COTE D’IVOIRE

RUBBER ASSOCIATION APROCANCI GETS NEW LEADER

Full Story On Page 26

AFRICACOM-WATCH

CMA CGM/DELMAS Targets British-West African Bananas

ISSUE 52 | SEPTEMBER 2015

Ghana: COCOBOD Threatens To Withdraw Beans

Angola, Namibia And Zambia To Take Action On Illegal Timber

03 13 32

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AFRICACOM-WATCH

ISSUE 52 | SEPTEMBER 2015

Contents

03 | African Group News

04 | General

09 | Cocoa

05 | Cashew, Groundnut & Shea

15 | Coffee

Ghana: Exim Bank To Promote Commodities / 3rd Africa Palm Oil, Rubber & Cocoa SummitTanzania: Farmers To Own New Commodity Exchange Market

Benin: Borderless Alliance Shea Capacity Building WorkshopCote d’Ivoire: 2015 Cashew Output Hits Record 625,000 TonnesGhana: Groundnuts Have Huge Export Potential / Farmers Reject Proposed Ban On Cashew ExportNigeria: Cashew Nut Export Contributions Double / Additional US$75 Million Revenue Projected From Cashew ProcessingSenegal: Records Sharp Increase In Groundnut Production

General: Cargill Completes ADM AcquisitionCameroon: Ivorian Group Atlantique To Build A Processing Factory / Exports Increase In 2014-15 Season / CICC Announces 2015 FESTICACAO / Cocoa Season Launched, Certified Cocoa Production UpCote d’Ivoire: Cote d’Ivoire To Resell 200,000T Of 2015-16 Cocoa To International Buyers / Major Buyers Boycott Local Exporters Scheme / Arrivals Reach 1,682,000T By August 16 / Patchy Rain Promising For Main CropGhana: COCOBOD Threatens To Withdraw Beans To Processing Companies / Ghana Likely To Miss 750,000T Purchase Target / Dubai Embracing Ghana’s Cocoa Sector

Ethiopia: Low Coffee Export Performance In GTP I / Tepi Coffee Plantation PrivatizedGhana: Annual Coffee Export Records DeficitTanzania: TCB Targets 60,000 Tonnes Output / Coffee Conference In The OffingUganda: Uganda Returning To Former Glory As Top African Coffee Exporter / Processing Facility To Be Built In Nakaseke

19 | Cotton, Textiles & Leather GoodsTanzania: Bad Weather Hurts Cotton Growers

20 | FishAngola: Luanda Fishing Port Inaugurates New Cold StoreMozambique: China And Japan Promote Tuna FishingNamibia: New Horse Mackerel Factory For Walvis BayZambia: Zambia To Develop Aqua Parks

08 | CassavaGhana: Ghana To Host International Conference On CassavaLiberia: President Dedicates Cassava Processing Center

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THE AFRICAN COMMODITY REPORTBrought to you by CMA CGM / DELMAS Marketing

Rachel Bennett Dominic Rawle

25 | Palm OilCote d’Ivoire: DekelOil To Supply World Bank PSAC Palm Oil ProjectCongo: Eco-Oil Energy To Invest 350 Billion CFAF In Agri-Food ProjectGabon: Gabon Opens New Palm Oil PlantLiberia: Palm Product Export Facility To Be Built At Buchanan

27 | SugarEthiopia: Sugar Industries Expansion Gear Towards TransformationKenya: Kenya Inviting Bidders For Sugar CompaniesMozambique: Mozambique Raising Import Prices / European Union To Fund Sugar ProductionSenegal: Government Lifts Bans On Imports Of Sugar & PotatoesSwaziland: Swaziland Impacted By Drop In EU Sugar PricesZimbabwe: Raw Sugar Prices To Remain Stagnant

30 | TeaEthiopia: MoA To Establish Tea/Coffee AuthorityKenya: Strong Demand Fails To Lift Tea Prices At Mombasa Auction / Tea Industry Facing Shake-Up As Farmers Call For Overhaul Of Laws / Limuru Tea H1 Profit Falls

32 | TimberSouthern Africa: Angola, Namibia And Zambia To Take Action On Illegal Timber TradeWest/Central Africa: Slow Demand From China Dominates Market Sentiment / European Demand In Good Shape Say Producers / Sawnwood Prices Stable / Log Prices Held Up Only By Reduced Availability / US Tropical Sawnwood Imports Down From AfricaGabon: Producers Hard Hit By Weak Market For OkoumeGhana: Exports Register Healthy IncreaseSenegal: Senegal Announces Nationwide Logging Ban

21 | Foodstuffs & BeveragesGuinea Bissau: Indian Group Funds Agricultural DevelopmentMozambique: Mozambique Plans To Increase Import Costs Of Agricultural ProductsNigeria: Senate Urges Government To Stop Import Waivers On RiceSouth Africa: Macadamia Industry Solid / Western Cape Looking To Increase Halal Exports / EU Lifts Ban On Fresh Ostrich Meat Exports / Debate On Lifting US Meat Import BanUganda: RCL Foods To Buy 33.5% Share In Poultry Producer

35 | TobaccoZimbabwe: US$577 Million Tobacco Sold / Zimbabwe Mulls Use Of Ethanol To Cure Tobacco

26 | RubberCote d’Ivoire: APROCANCI Gets New LeaderNigeria: Rubber Estates Takes Over Orhionigbe Rubber Plantation

CMA CGM/DELMAS Targets British-West African Banana MarketCMA CGM/DELMAS will now call at Tilbury, UK as part of a service realignment between West Africa and Northern Europe. The EURAF 1 service will now make weekly calls at the London Container Terminal [LCT] providing competitive transit times for the export of banana reefer containers. The move will be enhanced later this year with the completion of a US$31.2 million state-of-the-art temperature controlled refrigeration distribution center. The project will see the building of one of Europe’s largest chilled warehousing facilities at the container terminal in close proximity to London. This will place Tilbury as an ideal port for UK exporters and importers looking to access West Africa.

http://www.delmas.com/products-services/line-services/flyer/EURAF1

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COMMODITY NEWSCORPORATE

GhanaExim Bank To Promote CommoditiesResponding to challenges faced by exporters in accessing long-term credit a draft bill for the establishment of the Ghana Exim Bank has been prepared for consideration by Cabinet. It is expected to begin operations in 2016. The Bank will serve as a vehicle for the consolidation of the current export finance activities of the export trade, Agricultural and Industrial Development Fund [EDAIF], Exim Guaranty Company and the Export Finance Company.

The government has identified 11-priority products for development to stimulate growth of Non-Traditional Exports [NTEs], in line with the National Export Development Strategy [NES]. The Ministry of Trade and Industry is collaborating with the Ghana Export Promotion Authority [GEPA] to implement an Export Development Programme to rekindle interest in the export chain. Vegetables, sugar loaf, cayenne and pineapple are some of the products to be supported to yield critical production mass for export - particularly to Asia.

GEPA’s goal is to increase the export of NTEs to US$5 billion by the end of 2019. In 2014 total NTE earnings hit US$2.514 billion an increase of 3.2% in value over 2013 which stood at US$2.436 billion.

[Government 29/07/15]

3rd Africa Palm Oil, Rubber & Cocoa SummitFrom 13-15 October, 2015, the 3rd Africa Palm Oil, Rubber & Cocoa Summit in Accra will host a delegation of plantation owners, agri-traders, investors and government officials coming together to tap the vast commercial opportunities in Africa’s 3-major cash crops: palm oil, rubber and cocoa. The Minister of Agricultural is to unveil Ghana’s agriculture Masterplan at the event.

