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CMA CGM ATTENDS SENEGALESE MANGO WEEK

CMA CGM THE EXOTIC FRUIT EXPERT

Full Story On Page 3

AFRICACOM-WATCH

ISSUE 62 | JULY 2016

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AFRICACOM-WATCH

ISSUE 62 | JULY 2016

Contents

03 | General

07 | Cassava

15 | Coffee

CMA CGM Attends Senegalese Mango Week

Nigeria: NCGA Proposes Special Agency To Drive Cassava Programme / Union Dicon Sign Pact On Cassava Cultivation

Regional: African Coffee Output To Stay HighAngola: Coffee Production Needs Bank SupportEthiopia: Export Volume To Hit Record HighKenya: Sector Faces Revival After Task Force Recommendations / Farmers Should Be Paid Cash On DeliverySao Tome & Principe: French Company Invests Over US$10 MillionUganda: Exports Jumped 24% On Year In April / May Coffee Exports Up 9% / Sudan Gives Uganda Two Years to Comply With Coffee Standards

20 | Cotton & TextilesRegional: AbTF & ACTIF Join Forces For Value AdditionBenin: Government Removes Cotton SubsidiesCameroon: State Injects Funds Into Sodecoton / Bayero Bounou Appointed CEO Of SodecotonMali: Dry Weather Threatens Cotton Output TargetTanzania: Farmers In Dilemma As Pesticides Ineffective

24 | Foodstuffs, Livestock & BeveragesWest Africa: Livestock Associations Trained On New MIS PlatformMozambique: Coca-Cola Opens New US$130 Million Bottling PlantNiger: H5N1 Bird Flu VirusNigeria: EU Extends Ban On Dried Beans ImportsSouth Africa: Wine Exports Increase 20% Over Last 4-Years / South Africa To Double Wine Exports To EU / Guaranteed Access To AGOA Until 2025 / Poland Signs Poultry Deal / South Africa Closes Door On Livestock

05 | Cashew, Groundnut, Macadamia & SheaRegional: DNA Sequence Of Groundnut CrackedMozambique: 100,000 Tons Of Cashew SoldNigeria: Government Flags Off 2016 Cashew Expansion ProgrammeSouth Africa: Farmers Benefit From Increased Macadamia Demand / Record Prices For Macadamia

08 | CocoaRegional: Cocoa Supply Crunch / Cocoa Grinders Hit Hard By Poor Bean QualityCameroon: Swiss Buhler Assists Producam Install Kékem Processing Factory / 3,205 Tonnes Exported In MayCote d’Ivoire: Afreximbank Vows US$1 Billion For Projects / COCOBOD To Increase Cocoa Purchases In 2016-2017 Season / Exporter Rejections Rise On Quality / Exporters Allowed To Export Smaller Beans / Arrivals Down 9% / Cote d’Ivoire Seen Missing Cocoa Output Target On Poor Mid-Crop / Rains Strengthen Cocoa Crop / Cote d’Ivoire Seeks Indian Investment In SectorGhana: Shortfall In Cocoa Target / New Rules - Exporters To Submit Forex To Local Banks From July / US$1.8 Billion Syndicated Loan To Finance Purchase Of Beans

22 | FishRegional: Treaty to End Illegal Fishing. Will It Work?East Africa: Road Map To Eliminate Illegal Fishing In Western Indian OceanGhana: Sekondi Fishing Habour ExpansionMozambique: Fisheries Minister Confirms That Ematum Boats Meet EU StandardsNamibia: Fishcor Finances Epalela Fish Farm Renovations

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information. Accordingly the CMA CGM Group denies any liability for any

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from, or actions undertaken on the basis of, such data and information

are the sole responsibility of the reader.

