government is contributing in a very big way to the farmer. They are
trying to address the areas where we used to struggle in the past. I was
given a greenhouse focused for the production of plants. In essence
these are farming technologies that we only used to hear about, or
would see on television but now government has made them available
to us. So they have provided the greenhouse, we shall produce the
plants and we shall repay in the work that we do. This is a massive
step. A lot has changed. Nowadays there is a lot of talk of agriculture
and government has seen that agriculture is the basis of the national
development of the country. They introduced in the provinces funds
that have brought numerous great benefits in the agricultural sector as

well as other sectors. These days government is importing machinery
and they are supporting some farmers. In the agricultural sector;
especially in the northern region, we had no access to that technology.
It was hard to get but these day that has changed, government via
some forms of funding are financing some machinery directed towards
the production of soya which was a crop that we were never used to
producing in our region. These
days we now produce soya,
there is a great demand and
impact that stems from it. Thus
there are some farmers that
are being supported in the
financing for machinery with
their respective equipment
such as tractors, sowers,
planting machinery, ploughs
and the like; all the complete
machinery as required. All that
benefits the farmer in the
reduction of manual labour
which means that these days
the farmer would only need
20% of the labour that it used
before.
Miguel Fortes on his farm
But especially for foreign investors, not everything is as uncomplicated
as might have been communicated by the government. Uday explains
his experiences: In regards to agriculture, some of the laws do not
really make sense with respect to foreigners. We need someone to run
one of the equipments but we cannot find one for that around here. We
also need agricultural technicians and none of them exist around here.
So when we want to hire some workers then its a real hustle. They
need so many different documents which end up becoming a
hindrance. The level of skilled labour is very scarce; most of them are
illiterate. So the lack of certificates for the skilled labour force or the
lack of skilled labour can hurt a company. Yet the ministry of agriculture
placed an advert in the Indian newspapers stating that we should invest
in the country and land shall be made available. They mentioned a lot
of things with many promises. However, when we get here we find that
there a lot of things we have to pay for. It first seemed free but most of
the taxes come from the port. This is not a small project. There are no
operators of the machines; there might be some but there are just a
few. If we ask for an operator to be brought from India then its a
problem. Even if we have 50 Mozambicans working here, and we ask
to have 7 to 8 foreign workers then they prohibit it.
At the moment everyone is buying farms

Jose Pinto, a Mozambican national who owns several farms across the
state, provides a good overview over the structures in agriculture in
Mozambique: Most farms are rather small; such farms are typically 1-3
hectares. These belong to farming families. Most use human power to
plant, sometimes they rent or sometimes they use tractors or animal
power. They produce food to feed the families and any excess is sold.
A typical medium farm has the same characteristics as the small farm
but the size ranges from 5-20 hectares. They produce horticulture,
fruits, cereals, cotton, oilseeds (soybeans, castor) etc. They make use
of human power and rent machines for ploughing though some have
antique farm machinery and others have newer ones. The larger farms
are normally 25 hectares and above. Very large agricultural companies
now exist that require extensive capital and technology; these are
normally larger than 50 hectares. They are owned by foreign investors
and some nationals; these are capital and technologically intensive
activities. These are usually commercial units that produce in
accordance to market demand in the area of vegetables, livestock,
forests, sugar cane, cereals etc. They have their own equipment or
rental machinery support in the case of cane sugar. Nevertheless it is
important to note that Mozambique only has a few agricultural
machines at the moment. Equipment is being introduced in the
agricultural sector gradually. The largest farms are located in the
southern and central regions of the country (Manica Corridor, Gaza,
Maputo and Zambezia). Agricultural enterprises in the forestry sector
(hundreds / thousands hectares), sugar (50 to thousands of hectares),
and bananas (50-2000 hectares) are the largest farms. The number of
farms is increasing in an interesting way. I am facing greater
competition. In the last fifteen years the number of businesses grew in
production, especially in seeds, fertilizers, and machinery and farming
implements for example. There are now regular agricultural fairs and
agricultural markets that are local, regional and international. The
competition is being dictated by market requirements.
Land belonging to Uday Mandavias new farm
Uday adds: In Beira there is an area near the ocean where there are
big farms there and they are producing sugar cane there. Besides that
one, then its ours that is the largest. There is also a company that I
heard that is producing Castor oil which has just began. I also heard
one in Quelimane that is also producing Castor oil. There are a number
of big farms now in Mozambique .They are larger than 300 hectares.
Most of them are foreigners; you could say 80% are foreign owned and
the rest are Mozambicans. There are a lot of Indians that I have a list of
that are interested in farming here. I have a lot requests from them.
Next year I am going to India to contact those people. Mozambique is a
country that is growing a lot and the government helps a lot. So once I
have had the opportunity to speak to those companies then many of
them shall enter the market in the near future. There are a lot of people
that are interested; even Mozambicans are interested. Many people
have come to learn and see what are doing; in fact we even end up
teaching them as well. I actually asked the agricultural director to send
a team here to learn from us when we begin planting. That would
create an opportunity for them to learn how the work is done; and even
the population would learn how the work is done. Also Miguel Fortes
observes these developments in the agricultural sector in Mozambique:
I hear that there are lots of farms being developed in Maputo, but that
is happening in the whole country from the south to the North. At the
moment everyone is buying farms, building houses and so on.
really growing and many companies are coming in. Most of these
companies are coming to Maputo but you still do not really see them in
Nampula. Only Entreposto sells tractors here. I will bring a company
shortly from India that will have all the types of equipment. Some of its
employees have already arrived last month. Those machines will be of
a better quality and cheaper.
When Jose Pinto thinks of agricultural machinery in Mozambique,
basically five brands come to his mind: Massey Ferguson, John Deere,
Deutz, New Holland and Ford: They are well known in our market, and
there are companies around that supply spares parts and some provide
technical assistance. They have proved that in the Mozambican
market. There are others that are not that known. They have to gain
market share; especially the brands that come from India and China.
These are the new brands. In general, there are some new things in the
market; larger agricultural machinery, operations that require plant
protection products and crop production. More and more 4x4 tractors
and farm implements are being bought. The agricultural machinery
market will grow a lot.
The agricultural machinery market will grow a lot