[Star Africa 18/08/15]

TanzaniaFarmers To Own New Commodity Exchange MarketLocal private sector institutions including cooperatives and farmers’ organizations will hold a 51% stake in the Tanzania Mercantile Exchange Public Limited Company established as a vehicle for the new Commodity Exchange Market set to commence this year. The government will hold the remaining 49%. It is expected that the commodity exchange market will help farmers overcome challenges of the lack of a reliable market and introduce a more orderly and transparent trading.

The exchange will start with carefully selected commodities, cashew nuts, sesame, sunflower and rice ,which are now operational under warehouse receipt system. Other products will be added as the exchange gains confidence.

[Daily News 31/07/15]

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COMMODITY NEWSGENERAL

BeninBorderless Alliance Shea Capacity Building Workshop Borderless Alliance, in collaboration with the Global Shea Alliance [GSA], and the African Cashew Alliance [ACA] organized a 1-day training workshop for stakeholders within the shea and cashew value chains in Benin. The event was organized under the auspices of the USAID and was aimed at strengthening the capacity of actors in the value-chain such as transporters, truck drivers, customs and border control officials, port officials and entire membership of the 3-collaborating alliances.

Transporters decried the lack of technical support from government and the failure of the Banks in Benin to provide credit facilities to renew their trucking fleet. Members of the Cashew Exporters Association, [CoNEC] appealed to the government to make available storage infrastructure at the Port of Cotonou for shea and cashew nuts due for export.

Producers made a case for the need for technical assistance in the areas of market linkages and the local production jute sacks. Some recommendations that emerged from the workshop include the need for the removal of non-tariff barriers, the removal of unauthorized checkpoints on the access roads linking the production areas, rehabilitation of bridges and widening the network of access roads, provision of daily market price information through mobile phones and establishment of national regulatory coordinating ombudsman. The workshop was preceded by a field trip to the major shea and cashew production zones in Benin.

[Borderless Alliance 07/08/15]

Cote d’Ivoire2015 Cashew Output Hits Record 625,000 TonnesCote d’Ivoire’s 2015 cashew nut crop jumped by 11% to a record 625,000 tonnes compared with the previous year. In addition to being the world’s top cocoa producer, Corte d’Ivoire is also Africa’s biggest cashew grower. Nut exports reached 337 billion CFA francs [US$571 million] in 2015 boosted by government reforms and investments in the sector. A decade ago, Ivory Coast produced around 80,000 tonnes of raw nuts per year. With output growing by over 10% annually amid strong demand from Asian countries, the cashew sector attracted the attention of a government keen to kick-start the economy.

[Reuters 27/07/15]

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COMMODITY NEWSCASHEW, GROUNDNUT & SHEA

GhanaGroundnuts Have Huge Export PotentialGroundnut has been identified as one of the major cash crops with huge export potentials for Ghana according to the Ghana Export Promotion Authority [GEPA]. A 3-month training programme for export-oriented chain operators, including local producers, processors, traders and exporters was held in Navrongo in the Upper East Region. The objective is to reduce the level of aflatoxin contamination in groundnut, peanut butter and cereal products to meet EU technical regulations and standards so as to enhance export quality control, management and certification to the international market. The program is supported by the European Union, through the Trade Related Assistance and Quality Enabling [TRAQUE] Programme, and will target farmers from Brong Ahafo, Northern, Upper West and Upper East Regions.

Ghana with its favourable climatic conditions and abundant rich soil has a comparative and competitive advantage in groundnuts and cereal exports is well positioned to take advantage of the international market opportunities to develop the sector. As part of the GEPA National Export Strategy, targeted to achieve US$5 billion from the non-traditional exports sector by 2019, groundnuts will be a critical contributor.

[Ghanaweb 30/07/15]

Farmers Reject Proposed Ban On Cashew ExportCashew farmers have kicked against a proposed ban on the export of raw cashew nuts [RCN] by players in the cashew processing industry. Cashew processors in recent times have advocated an outright ban on the export of RCN as one of the “necessary interventions” needed to salvage the processing companies collapsing in the country as a result of the commodity’s non-availability at a competitive price. Of the 12 processing companies all have shut down except for Mim Cashew and Agricultural Products Ltd. Farmers say any attempt to forbid exports of RCN will give processors a monopoly.

Ghana has the potential to become a net exporter following a vigorous cultivation drive as seen in neighbouring Cote d’Ivoire. Cote d’Ivoire produces 500,000 MT per annum and processes around 150,000 MT. Ghana on the other hand produces about 65,000 MT with total installed processing capacity of 70,000 MT. Meanwhile, a 35,000 MT Usibra Ghana Ltd. at Pramparm is yet to commence operation to scale-up the country’s processing capacity to 105,000 MT in the view of the RCN supply shortfall.

The price of RCN is GH¢4/kg representing a significant increase of 166% from GH¢1.5 in 2013. [Ghanaweb 05/08/15]

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NigeriaCashew Nut Export Contributions DoubleThe National Cashew Association of Nigeria [NCAN] noted cashew export from the 2014-15 season [140 MT] contributed N50 billion to the economy up from N24 billion in the 2013-14 season. The growth was down to an improvement in the quality of cashew nuts resulting in increased demand for the produce. Also the price of raw cashew nut per metric ton recorded an increase, selling at N170,000 during the 2015 season. Expectations for the next season will be even higher with preparations underway including tree pruning and training for an increased annual production of 30-40% across the 27 cashew producing states.

[NAN 13/08/15]

Additional US$75 Million Revenue Projected From Cashew Processing African Cashew Alliance [ACA] says over 344,000 new jobs and an additional US$75 million in revenue could come from the Nigeria’s cashew processing industry, if properly harnessed. Only about 20% of the Raw Cashew Nuts [RCN] produced in the country are current processed into kernels.

[Daily Times 19/08/15]

SenegalRecords Sharp Increase In Groundnut ProductionSenegal has recorded a sharp increase in groundnut production of 67.9% during the first 5-months of 2015 compared to the corresponding period of 2014. According to the Directorate of Forecast and Economic [DPEE] output rose from 18,700 tons in the first 5-months of 2014 up to 31,400 tons of 2015 for the same period. The increase is due to oilcakes and raw oil. Oilcake production rose 70.9% reaching 16,200 tons, against 9,500 tons in 2014. Raw oil grew 49.4% reaching 12,600 tons against 8,400 tons in 2014. The production of refined groundnut vegetable was 2,700 tons in 2015 compared to 800 tons in 2014.

[APA 28/07/15]

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COMMODITY NEWSCASHEW, GROUNDNUT & SHEA

GhanaGhana To Host International Conference On CassavaAn International Conference and Exhibition on Cassava Utilisation and Marketing is to take place from September 13-18, in Accra. The conference will provide the platform for countries and investors to connect, share best practice and promote investment. It will provide a stage for researchers, policy makers, financiers and industrialists to meet and discuss utilization, marketing and other emerging issues in the cassava value chain.

[GNA 11/08/15]

LiberiaPresident Dedicates Cassava Processing CenterPresident Johnson-Sirleaf attended the turning over ceremony of the Cassava Processing Center in Kormah Town, Bomi County. The facility was built by Urban and Peri-Urban Agriculture, Nutrition and Income [UPANI] and implemented by Welthungerhilfe [WHH] in Partnership with ACF and RUAF and funded by the European Union.

[Inquirer 11/08/15]

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COMMODITY NEWSCASSAVA

GeneralCargill Completes ADM AcquisitionCargill has completed the acquisition of ADM’s global chocolate business for US$440 million. The combined business provides Cargill with enhanced capabilities and product ranges to deliver a broad portfolio of products that support the long-term needs of existing and new customers. Cargill’s cocoa and chocolate business now operates globally with 27 sites in 11 countries. Addressing the European Commission’s conditional clearance, Cargill agreed to divest ADM’s industrial chocolate production facility in Mannheim, Germany. The facility is kept as a separate entity with its own interim management until transferred to a prospective buyer.