THE AFRICAN COMMODITY REPORTBrought to you by CMA CGM Africa Marketing

Rachel Bennett Dominic Rawle

31 | Palm OilRegional: French Parliament Scraps Tax On Palm OilAngola: Palm Oil Production RelaunchedCameroon: Safacam Production Up & Gets New Director

33 | SugarAngola: Bioenergy Company Starts Selling Sugar Produced In The CountryBurkina Faso: Ivorian State Withdraws From SN SosucoGhana: Ghana Resuscitates Sugar FactoryKenya: Farmers To Earn Interest On Delayed HarvestSouth Africa: Tongaat Hulett Profit Falls On Lower Sugar Output / Illovo Sugar Sees Drought Hits Earnings / Cane Production Declines By More Than 16.3% Y/Y / Bevsa Welcomes KPMG Sugar ReportTanzania: Duty On Imports To Rise Up To 25% / Mikumi Gets Sugar FactoryZambia: Commissions K500 Million Refinery Plant

37 | TeaKenya: Tea Directorate Releases Sh 18 Million For Infrastructure Improvement / Tea Earnings Go Up On Good Weather / State Permits Direct Tea Export / World’s First Tea Futures Contracts May Start In Kenya

39 | TimberRegional: EU Reviews Impact Of VPA, EUTR / Call For Tenders: Support Services For Implementing EUTR, FLEGTCentral/West Africa: Demand Trend Shifts To Quality Rather Than Pursuit Of Lowest Price / Sawn Okoume Coming Back Into Fashion / Veneer Exports To EU GrowAngola: Moçâmedes Railway To Transport Wood / Timber Potential Estimated At 57 Million Cu.MCongo: Mandatory Processing On The CardsGabon: Will Kiln Dried Requirement Apply To All Species? / Expansion Of Peeling Capacity In Gabon / Customs Inspection Process Even Tighter – Pushes Up Transaction CostsGhana: Inaugural Stakeholders’ Conference On WoodTogo: Ten Year Suspension On Teak TradeZambia: Timber Concession Ban

44 | TobaccoMalawi: Prices Pick Up As Quality Leaf Arrives At Auction / Leaf Rejection Rate Hits Record 90% / Farmers Request Government Permission To Sell Leaf AbroadZimbabwe: TIMB To Test Run Electronic Auction System

27 | Fruit, Vegetables & HorticultureAngola: Angola To Increase Banana Exports To DRCCameroon: New Plantain Banana Processing UnitGhana: Injaro Invests In Pineapple Sector / Dutch Program Helps Ghana To Overturn EU BanEthiopia: Earns US$230 Million From Horticulture ExportsMorocco: Morocco Allowed To Export Citrus To The USA From OctoberSenegal: Senegal Supports Cherry Tomato Producers / Exports 16,770T Of Mangoes In 2015South Africa: Navel Orange Exports Taking ShapeZambia: US$4.5 Million Invested In Potato Production / Zambia Drafts Fruit & Veg Standards / Disease May Trigger Tomato Price

32 | RubberRegional: Michelin Adaopts Zero Deforestation Policy For Its Rubber Sourcing

CMA CGM Attends Senegalese Mango Week CMA CGM Senegal teams as well as employees of the Dakar Containers Terminal [TCD] recently participated in Mango Week organized by USAID and Senegal’s Ministry of Economy. Inaugurated by Senegalese Prime Minister, Mahammed Dionne, Mango Week gathered industry stakeholders from Senegal, Burkina Faso, The Gambia, Ghana, Guinea, Guinea Bissau, Mali and the Ivory Coast, to build a regional value chain and agree on a formal Alliance.

CMA CGM Exotic Fruit ExpertiseCMA CGM teams met with regional exporters to present the strengths of its weekly EURAF 1 service, promote their know-how and expertise in global refrigerated transport and win new partnerships. The Group’s TCD inland services were particularly appreciated by the local and regional exporters. With their young genset fleet and accompanying technicians, they ensure transportation of these delicate fruits to Dakar.

There are many different varieties of mango, each varying greatly in shape, colour, size and weight. Given its delicate properties controlled atmosphere transport is used to extend transport and storage. We use specialist reefer containers to move such sensitive cargoes. Reefers are used to carry all kinds of cargo requiring temperature control, such as chilled or fresh produce primarily fruits, vegetables and dairy products.