As Udays farm is only three months old, not all the necessary
equipment has been purchased yet. The agricultural machinery they
already possess has been bought in India. In fact, Uday plans to
establish an Indian equipment dealer in Nampula: At the moment we
have two tractors, one is Massey Ferguson and a John Deere. Most of
our machinery is bought from India because we know that there arent
a lot of spare parts available here. So we thought it best to buy
everything from India. We buy it directly from the factory. The country is
Uday Mandavia with his John Deere tractor
Miguel Fortes and Miguel Santos born in Mozambique and owner of
a 20-ha maize and potatoe farm close to Nampula - see the market
from a different perspective. Their farms are much smaller and they do
not possess the means to purchase equipment like Uday and Jose.
However, also they found ways to make use of the advantages of
agricultural machinery. Miguel Fortes bought a broken tractor from a
friend and repaired it. Miguel Santos again got the opportunity to hire a
New Holland tractor from the state, which he needs to pay monthly. He
appreciates the support by the government very much: I now have a
water pump, I have a tractor which I lend to my friends and there is
some remuneration that I use to pay for the labour, preparing the land
and buying fuel Those NGOs - we are not even sure on whose behalf
they come. Nevertheless I think the government is working with them so
that they provide support because I
heard that the government went to
Asia and South Africa to create
some form of cooperation so that
some machinery can come through.
For instance, I do not know where
my machines came from but I
benefited from them since its the
government that facilitated the
process There was some funds
that were made available and some
farmers were finance indeed. If they
did not perform then it cannot be
blamed on the government. I am
paying my portion of the loan that I
took from that fund. This is
something that we can be grateful
for We do not receive any
subsidies, the money we received
we are paying back but we are
Miguel Santos with his hired tractor
thankful for it.
Both Miguel Fortes and Miguel Santos plan to purchase or hire further
equipment for their tractors. In their decision patterns in regard to
agricultural machinery investment not only their personal needs but
also those of other farmers in the community play a role. Miguel Santos
explains: My first thought is on increasing my produce, how to develop
and every single question has to be answered with respect to that.
Moreover I would be able to help my fellow farmers. So that is my
platform when thinking about a machine. My central objective is that.
Currently, when my neighbours have no means, they come and ask for
assistance from us and we go there provide land preparations
assistance. I go there and provide tillage and harrowing.
So far, Miguel Fortes uses his tractor mainly for field preparation for
planting and harvesting he works with seasonal laborers. He has been
satisfied with his old tractor for a long time, especially because he
considers it uncomplicated and esay to repair, but he is also impressed
by the new machines he sees in the market:Now we are seeing
machines from John Deere, there are tractors coming from China as
well, there are some from Brazil that are being introduced. I would like
to buy a bigger tractor, one that is four wheel drive and that has its
respective accessories for ploughing, preparing the land, with a small
harvester with it. It would increase my area of production and I would
also use it to work on the farms of my neighbours. The improvement
would be in increasing the production area, reduce the manual labour
in the planting section as I would have specialised machinery to do
that, and all that together means I can boost my profits and viability.
Therefore I would also ensure that the neighbouring farms get to
benefit from my machinery.
Mozambique: Quotes by industry experts