[PRNewswire 30/08/15]

CameroonIvorian Group Atlantique To Build A Processing Factory Ivorian company Atlantique [Atlantic Télécom, Atlantic Financial Group] is pushing forward its agro-industrial project. Formed in 3-parts, then scheme includes the creation of cocoa farms, the construction of a cocoa processing plant and the setting up of a producers’ association. The project has been so well received by the Cameroonian authorities that it falls in with plans to revive the cocoa-coffee sector, adopted by the Cameroonian government in September 2014. Implemented at the start of 2015, the plan aims to produce 600,000 MT nationally by 2020 against the current annual average of 200,000 MT. In addition, Cameroon wants to shed its reputation for being a top exporter of unprocessed cocoa, by encouraging investment in the area of transformation. On average, it is forecast to locally process 70% of national production against only 25% currently.

[Business in Cameroon 07/08/15]

Exports Increase In 2014/15 SeasonCameroon’s 2014/15 cocoa production increased to 232,530 MT compared with 209,905 tonnes the previous season according to National Cocoa and Coffee Board [NCCB] data. Cocoa bean exports from the world’s 6th biggest grower rose to 198,129 MT by the end of the season on July 15, an increase of 23,500 MT [12%] from 2013/14 levels. The Netherlands was the top destination for exports [73%] followed by Belgium [8%] and Indonesia at nearly 8%. The leading exporting companies were Telcar Cocoa Ltd with 58,486 MT, Olam International’s local unit Olam Cam at 30,294 MT, Cameroon Marketing Commodities with 25,757 MT and Ets Ndongo Essomba at 17,722 MT.

Cameroon processed 32,143 MT domestically during the 2014/15 season. Industrial grinders Sic-Cacaos, a subsidiary of Swiss chocolate manufacturing firm Barry Callebaut, and CHOCOCAM, an affiliate of South Africa’s Tiger Brands accounted for 32,112 MT. The remaining 31 tonnes were processed by artisanal units. That compares with a total of 32,804 MT processed in 2013/14. In March, Cameroon announced plans to double its cocoa processing capacity to about 30% of its total production, or nearly 70,000 MT of beans per year, by adding 10 new processing units. The nation’s cocoa season runs from August to July. The main harvest is from October to January/February, followed by a light crop harvest period from April/May to June/July.

[Reuters 06/08/15]

CICC Announces 2015 FESTICACAO The Interprofessional Cocoa and Coffee Board (CICC) has announced that the 2015 International Cameroonian Cocoa Festival (FESTICACAO) will be held from December 3-5, 2015. FESTICACAO 2015 will be based on the general theme of “Women in Cocoa” and will provide the opportunity to promote local processing as well as the consumption of cocoa bi-products.

[Business in Cameroon 19/08/15]

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COMMODITY NEWSCOCOA

Cocoa Season Launched / Certified Cocoa Production UpOn 7th August 2015 Ayos hosted a ceremony to launch the 2015-2016 cocoa season. The National Cocoa and Coffee Board [ONCC] revealed that producers brought 10,000T of certified cocoa to market in 2014-2015. This production practically doubles that of the previous season, which reached 5,446T, against around only 2,000T in 2012-2013. Thus in the last 3-cocoa seasons, Cameroonian farmers have increased certified cocoa production fivefold. Among them is Telcar Cocoa, the local representative of Cargill, which has remained the leader on the certified cocoa market in Cameroon alongside Sic Cacacaos, a subsidiary of Barry Callebault, and AMS, a subsidiary of the Dutch company, Theobroma.

[Business In Cameroon 13/08/15]

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Cote d’IvoireCote d’Ivoire To Resell 200,000T Of 2015-16 Cocoa To International BuyersThe Ivorian cocoa marketing board is to begin auctions to resell at a discount to international buyers around 200,000T of 2015/16 beans purchased by domestic operators. During forward sales of the 2015/16 harvest, major cocoa buyers boycotted a scheme introduced this season that gave local export companies a monopoly on international supply contracts, arguing that they lacked the necessary capacity and financing. Local exporters have already purchased cocoa at local auction, anticipating there would be buyers for the international contracts. The 200,000T is part of 1.3 million tonnes from the 2015/16 harvest already sold forward at prices that should allow Ivory Coast to set a farmer price of 1,000 CFA francs/kg [US$1.70] next season.

The Coffee and Cocoa Council [CCC] announced in a memorandum what it called a “compensatory session”, stating that the move aimed to “re-establish balance in the allotment of volumes between local and international operators”. The CCC uses an electronic auction system that allows international firms not present in the country to purchase Ivorian cocoa. Under the scheme introduced this season, the marketing board then chooses local exporters, who receive tax breaks and other incentives and are charged with ensuring delivery. The auction would primarily interest international grinders who require a steady supply of beans for their processing factories. Ivory Coast is on track to produce around 1.7 million tonnes of cocoa this season.

[Reuters 12/08/15]

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COMMODITY NEWSCOCOA

Major Buyers Boycott Local Exporters SchemeMajor cocoa buyers are boycotting a scheme in Cote d’Ivoire aimed at guaranteeing local firms a share of the lucrative export market, arguing that these players lack the expertise and financing to ensure reliable deliveries. A 2011 reform of the cocoa sector specified that a significant share of the annual crop should be allocated to local companies for export, in a bid to develop the domestic industry.

This season, the Coffee and Cocoa Council [CCC] regulator awarded contracts to local exporters for the delivery of 150,000 MT of cocoa, from an estimated total crop of 1.7 million MT. The CCC uses a messaging system to pair up international firms seeking cocoa with local exporters who handle the shipment. Major international firms present in Ivory Coast include Cargill, Singapore’s Olam, Sucden and Barry Callebaut. The boycott could leave the CCC holding several thousand of tonnes of unsold cocoa beans at the start of the 2015/2016 cocoa season.

Meanwhile, a group of 6-local exporters is lobbying the government to increase the total amount of beans allocated to them for export to 200,000 MT. The CCC already provides local exporters with tax breaks and other incentives to increase capacity and boost their expertise.

Ecobank noted the initiative could expose the CCC to legal risks if shipment quality was sacrificed and that it was an ineffective use of subsidies. Many cocoa purchasers were not interested in the contracts due to counterparty risks, with traders complaining that the contracts were not awarded on the basis of logistical or financing competence.

[Reuters 30/07/15]

Arrivals Reach 1,682,000T By August 16Cocoa arrivals at Ivorian ports reached 1,682,000T by August 16 since the start of the season on October 1 up from 1,663,000T in the same period of the previous season. Exporters noted 12,000T of beans were delivered to Abidjan and San Pedro between August 10-16, down from 18,000T during the same period last year.

[Business Recorder 17/08/15]

Patchy Rain Promising For Main CropPatchy rain in most of the main cocoa regions bodes well for the development of the main crop although there were some concern over a lack of rainfall elsewhere. The world’s largest cocoa producer is now harvesting its mid-crop. Weather trends in the next few weeks will be critical in determining the size of the larger October-March main crop.Rain showers mixed with sunshine were reported in the coastal region of San Pedro, the western region of Duekoue and in southern regions of Aboisso and Agboville. There are lots of flowers that have transformed into small pods. If conditions continue the first harvest will be at the end of September and there will sufficient harvests in October.

[Reuters 03/08/15]

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GhanaCOCOBOD Threatens To Withdraw Beans To Processing Companies The Ghana Cocoa Board [COCOBOD] is threatening to cut bean supplies to some cocoa processing companies. The board has alleged that 5-companies owe the board US$225 million in arrears for beans supplied to them for processing over the years. Details are being withheld for business reasons. The processing sub-sector is dominated by multinationals, who process beans for export to their foreign partners. They control 60% of the sector leaving the remaining to local processors. However the interests of local investors has been growing, mainly as a result of new policy incentives from COCOBOD, which include giving priority to indigenous processors in the supply of beans. Those policies have, however, come with their own challenges, including the inability to make prompt payments for supplies. Currently, about 80% of annual output is exported, leaving the remainder for the processing companies. As of December 2014, the installed capacity of processing companies was 450,000 MT per annum.