Mangoes are highly pressure- and impact-sensitive and appropriate care must therefore be taken during cargo handling by our expert reefer teams. Mangoes can be suitable for transportation in controlled atmosphere but we mainly use controlled temperatures – optimally loaded in reefer containers with a temperature of 12.2 - 13.3°C and a relative humidity of 85 – 90%.

CMA CGM owns one of the largest and youngest fleets of Reefer containers designed for the transport of perishable goods in a temperature-controlled environment. The CMA CGM Reefer fleet consists of 20’, 40’ High Cube and 45’ PalletWide [32/33] containers equipped with the latest remote control system enabling a permanent monitoring of all units on board.

Harvest SeasonsThe African mango production lasts from March until September. The first country to go into production is Cote d’Ivoire in mid-April, followed by other countries like Ghana and Mali. Senegal is the last country to start its season, from July to September.

ContactsFor rates and bookings of mango and other exotic fruits contact your nearest local CMA CGM agent or for enquiries in Senegal please contact Daniel Carvalho on e-mail dka.dcarvalho @cma-cgm.com

http://www.cma-cgm.com/products-services/line-services/

flyer/EURAF1

EURAF 1Weekly Service Between

Europe and Senegal

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COMMODITY NEWSCORPORATE

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

Senegal has a production volume of 125,000T of mango per year. However, only 16,937T of this volume has been exported, while most of the annual volume isn’t exploited at all. One of the objectives of the US AID is to help Western African countries create added value for its mangoes. In 2012 Senegal exported 8,000T. This year its exporting over twice that amount.

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RegionalDNA Sequence Of Groundnut CrackedA team of 51 scientists from nine institutes in India, China, Australia and the US have decoded the complete DNA sequence of groundnut. The move may help in development of improved groundnut varieties with enhanced traits such as increased pod and oil yield, drought and heat tolerance and greater disease resistance.

[Economic Times 01/06/16]

Mozambique100,000 Tons Of Cashew SoldCashew sales in the 2015/16 agricultural season totalled 100,000T and a value of US$23.1 million. The National Cashew Institute [Incaju] noted the amount of cashews sold last year was a 25% increase on the previous year, when 80,000T were sold to the Asian and American markets. Unprocessed cashews were sent to India and Vietnam, whilst the nuts were sent to the United States. The biggest challenge for the sector is to increase annual production to 120,000T in the next few seasons. In Mozambique the provinces of Nampula, Zambezia, Manica, Inhambane and Gaza are the largest producers of cashews and this activity is conducted on a large scale by family-based producers.

[Macauhub/MZ 16/06/16]

NigeriaGovernment Flags Off 2016 Cashew Expansion ProgrammeThe Federal Government has commenced the planting of 2,000 cashew seedlings to kick start the 2016 cashew planting season and Cashew Expansion Programme in Ife, Osun State, Nigeria. The government wants to revive cashew farming to earn more foreign exchange. The government will roll out 2-million cashew seedlings annually to sustain the programme.

According to the National Cashew Association of Nigeria [NCAN] last year, Nigeria generated US$253 million from exporting Cashew nuts. Nigeria is the 6th largest cashew producer in the world after Cote d’Ivoire, India, Vietnam, Tanzania and Guinea Bissau. At the moment, Nigeria produces about 160,000 MT of cashew every year. Nigeria’s target is to raise production to 500,000 MT by 2020, and also be able to develop a processing capacity of 70% which is about 350,000 MT.

Cashew is one of the 13 Non-oil Strategic Export Products [NSEPs], which are to be used to diversify the economy away from oil under the Nigerian Industrial Revolution Plan of the Federal Ministry of Trade and Investment.

[Channels 08/06/16 & Nigeria Bulletin 14/06/16]

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COMMODITY NEWSCASHEW, GROUNDNUT, MACADAMIA & SHEA

South AfricaFarmers Benefit From Increased Macadamia DemandMacadamia farmers in Mpumalanga are set to rake in huge profits this harvesting season, thanks to an increase in demand from the United States and Chinese markets. The harvest season is now in full swing and more nuts are being brought into factories for processing. Drought has obviously reduced yields and affected the size and proportions of the nuts but market conditions are good with the rand/dollar exchange in favour of farmers and high overseas demand.