Between 2011 and 2015, Mozambique will
probably be the 4th fastest growing
economy in the world after China, India
and Ethiopia.
As part of the German Food Partnership oilseeds

cultivation is supported in Mozambique.
Many people only speak Portuguese, that

makes business a little more complicated.
So far, agriculture is very small-structured, but

more and more investors from abroad are coming
to Mozambique especially from South Africa and cultivate huge areas. 100 South Africans,
which have organized in the farmers association
AGRIMOZ, cultivate 600.000 ha in Mozambique.
Another large agricultural company is Nitori and
the largest agricultural engagement is
ProSAVANA which plans the development of
about 14 million ha land in the Northern provinces.
They recently found huge gas and coal sources in the

long run, this can have a positive influence on the
development of Mozambiques infrastructure. But it means
opportunity and responsibility a the same time - in order to
put the country onto a sustainable growth path.
Politically stable and a business-friendly

government, though sometimes a little
erratic and the administration is not too
inefficient.
As part of SADC, no trade barriers with

other Southern African countries.
With a view to the map and
Mozambiques North-Southorientation, you know that only a
regional approach can make sense.
Good transport connection to Gauteng
South Africa, but otherwise
infrastructure is one of the weak points
as well as the shortage of skilled
workers.
Only 15% of fertile land is

used, which leaves 49 million
ha idle lots of potential.
Nearly all products such as maize, potatoes

and wheat are still imported. The largest
exports are sugar, cotton and cashew.
Mozambique: Agriculture
z
} Crop production:
z Cassava
z Maize
z Pulses
z Sugarcane
z Tobacco
z Cashew nuts
z Dry beans
z Rice, paddy
z Sesame seed
z Sweet potatoes
z Sorghum
z Cotton lint
z Ground nuts
z Pigmeat
z Chicken meat
z Cattle meat
z
5,5 - 11 million t
1,6 - 2,2 million t
190.000 - 230.000 t
2,2 - 3,4 million t
60.000 - 70.000 t
60.000 - 120.000 t
130.000 - 200.000 t
180.000 - 270.000 t
60.000 - 110.000 t
850.000 - 900.000 t
380.000 - 410.000 t
36.000 - 62.000 t
ca. 160.000 t
Agricultural area
} Arable land potential:
} Under irrigation:
799.380 sq km
36 million ha
6 million ha
3%
90.000 - 100.000 t
38.000 - 48.000 t
18.000 - 19.000 t
Mozambique: Agricultural Machinery
Agricultural machinery import Mozambique

in million Euro
20
Global
Germany
15
10
5
Tractors
Soil cultivation
Harvesting
Seeding & planting
Irrigation
Transport
Total
5,9 m
1,6 m
1,5 m
1,1 m
0,3 m
0,2 m
0,1 m
3,8 m
14,5 m
0
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Updated numbers!!! Agricultural machinery import Mozambique:

Mozambique: Agricultural Machinery

z
Agricultural machinery dealers (examples)
Entreposto Commercial de
Mocambique (Case, Massey
Ferguson), Maputo
SOTEMA (Valtra), Maputo

Barloworld Equipment
(Massey Ferguson),
Maputo
Trak-Auto (John Deere),
Maputo
Maquinas e Tractores de
Mocambique (New
Holland), Maputo
Jfstecnica Industrial (New
Holland), Maputo
Source: http://www.infoplease.com/atlas/country/mozambique.html
Mozambique: Fairs and Exhibitions

z
FACIM Maputo International Fair

} 25.08.-31.08.2014 Maputo (annually)
} Organized by Mozambican Institute for
the Promotion of Exports
} Contact for German Pavillion DEGA
EXPOTEAM
} www.facim.org.mz
Mozambique: Basic Country Figures
GDP
in billion USD
in billion USD
14,6
15
12,6
9,9
10
4,7
5,7
6,6
7,1
8,0
9,7
9,3
5,2
5
4
2,7
3
2
1
0,3
0,2
0,1
0,2
0,4
0,6
0,9
1,0
0
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Source: World bank
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

z
Economy
} GDP 2012: 14,6 billion USD (+7,5%
} Industries: aluminum, petroleum
products, chemicals, textiles, cement,
glass
} Resources: coal, titanium, natural gas,
hydropower, tantalum, graphite, gas
Politics and state