[Graphic 28/07/15]

Ghana Likely To Miss 750,000T Purchase TargetGhana’s cocoa purchases for 2014/15 crop year are below 700,000T and are unlikely to meet the government’s revised full season target of 750,000T given that the period ends in mid-September. Industry regulator Cocobod said at the start of the season last October that Ghana would produce more than 1 million tonnes but revised the target given problems with weather and crop disease. Cocobod has extended this year’s main crop-buying period in frantic efforts to boost output, which is currently down 23% on the 2013/14 season when it produced 900,000T. An average of 5,000T a week is expected until the end of the season. The regulator asked buyers to begin preparations for the closure of the crop year in mid-September, to be followed by an early opening of the 2015/16 main crop, which normally begins in early October.

[Reuters 18/08/15]

Dubai Embracing Ghana’s Cocoa SectorThe Dubai Chamber of Commerce and Industry has expressed its readiness to play a pivotal role in Ghana’s cocoa sector, using its comparative advantage as a trade hub for Asia and beyond. To assess the potential for opportunities between cocoa government agencies and relevant private enterprises, Dubai Chamber held its first Cocoa Roundtable Discussion in Accra in August 2015.

[Ghanaweb 13/08/15]

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COMMODITY NEWSCOCOA

Daily Spot Price [ICCO]These are the average of the quotations of the nearest three active futures trading months on NYSE Liffe Futures and Options and ICE Futures US at the time of London close.

Date ICCO daily price (SDRs/tonne)

ICCO daily price (US$/tonne)

London futures (£ sterling/tonne)

New York futures (US$/tonne)

3 Aug 15 2321.37 3236.69 2116.67 3174.33

4 Aug 15 2316.31 3231.33 2108.00 3175.00

5 Aug 15 2288.91 3181.59 2075.67 3127.00

6 Aug 15 2241.73 3118.87 2044.33 3070.67

7 Aug 15 2279.56 3171.83 2086.67 3117.67

10 Aug 15 2271.77 3160.37 2071.33 3105.00

11 Aug 15 2254.18 3147.91 2058.67 3092.33

12 Aug 15 2210.62 3098.63 2024.33 3034.33

13 Aug 15 2225.10 3116.78 2035.00 3064.67

14 Aug 15 2218.52 3114.00 2031.67 3056.67

17 Aug 15 2223.50 3112.06 2032.00 3056.33

18 Aug 15 2239.42 3134.35 2040.00 3077.33

19 Aug 15 2262.12 3162.85 2061.00 3104.67

20 Aug 15 2265.98 3181.64 2067.00 3123.67

21 Aug 15 2221.36 3133.33 2035.00 3078.33

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EthiopiaLow Coffee Export Performance In GTP IThe Ethiopian Ministry of Trade reported coffee exports reached 939,325T from the total planned 1.4 million T in the 5-years of the first Growth and Transformation Plan [GTP I]. This generated a US$4 billion income lower than the expected US$5.2 billion. Coffee smuggling, domestic trading of export coffee, and the outmoded primary level market were listed as challenges in the performance of the plan.

In the first year of the GTP I, 2009/10, the plan was to export 302,264T of coffee which decreased to 288,857T in the following year. Planned exports continued to fall up to 2014/15. Among the 55 export destinations of the country’s coffee, Germany took the lead with 254,977T generating revenue of US$1 billion followed by Saudi Arabia at 146,308T generating US$595,131.

[Addis Fortune 10/08/15]

Tepi Coffee Plantation PrivatizedTepi Green Coffee State Share Company has been fully privatized by the Privatization and Public Enterprises Supervising Agency [PPESA] after signing an agreement with Green Coffee Agro Industry Private Limited Company. The government sold its 73.32% share to the company for 733.2 million Birr. The company owns an 8,100-ha plantation in Gambella Regional State.

[Ethiopian News Agency 15/08/15]

GhanaAnnual Coffee Export Records DeficitThe Cocoa Research Institute of Ghana [CRIG] noted huge annual deficits in the export of coffee in Ghana and is advising farmers to engage in production in commercial quantities. Coffee is in high demand on the international market as such the government is investing heavily in both human and financial resources in the industry. The board provides farm inputs and facilitates access to financial assistance to promote expansion with the sector growing significantly since CRIG implemented the Coffee Revamp Project in 2011. Under the 4-year project, funded by the government at a cost of US$1.1 million, more than 2,500 ha of coffee farms have been established. A bag of coffee currently sells at GHC200 [US$53].

[GNA 31/07/15]

15

COMMODITY NEWSCOFFEE

TanzaniaTCB Targets 60,000 Tonnes OutputDespite the fall of coffee prices in the world market, local farmers’ earnings are set to increase following Tanzania Coffee Board [TCB] interventions in cutting down costs. The move comes amid a bumper harvest this season seeing output jumping to 60,000 tonnes compared to 40,000 tonnes last year. It shows how much producers have actively invested in better crop management activities and technologies. Meanwhile after a meeting with stakeholders coffee duties and levies were slashed from 5% to 3% an initiative to cut down costs and boost farmers’ earnings.

World coffee prices have declined from US$5/kg to US$3/kg in recent months impacting heavily on earnings. This was largely due to weakening of the Brazilian currency against the US dollar, thus increasing coffee exports from Brazil, which is the world’s largest coffee producer. As part of the interventions the TCB has been advising coffee farmers when to sell their coffee in order to fetch premium prices.

Coffee production in the world’s biggest grower Brazil could fall to 44 million to 45.5 million 60-kg bags in 2015, in part due to the drop in robusta output. The statistics show that output is down from the estimate of 48 million to 49 million bags and below most estimates gathered so far by other trade houses that range from 45.3 million bags to 49.75 million bags for the upcoming 2015/16 crop.

[Daily News 29/07/15]

Coffee Conference In The OffingThe 14th African Fine Coffee Conference and Exhibition will be held from February 3-5, 2016 in Zanzibar. The exhibition, co-organised with the Tanzania Coffee Board (TCB) and the African Fine Coffees Association (AFCA), expects to attract more than 1,500 international participants. Stakeholders are expected to discuss developments of coffee industry and also share experiences. View http://www.eafca.org/index.asp for more details.

[Daily News 19/08/15]

16

UgandaUganda Returning To Former Glory As Top African Coffee ExporterFive years ago, Uganda dropped from the list of the world’s top-10 coffee producing countries. However, according to the International Coffee Organisation [ICO] statistics, the country bounced back in the 2014-2015 coffee year in the 7th position after exporting 2.24 million 60-kg bags and in the process upstaging Ethiopia to become Africa’s biggest coffee exporter. Uganda even stands a chance to be among the top-5 in the next few years when big projects aimed at increasing production start to pay off.

According to the Uganda Coffee Development Authority [UCDA], the future looks bright. Some 17 million new coffee trees were planted in 2013 and that figure could climb to 225 million coffee trees in 5-five years. USAID has introduced a 2-year project aimed at increasing productivity for 20,000 smallholder farmers in 22 coffee growing districts. In April Uganda got Shs1.3bn through the initiative channelled through the US governments` Feed the Future Initiative, and implemented by the National Union of Coffee Agribusiness and Farmer Enterprises [Nucafe]. While it is still early to determine the impact of the funding, coffee production is likely to rise amid declining global production and rising consumption levels globally. According to the June 2015 UCDA report, about 335,400 sixty-kg bags of coffee worth US$35.26 million were exported at an average price of US$1.75/kg some 26.75% and 7.43% higher in volume and value respectively compared to the same month in 2014. Despite recent droughts UCDA projections indicate that exports may rise to 5.87 million 60-kg bags by 2019-20. These projections are based on the massive coffee re-planting program that started after the coffee wilt disease and the coffee borer attacked coffee trees in Uganda. To supplement government efforts in coffee production, the sector industry players have taken the bull by the horns and are engaging contract growers. UGACOF still commands the highest market share with 16.3% [54,667 bags] but its export volumes also declined from the 18% of the previous month. UGACOF has launched a US$1 million coffee sustainability project over 3-years that covers several districts in Busoga and Central region covering more than 30,000 farmers. The project distributes planting materials, sensitizes farmers on formation of savings and loan associations to ease access to credit, post-harvest handling, good agricultural practices among others.