[Fresh Plaza 08/06/16]

Record Prices For Macadamia Global macadamia prices have reached record high levels amid reduced supply due to the drought in South Africa. However the lack of marketing campaigns to promote a niche consumption could result in reduced future prices. The country also faces increasingly stringent quality requirements. The normal has become a 22mm and up sized Nut-in-Shell [NIS] with a 1.5% unsound which in a drought year is near impossible as the nuts are smaller.

Globally there is an increase in consumer demand of around 7% p.a. There is also growth in China as consumers increase and living standards improved as well as a higher demand from confectioners. Brazil has also reported an increase of more than 20% in macadamia consumption due to the acknowledgement of health benefits and vegan trends.

The global macadamia supply for 2015 was 170,000T NIS up 30% from 2012 at 130,000T. Worldwide plantings are rising rapidly and the industry has predicted a 500,000T crop by 2022. South Africa is currently planting at a rate of over 600,000 trees per annum while China is expected to add 2-million trees per year. Brazil will add an additional 120,000 trees over the next 4-years, while Guatemala planted 200,000 trees last year.

[Fresh Plaza 10/06/16] 6

NigeriaNCGA Proposes Special Agency To Drive Cassava ProgrammeThe Nigeria Cassava Growers Association [NCGA] has proposed the establishment of a Cassava Development Board or Commission to drive cassava value chain, which they observed could inject N10 trillion annually into the Nigerian economy.

[Business Day 14/06/16]

Union Dicon Sign Pact On Cassava CultivationThe Ebonyi State Government has signed a Memorandum of Understanding [MoU] with Union Dicon Salt Plc for large scale production and processing of cassava in the state. The State will contribute 15,000-ha for Union Dicon Salt to grow cassava and establish a factory where cassava products would be processed into raw materials for export and domestic use.

[Eagle 25/05/16]7

COMMODITY NEWSCASSAVA

RegionalCocoa Supply CrunchA supply crunch that’s boosted prices will last until year-end, when production may rebound in West Africa, according to Sucres et Denrees SA. The worst desert winds in 3-decades that reduced the quality of cocoa in West Africa means some beans won’t be processed this season, making an expected shortage of 280,000 MT appear bigger in the physical market.

Beans from the mid-crop are too small to be exported and the quality is too low even for local grinding. That’s helped attract speculators, pushing cocoa futures traded in London to near the highest in more than 4-years. The earliest we will see good-quality beans reaching the market is December and with higher prices being paid to farmers, the odds at the moment are that production will rebound.

[ESM 11/06/16]

Cocoa Grinders Hit Hard By Poor Bean QualityWest African cocoa grinders have slashed output or suspended operations due to a lack of beans fit for processing heightening to the risk of a supply deficit. Port arrivals in leading grower Cote d’Ivoire are lagging behind last year due to poor weather, while Ghana is set for only a modest recovery from last season’s failed crop.

Cote d’Ivoire is currently harvesting its mid-crop, which runs from April to September. Ghana has yet to fix a period for marketing its light crop this season and is expected to offer grinders discount on light crop beans, determined by their size. Grinders buy the bulk of mid-crop and light crop beans, which are smaller than main crop cocoa, but this season they have been in short supply. Everyone is reducing grinding capacity to be able to keep working, as it costs more to close and reopen than to reduce output. Meanwhile the bean count is high at 140, 150 or even 160. However some processors noted they would probably have to shut down if the beans did not improve in July and August.

Neighbouring Ghana has a much smaller grinding sector, processing less than 30% of its total cocoa output. The government and cocoa regulator Cocobod want to increase capacity and process half the crop domestically. However, its grinders are also facing difficulties this year. Last season, many Ghana-based grinders imported beans from Ivory Coast to keep factories running. But that’s unlikely to be an option this year.

[Reuters 14/06/16]

Supply IssuesCote d’Ivoire will struggle to export more than 100,000T of cocoa during the remainder of the mid-crop, less than half that amount shipped a year earlier. With bean quality suffering, grinders will need to tap cocoa stockpiled in other parts of the world, such as Europe and the U.S. Due to the low quality, grinders will also need to process more beans to get the same amount of butter. Ivory Coast’s Le Conseil du Cafe-Cacao has allowed exporters to ship smaller beans in a bid to deal with deteriorating quality.