} Capital: Maputo
} Head of state: President Armando
Guebuza
Alberto Vaquina
} Minister of Agriculture: Jos Condugua
Antnio Pacheco

z
Demographics
} Total population:
23 m
2,2% (est.)
} Fertility rate:
40% Makua, 21% Tsonga, 12% Yao, 11%
Makonde
} Urban population:
31%
} Urbanization rate 2010-2015 avg:
3,1% (est.)
} Below 15 years:
43%
} Illiteracy rate:
52%
Languages
Portuguese
Swahili, Makhuwa, Sena
Religion
}
Major religion:
Christian
Minority religions:
Muslim
Currency
} Name of currency
Mozambican New Metical (MZN)
} Exchange rate:
1 EUR = 0,025 MZN (10/2013)
Mozambique: Contacts
z
GIZ Mozambique
} Lorenz.petersen@giz.de

Johannesburg
} +27 11 48 62 775

Embassy in South Africa
} Pretoria 0001
} +27 (0) 12 / 4 27 - 89 29
Germany Embassy in Mozambique

} Rua Damio de Gis, 506
} Maputo
} +258 2148 27 00
} v@mapu.auswaertiges-amt.de
} www.maputo.diplo.de
CEPAGRI - Centro de Promoo da

Agricultura
} Rua da Gavea n 33
} 1 andar Maputo
} (+ 258) 21 300 626
} cepagri@cepagri.gov.mz
} www.cepagri.gov.mz
South Africa August 2013
South Africa: Interviews

enterprises and to agricultural machinery dealers. This month, we took a closer look at the land at the Cape: South Africa.
We will start mechanizing rather than pay that expensive loan

How is the mood in agriculture in the different African countries? What
are the major developments? How is the situation on the agricultural
machinery markets? To answer these questions, we regularly speak to
the managers of local agricultural enterprises in order to be able to see
things with their eyes. This month, we took a closer look at the land at
the Cape South Africa.
Louis Fchooling is the owner of a 600 ha farm in Free State about
400 km South West of Johannesburg. He mainly focusses on wheat
and corn and started a feedlot recently. Currently, he is occupied with
the dry weather in his region: With this draught you can't really plan as
you want to. That is why we started feeding cattle as this will carry us
through the more difficult times. This year, we did plant wheat, but
when it became so dry we've put the cattle in the wheat fields. Also
Emile Gleimius, owner of a 400 ha farm and concentrating on green
grass, corn and wheat, is not happy with the recent weather conditions:
Everybody could only harvest half of what they anticipated. What
makes things worse is the input costs. Most people just broke even.
For the next harvest, it is unsure what will happen. I expect a difficult
time ahead, everyone could only put in a little bit, and it is under
irrigation. We could not yet plant in the dry lands as we did not get any
rain. We sit around waiting for rain.
Good harvest results in the South and East, drought in the West
and Center
As many farmers in Free State might feel like Louis and Emile right
now, the situation in the South and East of South Africa is the contrary.
Rain was sufficient here and most of the farmers were able to yield an
even larger crop than in 2011/2012. Only the weather in North West
province has been even worse than in Free State. Here the drought hit
the farmers strongly. Their maize harvest was nearly halved.
Louis Fchooling on his farm