The government aims to boost coffee exports by mitigating the supply-side constraints by distributing free seedlings, and to re-establish extension staff and establish demonstration model farms and coffee cooperatives supporting value addition. This is backed by investments of indigenous companies that include Good African Coffee, Mount Elgon Coffee, and Star Café among others.

[Independent 17/08/15]

Processing Facility To Be Built In NakasekeWith the aid of a US$60,000 grant from government, farmers in the Nakaseke District of Central Uganda are to build a coffee processing and agricultural factory promoting value addition for both domestic and international markets. The Kikamulo Cooperative will oversee the development of the building which has 500 members and produces 1,000 tons of coffee per season. The Uganda Coffee Development Authority [UCDA] has sent 150,000 coffee seedlings to Nakaseke to support farmers there.

[Coffee Press 11/08/15]

17

COMMODITY NEWSCOFFEE

18

TanzaniaBad Weather Hurts Cotton GrowersCotton growers and buyers in the Bunda District stand to suffer substantial losses this year due to drought that has adversely impacted production. Although almost all cotton ginners are in crisis due to acute shortage of seed cotton, cotton buyers who snubbed the contract farming system are the hardest hit.

The collapse of contract farming has had a negative impact on cotton production in the district; cotton production peaked in the 2008/09 season with 14,311 metric tonnes thanks to contract farming, but production has since been dropping, with this year’s estimates put at 5,000 tonnes mainly due to unfavourable weather and failing contract farming.

The government through Tanzania Cotton Board [TCB] in 2007 embarked on pilot contract farming in Mara’s three districts of Serengeti, Bunda and Musoma Rural to help cotton growers to boost production through timely supply of inputs and guaranteed markets. However, the system collapsed despite its potential benefits to both farmers and ginners due to what stakeholders describe as vested interests.

[Daily News 20/08/15]

19

COMMODITY NEWSCOTTON, TEXTILES & LEATHER GOODS

AngolaLuanda Fishing Port Inaugurates New Cold StoreA cold store capable of holding 2,000 tons of fish was inaugurated Friday in the fishing port of Boavista in Luanda by the minister of Fisheries. The cold storage warehouse opened by Minister Victoria de Barros Neto is a public-private partnership, where state fishing company Pescangola has invested over US$1.32 million.

The minister stressed the government’s intention was to increase the availability of cold stores along the Angolan coast, but also to develop inland fishing and increase storage capacity in the interior of the country. The chairman of Pescangola, Pereira Mayamona, said the project would support fishing so when there is a drop in demand in the market, ships are not held at port waiting for customers. “We will support the life and work of fishermen by preserving the fish,” said Pereira Mayamona.

[Macauhub/AO 17/8/15]

MozambiqueChina And Japan Promote Tuna FishingChinese-owned Mozambican company Yinuo Pescas, Limitada, has commissioned a shipyard in China to build nine vessels for tuna fishing in the coastal region of the Angoche district of Nampula province. Meanwhile progress had been made in negotiations with the Japan Tuna Company, which formally expressed interest in fishing for tuna off the coast of Nacala-Porto, with a fleet of 15 vessels, or potentially more in the future.

[Macauhub 13/08/15]

NamibiaNew Horse Mackerel Factory For Walvis BayA ground-breaking ceremony has taken place of the N$250 million Atlantic Pacific Fishing factory in Walvis Bay. The factory will process and package horse mackerel for both local and export markets. Atlantic is a joint venture [JV] 51% owned by Namibian long-term horse mackerel rights holder, Hefty Group of companies [Pty] Ltd; Joka Two Fishery [Pty] Ltd and Namibia Seaweed Processing [Pty] Ltd. The remaining 49% is owned by Brandberg Namibia Investment Company [Pty] Ltd, which falls under China Fishery Group Ltd, a subsidiary of Pacific Andes International Holdings Ltd, based in Hong Kong. Construction will commence this year and is expected to be completed by the end of 2016.

[Namibian 11/08/15]

ZambiaZambia To Develop Aqua ParksZambian President Lungu noted the government has acquired US$50 million from the African Development Bank [AfDB] to develop aqua-culture parks to encourage fish farming in rural areas.

[ZNBC 05/08/15]

20

COMMODITY NEWSFISH

Guinea BissauIndian Group Funds Agricultural Development The Kirloskar Brothers Ltd group of India has committed to providing funding of US$10 million to increase agricultural production in Guinea-Bissau. The funding is intended to be channelled into rice production to ensure the population’s self-sufficiency, as well as into horticulture and fruit growing. Kirloskar promised that if this venture was successful, his group would provide another US$30 million to finance a second phase of this project.

[Macauhub 06/08/15]

MozambiqueMozambique Plans To Increase Import Costs Of Agricultural ProductsThe Mozambique government is considering the introduction of surcharges on imports of products such as rice, beans, meat and eggs in order to promote domestic production, sale and processing. The move follows the successful experience with regard to sugar imports, whose surcharge has just been increased. For sugar, the government announced that the import benchmark price per ton of raw sugar had been increased from US$385 to US$806 and refined sugar from US$450 to US$932.

The measure is intended to ensure fair competition with the Mozambican sugar industry and allow the replacement of imports with domestic production. Rice farmers in particular have been complaining about imports undermining production in Mozambique as there are no restrictions on product entry.

The Ministry of Agriculture and Food Security has identified 15 strategic products for development and investment in the farming sector: corn, rice, beans, cassava, potatoes, poultry, beef, vegetables, banana, sugar, wheat, sesame, soy, cashew nuts and cotton.

[Macauhub/MZ 18/08/15]

NigeriaSenate Urges Government To Stop Import Waivers On RiceTo boost the Nigerian economy the Senate has urged the Federal Government to stop all waivers on rice importation forthwith. Nigeria has lost N585billion from 2011-14 due to waivers granted on importation of rice and other agricultural products. In 2011 the Government granted import duty waivers to 10 rice and palm oil importing companies. The Senate have urged the government to set up an ad-hoc committee to look into the policy on import waivers and to carry out a holistic review.

[Daily Times 31/07/15]

21

COMMODITY NEWSFOODSTUFFS & BEVERAGES

South AfricaMacadamia Industry SolidThe Southern African Macadamia Growers’ Association [SAMAC] expects the industry’s current growth trend to continue for at least the next 5-7 years. South Africa has around 19 000 ha of macadamias, with an additional 1,000 ha being planted every year. This prediction stands in contrast to recent statements by the Green Farms Nut Company, a SAMAC member, which noted the industry faced an uphill struggle as China the main buyer is becoming stricter on quality. The industry has also seen traders and middlemen guilty of avoiding duties and China’s strict country of origin regulations by either disguising the true value of imports or using ports of entry in countries such as Vietnam and Hong Kong, where duties were lower or did not apply.

However record prices are being paid for the nuts and supply is actually running short. Around 40-50% of South Africa’s macadamia crop is sold as in-shell, particularly to China, with the remainder processed to kernel. South Africa is currently leading the global production of macadamias, along with Australia, with an estimated crop of 46 950 T inshell for the 2015/16 season.