White farmers feel neglected
But not only is the weather on the farmers minds right now. Many are
occupied with the political direction South Africa is taking, especially in
regard to land reform. Land Reform stands for a couple of programs
which are supposed to undo the unequal distribution of land during
Apartheid. One of the programs aims at enforcing that those who lost
land rights because of socially discriminatory laws during Apartheid
either get back their land or receive adequate monetary compensation.
Another program again foresees the distribution of land to the poor for
residential and productive use. Therefore, land is either purchased from
the private owners or communal land is being commercialized. So far,
owners of land and farms could freely decide if they were willing to sell
or not. However, as not many white farmers have sold their land yet,
the willing-buyer willing-seller system is being put into question. What
causes much concern among the white farming community is the fact
that in South Africa the state actually has the right to expropriate
farmers against monetary compensation. Also Charne Louw, another
farmer we spoke to, feels uneasy about this topic: We are scared of
government taking away our farms. They just take the farms and it is
something to worry about. What will happen if we become the second
Zimbabwe?
As Charne, many white farmers seem to feel neglected by their
government. She continues: We need to be compensated, we need to
receive subsidies. The farmers in other countries receive subsidies,
why not us? The new black farmers get subsidies. They get subsidies
for everything they might need. For example, this one specific dairy
farm was taken over by governments new black farmers. They took
over the farm as is, but received brand new implements. They got
everything for free, they could just use the farm as-is, to carry on. But
the whole farm is destroyed. There is nothing left, no buildings, no
livestock, no machinery. The new tractor was taken apart and sold for
scrap metal. That New Holland is around three hundred, four hundred
thousand rand. And they get it for free.
Emile feels similar: At this stage its not easy being in agriculture as all
the prices went up but you get next to nothing for your produce. The
government does not give any subsidies; they don't assist in any way.
The agricultural sector is neglected. A lot of farmers left farming, there
are a lot less farmers. We used to be thousands and more dairy
farmers in the Free State. There might not even be fifty left. Indeed, as
a consequence of the extreme price pressure, the high crime rates
among the farming community and increasing tasks and restraints in
the frame of the governments Black Economic Empowerment, many
white farmers have left the country to start agriculture someplace else.
As these farms are usually bought by other farmers, the average size
of commercial farms in South Africa is on the increase. Currently, there
are about 37,000 commercial farms in South Africa - primarily in the
hands of white owners - with an average size of 1,200 ha.
Charne Louw - corn and wheat farmer close to Bloemfontein

Raise of minimum wages leading to mechanization
Also with the aim to improve the economic situation of the black
population, the government recently increased the minimum wages of
farm workers. What seems an improvement for this part of the
population, at least at first sight, is perceived by farm owners and
managers as a threat to their economic viability. Charne puts it like this:
The thing that bothers me around politics is the minimum loan that we
must pay the workers. They are becoming very expensive, the salaries
are killing us. We will start mechanizing, rather than pay that
expensive loan. The lady who works with this [referring to South
Africas agricultural minister], she didn't go to the farmers to ask them
whether they can afford the R105 [about 8 Euros a day], she just made
it the minimum loan without any background knowledge. That is the
amount, whether you can afford it or not. One machine can do the work
of two workers easily. Also Louis is of the opinion that the higher costs
for labor will increase mechanization: The workers are getting big
salaries. Right now there were no harvest due to the dry weather, but
we still need to pay the workers their big salaries. At this stage
everybody is leaning towards implements which require the least labor,
but are the most productive. We are trying to mechanize. When I read
the Landbou Weekblad, I saw that more people are buying new
equipment in order to mechanize. Indeed, the developments on the
agricultural machinery market confirm that: In the past year, with about
720 million Euros, the market volume for agricultural machinery has
been the highest ever.
When asked about the future, Louis says: I don't know what to expect
in the next ten years, I just think it will be chaotic. But if we can carry on
as-is, it will be bearable. Emile sees two options only: Farmers will
have to make drastic plans or think of new ways to make a living from
something else than farming. In the Cape they started to mechanize.
South Africa: Agriculture

z
Agricultural area
1.220.000 sq km
} Agricultural area:
82%, of that:
z Arable farming:
3,5 m ha
z Under irrigation:
9,5%
} Agricultural regions:
Free State, Mpumalanga, North West
Agricultural holdings (commercial farms)
} Total number:
45.800
} Average size:
1.200 ha
} Crop production:
z Maize
z Grapes
z Sugar cane
z Potatoes
z Wheat
z Maize
z Sunflower
z Fruit
z Cattle meat
z Chicken meat
z Cow milk
z Pig meat
z Hen eggs
z Sheep meat
7-10 million t
1,7 1,8 million t
19 20,5 million t
1,8 2 million t
2 2,1 million t
300.000 350.000 t
500.000 900.000 t
750.000 800.000 t
1 1,2 million t
3 3,2 million t
150.000 250.000 t
400.000 500.000 t
100.000 130.000 t
South Africa: Agriculture