[Engineering News 29/07/15]

22

Western Cape Looking To Increase Halal ExportsThe Western Cape government is seeking to increase the value of Halal exports by US$31-billion by 2020, through a proposed R1-billion Halal agro processing food park that will allow it to double its share of the fast-growing market. If approved the park could be launched within 2-years. Two sites are under consideration - the Cape Town International Airport and a site in the Cape Winelands. The Western Cape government is working towards the development of the park in partnership with the Western Cape Fine Foods Initiative and the private sector, with prefeasibility studies suggesting that the park could generate up to R5-billion for the local economy each year. A prefeasibility study has been completed. Earlier this year, a delegation visited Malaysia, to strengthen trade links between. The Western Cape Fine Food Initiative and the Malaysian Industry Government Group for High Technology have already signed a cooperation agreement to foster partnerships between the Halal industries. The global Halal market is worth US$2.3-trillion.

[Engineering News 28/07/15]

EU Lifts Ban On Fresh Ostrich Meat ExportsThe European Commission has lifted the four-year ban on the export of South African fresh ostrich meat into the European Union [EU]. Exports to the EU will resume late August and would continue in parallel with the export of processed ostrich meat. The ban was implemented in April 2011, following the outbreak of avian influenza, and has been lifted now that the commission had been assured that South Africa was free from the disease.

[Engineering News 07/08/15]

Debate On Lifting US Meat Import Ban US officials have demanded further evidence that South Africa is ready to lift disease-related bans on US poultry, beef and pork. This was raised at a public hearing in the US on whether South Africa should continue to receive African Growth and Opportunity Act [AGOA] trade privileges. To remain part of AGOA, the country would have to do more than just “address US concerns”.

Citing outbreaks of avian flu in 20 US states, SA prohibits imports of all US chicken, including the 65,000 tonnes of frozen bone-in portions it recently agreed to let in annually at normal tariff rates. The US is demanding that the ban be “regionalised” - limited to poultry from areas in which outbreaks have occurred. South Africa is willing to consider “regionalisation” if there are no further cases of avian flu over the next 6-weeks.

[Business Day 11/08/15]

23

COMMODITY NEWSFOODSTUFFS & BEVERAGES

UgandaRCL Foods To Buy 33.5% Share In Poultry Producer South African RCL Foods, through a 33.5% shareholding in Hudani Manji Holdings [HMH], intends to enter the East African region to create one of the largest processors and marketers of chicken in both Uganda and East Africa. The deal is worth US$4.66-million. RCL is the owner of South African chicken processor and marketer Rainbow, which has 209 rearing, laying and broiler farms and hatcheries, boasting 30-million birds on the ground. The business has 6-processing plants, which produced 392 000 t/y of chicken.

[Engineering News 31/07/15]

24

Cote d’IvoireDekelOil To Supply World Bank PSAC Palm Oil ProjectDekelOil PLC has been accepted as an approved supplier to the World Bank-backed Projet d’Appui au Secteur de l’Agriculture de Côte d’Ivoire project [PSAC] to support and improve the palm oil industry.

PSAC aims to plant 10,000-ha of palm oil and plans to establish a pilot zone in DekelOil’s operating region in 2015 to improve the quality of the roads and provide 5,000-ha of land suitable for palm oil for smallholder operations.

Under the agreement, PSAC will subsidise half of DekelOil’s costs associated with preparing nursery plants for sale to smallholders. DekelOil said it will allocate 140,000 plants grown at its nursery in Ayenouan in 2015 and 420,000 plants in 2016, and anticipates that the smallholders will become new trading partners as they come into crop production in 3-years’ time. DekelOil is the first to sign up to this programme.

[Alliance News 18/08/15]

CongoEco-Oil Energy To Invest 350 Billion CFAF In Agri-Food Project Malaysian investors are to invest CFA Francs 350 billion in an agro-industrial project in the Congo. Eco-Oil Energy Group is the leading company on this project with some CFAF 50 billion already invested in the production of palm oil and margarine. The company wants to see its 50,000-ha operation in Owando and Makoua regions increased to 300,000-ha. The Group intends to export any surplus production to the sub region.

[Ecofin 18/08/15]

GabonGabon Opens New Palm Oil PlantPresident Bongo inaugurated a new palm oil production facility in Kango, south of Libreville. It is the second such plant after that managed by SIAT Gabon in Lambaréné. The plant was built by the Singapore-owned agro-industrial group Olam, as part of a Public-Private Partnership [PPP] with the Gabonese government. Gabon plans to increase its oil production to 250,000T by 2020 and thus become the largest producer in Africa, south of the Sahara.

[APA 14/08/15]

LiberiaPalm Product Export Facility To Be Built At BuchananEquatorial Palm Oil PLC has signed an agreement with the National Port Authority of Liberia via its operating subsidiary, LIBINC Oil Palm Inc, to lease land so it can build a 10,000 MT palm product export facility at Buchanan port 24 km away from its Palm Bay estate. The 4.5 acre site is in close proximity to the wharf where vessels will load the produce for export. Discussions were held with authorities for over 2-years to secure the deal, which is for a 25 year term with the option to extend it by a further 13 years.

[Alliance News 10/08/15]

25

COMMODITY NEWSPALM OIL

Cote d’IvoireAPROCANCI Gets New Leader Some 600 producers from 18 regions took part in an extraordinary meeting of the Association of Producers of Natural Rubber in Côte d’Ivoire [APROCANCI - l’Association des producteurs de caoutchouc naturel de Côte d’Ivoire]. The result was the annulment of Wadjas Aswan as Board President for financial malpractice with Engin Yao announced as his replacement. The move hopes to give new “breath” to APROCANCI, weighed down for several months by a crisis of confidence.

[Star Africa 12/08/15]

NigeriaRubber Estates Takes Over Orhionigbe Rubber Plantation The Edo state government has leased the state owned Orhionigbe Rubber Estate at Orhionmwon to the Rubber Estate of Nigeria [formerly Michelin] to manage and develop. The lease falls under the state government Public Private Partnership Initiative [PPPI] policy to develop the rubber sub-sector. Rubber Estate has indicated interest to invest about N1billion in the development of the 4,000-ha estate within the next 3-years as well as establish a processing factory to boost production. Rubber Estate has applied for another 20,000-ha out of the state’s 150,000-ha of land reserved land for rubber plantation.

[Business Day 12/08/15]

26

COMMODITY NEWSRUBBER

EthiopiaSugar Industries Expansion Gear Towards TransformationWith the final phase of the Growth and Transformation Plan II [GTP II] in sight Ethiopia is focused to become one of the top 10-sugar exporting countries in the world. The Ethiopian Sugar Corporation [ESC] notes the annual sugar production rate has risen to 422 million tonnes which besides satisfying local sugar demand excess production will also be exported. Current plantations occupy 70,000 ha which will rise to 290,000 ha in the final phase of GTP II. Also sugar productivity currently at 146 t/ha will rise to 169 t/ha. The first phase, GTP I, saw Government engaged in facilitating sugar projects including construction of dams, irrigation and in preparing farms.

[Herald 10/08/15]

KenyaKenya Inviting Bidders For Sugar Companies It is likely that in September the Kenya Privatisation Commission will invite investors to submit bids for a controlling stake in each of 5-state-owned sugar companies the government is selling - Nzoia Sugar Co., South Nyanza Co., Chemelil Sugar Co., Muhoroni Sugar Co., and Miwani Sugar Co.. The commission is updating due-diligence work necessary to implement the transaction once stakeholder consultations are finalized. It wants to push through the sale of 51% equity in the assets by February 2016. Due-diligence work is expected to be completed by early August, followed by talks with stakeholders including the government and growers. Requests for expressions of interest will be undertaken immediately after completion of the consultations.