z
Some background facts

} Only 13% of South African soil can be used as arable land because large parts of the country
are arid. However, on the arable land available almost all arable crops can be cultivated.
} Almost 90% of agricultural production is realized through commercial farms, which are capitalintensive and export-oriented. The average size of a commercial farm is 1.200 ha and in total
they cover 87% of agricultural land in South Africa.
} South Africa is worldwide the 6th largest producer of green maize and the 11th largest producer
of cereals.
} The South African government has set a target of transferring 30% of productive farmland from
white South Africans to 'previously disadvantaged' blacks by 2014.
} Since end of 2013, even foreign investments are not protected anymore by Investment
Protections Agreements. For example, the agreement with Germany was terminated in
November 2013. Consequently, South Africa can expropriate investors without having to
compensate them with the equal value.
South Africa: Agricultural Machinery

Indicators agricultural machinery Unit
2007
2008
2009
2010
2011
2012
64.425
67.656
68.773
m
m
m
340
164
9
409
209
20
304
134
17
334
136
22
519
259
32
566
262
65
m
m
m
5
1
0
8
1
0
5
0
0
10
1
0
8
0
0
7
0
0
347
208
16
27
33
38
5.084
-9
506
304
23
39
48
56
7.552
46
450
270
20
35
43
50
5.550
-11
477
286
21
37
45
52
5.200
6
580
348
26
45
55
64
7.379
22
717
430
32
55
68
79
7.899
24
Stock
Tractors (up to 20 years)
units
76.900
Import*
Total
Tractors
Combine harvesters
Export*
Total
Tractors
Combine harvesters
Market volume**
Total
Agricultural tractors
Tillage equipment
Plating, fertilizer, pest control
Harvesting equipment
Hay and silage equipment
Tractors
Market growth
m
m
m
m
m
m
units
%
* from/to selected reporting countries

** Source: Directorate Agricultural Mechanisation/SAAMA/AGFACTS
Main origin countries of imports: USA, Germany, Italy, Brazil, France
German exports to South Africa (2012): 84 Million Euro

z
Some background facts

} South Africas agricultural machinery market is nearly completely dependent on imports, local
production is limited to a few companies which are often dealers for foreign brands at the same
time.
} Tractors comprise about 60% of the South African agricultural machinery market. On average,
South African tractors in use have a little more than 100 kW.
Current developments
} Typical of an import-dependent market, the currency value is decisive for the market
development. Following the recent devaluation of the South African Rand, manufacturers have
been forced to increase prices. At the end of 2012, the year-on-year price increase for a large
part of agricultural machinery was about 8%.
} 2011 and 2012 were very strong years for South Africas agricultural machinery market. In 2012
nearly 7.900 tractors were sold an all-time high. In 2011, imports rose by about 50%, in 2012
again by 9% - the market was booming.
Outlook
} According to the South African Agricultural Machinery Association, in 2013 the tractor market
which comprises about 60% of the total agricultural machinery market will decline 10-15%.
On the one hand, a cool-off after the exceptionally strong years 2011 and 2012 is likely anyway.
On the other hand, some summer cropping areas have suffered drought damage recently.
Experts assume crop production to be cut by about 5% which could affect ag machinery
investments in the end.

z
Production sites (selection)
Orbach Agri,
Nelsonia
Radium Engineering,
Babelegi
Falcon,
Kwazulu-Natal
Staalmeester,
Klerskdorp
Bell, Richards
Bay
Andrag
Agrico, Saron
Source: http://www.infoplease.com/atlas/country/southafrica.html
South Africa: Fairs and Exhibitions

z
NAMPO Harvest Days

} 13.-16.05.2014 Bothaville (annually)
} Organized by Grain SA
} www.nampo.co.za
Agri Mega Week

} 18.-21.09.2013 Bredasdorp (annually)
} Organized by Agri Mega Group PTY Ltd
} www.megaweek.agrimega.co.za
Agri Works Expo Eastern Cape