Kenya is selling state-owned sugar producers as part of a program to overhaul the industry, which the Food and Agriculture Organization says is beset by dilapidated factories, poor governance and insufficient funding. Domestic production costs can be as high as US$900/MT of refined sugar, compared with US$300/MT in the 19-nation Common Market for Eastern and Southern Africa [COMESA]. Kenya produced 547,800 MT of sugar in 2013, compared with 2.56 million MT in South Africa, the continent’s biggest producer.

[Bloomberg 31/07/15]

27

COMMODITY NEWSSUGAR

MozambiqueMozambique Raising Import Prices The Mozambique Government has decided to more than double prices for sugar imports in order to protect its domestic industry. The benchmark price for the import of brown sugar is to increase to US$806/MT up from US$385, while the price of refined [white] sugar will rise from US$450 to US$932/MT. Previous benchmark prices for sugar imports had been approved in 2001 and were out of step with the current market which has seen the amount of Mozambican sugar sold on the national market falling continuously in the last 3-years.

Sugar entering the Mozambican market comes from countries whose production is heavily subsidised, which means it is sold at very low prices and detrimental on independent small and medium-sized sugarcane producers. Mozambique has 22 associations with over 3,000 members and 447 private producers, who are dedicated to sugarcane cultivation to supply the country’s four sugar companies.

[Macauhub/MZ 06/08/15]

European Union To Fund Sugar ProductionA €1.5 million project funded by the European Development Fund will support 300 sugarcane producers in Mozambique organised into 5-associations to increase their income through guaranteed product placement. The project, formally known as the Small Scale Farmers Development Project will also make it possible for the Xinavane sugar factory to reach full capacity supplied by sugarcane produced by the members of those associations. Xinavane has planted 3,500-ha of sugarcane. The industry produced 422,600T of sugar in the 2014/15 campaign, an 11% increase over the previous year, with 141,400T placed on the domestic market and the remaining amount was exported.

[Macauhub/MZ 14/08/15]

SenegalGovernment Lifts Bans On Imports Of Sugar & PotatoesIt has been reported locally that the Government has lifted a ban on the imports of sugar and potato. A measure that comes as the country reaches a production record of 50,000T. The ban on importation of onions is maintained. Onion production is also at a record level this year with a harvest of 400,000T.

[Ecofin 13/08/15]

SwazilandSwaziland Impacted By Drop In EU Sugar Prices Swazi sugar has seen European Union sugar prices drop by about 50% in a space of 2-years. Swaziland Cane Growers Association (SCGA) noted growers have so far been cushioned by factors such as exchange rates and alternative markets. Large quantities of sugar has been diverted to the Southern African Customs Union (SACU) market which pays a better price. Luckily Africa generally has a net deficit of sugar and Swaziland because of its geographical location has a competitive advantage. The SCGA and the government is working closely with the industry to negotiate favourable trading terms with the continent by leveraging membership of organisations like the Southern African Development Community (SADC), Common Market for Eastern and Southern Africa (COMESA) and Tripartite Free Trade Area (TFTA).

[Swazi Observer 18/08/15]

28

ZimbabweRaw Sugar Prices To Remain StagnantThe price of raw sugar is expected to remain stagnant at US$517/T due to the influx of cheap imports of the processed commodity. Commercial Sugarcane Producers Association of Zimbabwe note prices have been subdued since the selling season started in response to cheap imports of refined sugar that are coming in from neighbouring countries. The producer price of raw sugar is, however, largely determined on the global market and is subject to periodical review. In the past, the price increased as the selling season progressed but this year prices have remained stagnant.

Prior to the land reform programme in early 2000, sugarcane production was a monopoly of Tongaat Hullet, a South African company that still controls the milling and marketing of the crop in the country. Some 15,000-ha have since been allocated to 870 indigenous farmers who produce 20% of national output. Two large privately-owned estates Triangle and Hippo Valley comprise 28,494-ha and produce about 80% of the sugar crop.

[Herald 14/08/15]

29

COMMODITY NEWSSUGAR

EthiopiaMoA To Establish Tea/Coffee AuthorityThe Ethiopian Ministry of Agriculture [MoA] is going to establish a Coffee and Tea Development and Trade Authority to advance Ethiopia’s benefit from the sector targeting the global market. The authority will be accountable for promoting products and prices and will be entrusted with expanding coverage to 1-million ha from 700,000-ha and to increase the income to US$2 billion by 2020. The authority will begin operation after the ratification of the draft regulation by the Council of Ministers and is expected to be launched this fiscal year.

[2Merkardo 17/08/15]

30

COMMODITY NEWSTEA

KenyaStrong Demand Fails To Lift Tea Prices At Mombasa AuctionThere was a slight decline in average price and quantity of tea at the Mombasa auction, despite a strong demand from traders. Tea prices have stabilised above US$3/kg [Sh305] for a straight 7th week, with farmers reaping from the strong dollar against the Kenyan shilling.

According to the East Africa Tea Trade Association [EATTA], prices are better this year because of high demand for teas, against low supply. Prices are around 40-45% higher compared to same time last year where average prices were US$2.13 [Sh217]. During the same period last year, tea traded higher volumes at the auction suppressing the price. Low volumes have been attributed to reduced rainfall which has caused decline in production.

Data from the Agriculture, Fisheries and Food Authority showed total output dropped by 26.9% in Q1 2015. The reduction in output has been tied to delayed rains during the first quarter of the year, a relief to the market which last year battled lower prices due to oversupply. Pakistan, Egypt, United Arab Emirates and UK continued to dominate the top markets for Kenyan tea according to EATTA.

[The Star 31/07/15]

30th July 23rd July

Price per kilo $3.12 [Sh318.10] $3.14 [Sh320.1]*

Quantity 5.62 million kg 5.64 million kg

*The Sh320/kg price is the highest half-year average price recorded in the last 2-years. The highest price last year was US$2.65[Sh270] while 2013’s peak was US$3.09 [Sh315] recorded between January and mid-July.

Tea Industry Facing Shake-Up As Farmers Call For Overhaul Of LawsThe tea sector could face a major shake-up after Bomet County is about to formulate its own laws and an independent tea agency to manage the production and sale of tea produce. The move poses a litmus test for the industry which has been dominated by Kenya Tea Development Agency [KTDA] for decades. Growers note sector laws were skewed in favour of KTDA and that full liberalisation should be embraced so farmers are free to sell their produce to private sector players. The move seeks to challenge the monopoly enjoyed by the KTDA. Growers claim that the farmers had been misled by the KTDA to sign contract forms which binds them not to sell their produce to rival companies and that it is charging farmers unfair prices for fertilisers. Also levying of tea cess by KTDA and other unnecessary taxes should forthwith be scrapped to promote competitiveness.

[Standard Digital 03/078/15]

Limuru Tea H1 Profit Falls Kenya’s Limuru Tea reported a 49% drop in H1 pretax profit after dry weather led to a drop in tea production but noted H2 performance could improve due to better prices. Pretax profit for the period to end-June fell to US$50,831. Limuru Tea said production of black tea fell by 15% to 321 tonnes in H1 2015 compared with the same period a year ago. Revenue fell by 12% to US$409,000. A drought earlier this year hurt output.

[Reuters 17/08/15]

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COMMODITY NEWSTEA

Southern AfricaAngola, Namibia And Zambia To Take Action On Illegal Timber TradeThe first ever collaborative workshop on forest management and timber trade between Namibia, Angola and Zambia ended with agreement on developing a time bound Action Plan for collective forest management and timber trade. The plan will address the growing concern that timber species found in Namibia, Angola and Zambia are subject to overharvesting and associated illegal and unregulated trade. Key areas targeted by the Action Plan include harmonization of documentation, greater sharing of information and data and cross-border collaboration for increased compliance. The workshop was hosted by the Directorate of Forestry of Namibia and supported by Integrated Rural Development and Nature Conservation [IRDNC] and TRAFFIC under a SASSCAL timber project.