} 08.-10.03.2013 Jeffreys Bay (annually)
} Organized by Cadek Media
} www.agriworks.co.za
South Africa: Basic Country Figures

z
Demographics
} Total population:
50 m
41 inhabitants per sq. km.
} Population growth:
-0,05%
} Fertility rate:
79% black Africans, 9% white Africans,
9% Mulatto, 3% Asians
} Urban population:
62%
} Below 15 years:
29%
Languages
Afrikaans, English, Ndebele, Northern
Sotho, Sotho, Swazi, Tswana, Tsonga,
Venda, Xhosa and Zulu
Fanagalo, Khoe, Lobedu, Nama,
Northern Ndebele, Phuthi, San
Religion
}
Major religion:
Christian
Minority religions:
Hindu and Muslim
Currency
} Name of currency
Rand (ZAR)
} Exchange rate:
1 EUR = 11,85 ZAR (04/2013)

z
Politics and state

} Capital:
Pretoria
} Administration:
9 provinces
Jacob Zuma
} Minister of Agriculture:
Tina Joemat-Pettersson
Economy
} Industries:
automotive, textile, armaments, chemical
and food industry
} Resources:
gold, coal, platinum, iron ore, diamonds,
chrome, manganese, limestone,
asbestos, natural gas, uranium, copper,
lead, zinc, crude oil

Economic indicators
2009
2010
2011
2012e
2013e
in billion USD
in USD per capita
%-change (real)
agriculture in %
in % of GDP
National debt
in %
Inflation
total (in m)
Employees
in agriculture (in %)
Av. monthly salary in USD
in %
Unemployment
284
5.746
-1,5
3
364
7.271
2,9
408
8.079
3,1
2,4
35
5
18
9
2.770
24,9
391
7.636
2,6
402
7.762
3
37
5,6
40
5,2
GDP
7,1
4,3
24
24,9
24,4
South Africa: Contacts

z
South African Agricultural Machinery

Association (SAAMA)
} P.O. Box 1159, Edenvale, 1610
} +27 11 453 72 49
} agfacts@worldonline.co.za
} www.saama.co.za

Johannesburg
} +27 11 48 62 775

Embassy
} Pretoria 0001
} +27 (0) 12 / 4 27 - 89 29

VDMA Report Analyzes Agricultural Machinery Markets and Climate Challenges in Algeria

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VDMA Report Analyzes Agricultural Machinery Markets and Climate Challenges in Algeria

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VDMA Agricultural Machinery Association

Ear to the Market: Africa

Ear to the Market: Africa 2013/2014

Contact: janine.heimann@vdma.org Page 1

VDMA Agricultural Machinery Association

Algeria July 2014

Egypt June 2014

Zambia May 2014

Kenya April 2014

Nigeria March 2014

Angola February 2014

Tanzania January 2014

Ethiopia December 2013

Ghana November 2013

Zimbabwe October 2013

Mozambique September 2013

South Africa August 2013

Ear to the Market: Africa 2013/2014

Contact: janine.heimann@vdma.org Page 2

VDMA Agricultural Machinery Association

Algeria July 2014

Ear to the Market: Africa 2013/2014

Contact: janine.heimann@vdma.org Page 3

VDMA Agricultural Machinery Association

Said Mahnane on his farm

Ear to the Market: Africa 2013/2014

For Ahmed Boughendouze, the manager of a 1,700 ha farm producing

VDMA Agricultural Machinery Association

According to ICARDA (International Center for Agricultural Research in

Up to 60% subsidies for agricultural machinery investments

Ahmed Boughendouze and his farm lands

Ear to the Market: Africa 2013/2014

Contact: janine.heimann@vdma.org Page 5

VDMA Agricultural Machinery Association

However, especially in comparison to the rest of Africa, there is actually

3,000 new tractors per year

Mr. Haroune from Al Tractors

Ear to the Market: Africa 2013/2014

Contact: janine.heimann@vdma.org Page 6

VDMA Agricultural Machinery Association

Ahmed Bougendouzes ag machinery park

Maintenance and technical assistance remain a major problem

Ear to the Market: Africa 2013/2014

Contact: janine.heimann@vdma.org Page 7

VDMA Agricultural Machinery Association

Said Mahnanes ag machinery park

Ear to the Market: Africa 2013/2014

Contact: janine.heimann@vdma.org Page 8

VDMA Agricultural Machinery Association

Ear to the Market: Africa 2013/2014

3,3 4,2 million t

Total country area:

2,1 2,4 million t

Contact: janine.heimann@vdma.org Page 9

VDMA Agricultural Machinery Association

Algeria: Agricultural Machinery

Ag machinery import 2012

Source: Federal Statistical Office Germany

Import 2013 (preliminary):

Main origin countries of ag machinery imports

Ear to the Market: Africa 2013/2014

Contact: janine.heimann@vdma.org Page 10

VDMA Agricultural Machinery Association