High-value species including Kiaat, Zambezi Teak and Rosewood are used domestically for construction but the majority of wood extracted is exported from the region as sawn timber to supply markets in Asia and South Africa. Due to the cross-border nature of the trade, it is critical for the 3-countries to collaborate in addressing the related challenges to ensure that trade in the species is legal and sustainable.

[TRAFFIC 07/08/15]

RESOURCES - SASSCAL - the Southern African Science Service Centre

for Climate Change and Adaptive Land Management www.sasscal.org

- TRAFFIC - www.traffic.org - IRDNC - Integrated Rural Development and Nature

Conservation www.irdnc.org.na

Left to right: Ignatius N Makumba [Director of Forestry, Zambia], Joseph Hailwa [Director of Forestry, Namibia], Domingos Nazaré da Cruz Veloso [National Director of Forests, Angola]

32

COMMODITY NEWSTIMBER

West/Central AfricaSlow Demand From China Dominates Market Sentiment

Okume demand and hence prices continue to be very depressed in contrast to prices and demand for sapele and sipo which remain firm. Padauk is also in demand and prices have improved slightly. The overriding factor influencing the market is slow demand from China. Until recently it was mainly overstocking of okoume which affected purchases but now the overstocking has extended to a wider range of timbers.

For China, demand for species such as belli, okan and even sapele have declined and prices have eased. The stabilisation of equity values on Chinas stock markets has improved consumer confidence but importers remain cautious and will need time to reassess domestic demand prospects which are largely dependent on a more positive outlook for the housing and construction industries. At the moment buyers for China say there is no reason to place new orders when domestic sales have virtually halted.

[ITTO 1-15/08/15]

European Demand In Good Shape Say ProducersIn contrast to the depressing news from China, European markets are in better shape say producers with moderate demand in Germany, Netherlands, Belgium. Italy and UK despite it being the holiday period. Buying for France is always slower in the vacation period but reports from French buyers are that timber continues to lose markets to plastics and aluminium products for joinery such as doors and windows. African producers continue to hope for new market opportunities but are not well equipped for aggressive marketing. Market promotion has been largely ignored in the past as exporters could rely on steady demand in traditional markets.

[ITTO 1-15/08/15]

Sawnwood Prices StableMillers in West Africa report that markets for sawnwood are stable and that demand in some European countries continues to improve. However, okan is still out of favour with buyers and prices remain weak but demand for sapele is good and this has resulted in firmer prices. Prices for sawn bilinga and okoume [FAS GMS] have improved slightly and demand for iroko scantlings said to be firm. Sawn padouk prices have increased again in recent weeks on the back of good demand.

[ITTO 16-31/07/15]

Log Prices Held Up Only By Reduced AvailabilityWhile markets for sawnwood have shown some life, the log market continues to be dull with no sign of any major resurgence in demand from China. What little business can be generated with China revolves around a few select species. There is still no interest from Chinese buyers for okoume logs. Okoume log prices have slipped further in recent weeks driven down by the combined impact of weak demand and the entry of Equatorial Guinea as a supplier of okoume logs to Asian markets. Overall, demand for logs is very quiet but prices have been sustained mainly because of availability issues. In Congo Brazzaville there is strict enforcement of the log export quota system and in Cameroon demand for logs by domestic mills is rising. Analysts point out that if demand for logs was to suddenly revive supply would become a major issue. Log availability would get a boost from plans to allocate a few new concessions in Congo Brazzaville sometime this year but with Cameroon set to ban log exports from January 2016 the prospects for a substantial increase in log supply are dim.

[ITTO 16-31/07/15]

US Tropical Sawnwood Imports Down From AfricaThe US imported 22,608 cu.m. of tropical sawnwood in May, a 20% increase in year-to-date imports from the same time last year. Month-over-month imports from most countries grew with the exception of Cameroon [4,231 cu.m., -22%] and Ghana [363 cu.m., -59%]. The decrease in imports from Cameroon was primarily in sapelli sawnwood. Ghana shipped less acajou d’Afrique in May. Brazil was the largest source of tropical sawnwood imports in May at 4,336 cu.m.

[ITTO 1-15/08/15]

33

COMMODITY NEWSTIMBER

Gabon Producers Hard Hit By Weak Market For OkoumeCurrently West and Central African producers of okoume sawnwood are holding several thousand cubic metres of stock as many orders have been cancelled. This has affected producers in Gabon particularly hard as they have few alternative markets.

In 2015, European imports of okoumé plywood from Gabon have declined further from the low levels recorded in 2014. European imports of Gabonese plywood declined 8.9% to 15,700 [17,200] cu.m in the first 5-months of 2015, following a 2.6% fall to 40,200 cu.m in 2014. Although there has been some small recovery in the main Dutch and Italian markets for okoume plywood in 2015, this has been offset by a decline in sales to France and Belgium.

[ITTO 1-15/08/15]

GhanaExports Register Healthy IncreaseThe volume and value of Ghana‘s wood product exports for the first 5-months of 2015 were up on the same period in 2014. According to the data from the Timber Industry Development Division [TIDD] of the Forestry Commission exports totalled 141,744 cu.m worth €72.74 million compared to the 114,161 cu.m and €46.77 million in 2014. Of the total exports primary products accounted for 23,976 cu.m, secondary products 113,679 cu.m and tertiary products 4,089 cu.m. The leading products in each category were billets [12,464 cu.m], airdry sawnwood [53,975 cu.m] and mouldings [3.955cu.m.]. Markets in Asia imported 83,797 cu.m of Ghana‘s wood products, mainly poles and billets destined for India, followed by African regional markets [20%] and Europe [13%].

[ITTO 16-31/07/15]

SenegalSenegal Announces Nationwide Logging BanAccording to La Nouvelle Tribune, Senegalese President Macky Sall has announced a complete ban on the felling of trees in forests throughout the nation. The move comes as a prevention of the overuse and destruction of Senegalese forests and will remain in force until exploited forests grow back. The recruitment of 400 officials will strengthen the monitoring system. About 40,000 ha of forests were devastated by the exploitation of wood in Senegal.

[IHB 30/07/15]

34

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COMMODITY NEWSTOBACCO

ZimbabweUS$577 Million Tobacco SoldA total of 195.7 million kg of tobacco worth US$576.9 million has been sold to date since the selling season opened in March this year according to statistics released by the Tobacco Industry and Marketing Board [TIMB].Auction floors closed business on July 15 this year while contract sales are still going on. According to the statistics, the seasonal average stands at US$2.95/kg. During the same period last year 212.7 million kg of tobacco worth US$674.7 million was sold at an average price of $3.17/kg. Last year the country produced 216 million kg of the golden leaf, the highest it had achieved in more than 15 years.

Poor prices have dominated the 2015 tobacco selling season, with some prices as low as US$0.06/kg being recorded. Since the adoption of multiple foreign currencies in 2009, the tobacco industry has been one of the fastest to recover from the economic downturn of the past decade. Many farmers have been shifting to tobacco due to the favourable prices. Tobacco is one of Zimbabwe’s major agricultural exports, accounting for 10.7% of Gross Domestic Product [GDP].

[Herald 12/08/15]

Zimbabwe Mulls Use Of Ethanol To Cure TobaccoZimbabwe’s government is sponsoring research into the possibility of using ethanol to cure tobacco as an alternative to wood, which results in the destruction of forests, or considerably more expensive coal. It has already been established that ethanol can be used to produce electricity, as the country’s sole producer of the commodity, Green Fuel, is using it to produce energy to run its production plant. The Zimbabwe Electricity Transmission and Distribution Company estimates that the agriculture sector accounts for between five and eight percent of the country’s total energy consumption and has around 9,200 customers involved in farming.

[The Herald 20/08/15]

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