High prices could spur more future production at a time demand isn’t growing, potentially moving the market into a significant surplus next year. The global chocolate market shrank 2.6% in September to February. So the view in the chocolate market that the world would need 1 million tons of additional cocoa by 2020 took into account annual consumption growth of 3-3.5% and that’s not happening. With Cote d’Ivoire raising prices paid to farmers, there’s a risk of consecutive years of large surpluses emerging.

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COMMODITY NEWSCOCOA

CameroonSwiss Buhler Assists Producam Install Kékem Processing Factory Producam is to invest FCfa 9 billion in a 30,000T/p.a cocoa processing factory in Kékem, Western region. The foundation stone of this factory, built thanks to the expertise of Swiss company Buhler, was laid on 16th June. The facility aims to produce 12,000T of cocoa butter and 6,000T of powder annually. The project benefits from Governmental financing of FCfa 1.3 billion, as well as significant tax and customs exemptions.

The Kékem facility will be duplicated in Mbalmayo, Central Region. Cameroon produces on average 200,000T of cocoa over the past 5 years, but only processes around 25% of its production locally. The recovery plan for the sector aims to raise this level to 50% by 2025, by which time the country proposes to produce 600,000T of beans.

[Business in Cameroon 20/06/16]

3,205 Tonnes Exported In MayCameroon exported 3,205 MT of cocoa in May as the season heads into an inter-crop period, down from 5,780 MT in April and 7,610 MT in March. The National Office of Cocoa and Coffee [ONCC] noted Olam bought 1,424 MT, followed by AMS with 551 MT and Telcar with 300 MT. Less cocoa is being produced and there is a slowdown in activity during this period but the figures will go back up with the start of the cocoa campaign in August.

[Reuters 03/06/16]9

COMMODITY NEWSCOCOA

Cote d’IvoireAfreximbank Vows US$1 Billion For ProjectsThe African Export-Import Bank will provide as much as US$1 billion in finance for cocoa and cashew projects as Cote d’Ivoire seeks to increase its domestic processing capacity. The bank is offering loans to private investors and projects owned by the state, which will also guarantee the finance. The move supports the government’s industrialization program which aims to process locally 50% of cocoa and cashew-nut production by 2020. The country currently grinds 31% of its cocoa crop and processes 15%of the cashews it grows. Afreximbank’s announcement follows recent adopted tax incentives to boost cocoa grinding in the world’s biggest producer. The country is also the continent’s largest grower of cashews. The industrialization program will support growth.

[Bloomberg 31/05/16]

COCOBOD To Increase Cocoa Purchases In 2016-2017 SeasonAfter parliament approved the Ghana Cocoa Board’s US$2 billion Syndicated Loan for the 2016/2017 crop season, the board has decided to increase its cocoa purchases for the season in question, by 50,000T. This brings COCOBOD’s total target for purchases for the 2016/2017 crop season to 900,000T, and at an average price of US$3,100/MT, bringing total revenue after sales to US$2.79 billion.

Having succeeded with the first step, which is the approval from parliament, COCOBOD is now set to engage a consortium of banks in an attempt to raise the finance. Institutions include Deutsche Bank, Natixis of France, Nedbank Limited of South Africa, Standard Chartered Bank, Societe General, Bank of Tokyo-Mitsubishe UFJ Limited, with the DZ Bank AG of Germany as Co-Arranger.

[Pulse 04/06/16]

Exporter Rejections Rise On QualityExporters are rejecting roughly half of cocoa port arrivals on quality grounds, adding to problems that are already expected to result in a 180,000T global supply deficit this year. The rejections are due to high acid levels and small bean size. Farmers are also struggling to dry beans because of recent heavy rains. The Coffee and Cocoa Council [CCC], has fixed a ceiling of 120 beans/100g for beans destined for export during the April to September mid-crop. But exporters said that average bean counts are coming in between 125 and 160. The decline in bean quality is blamed on a prolonged dry season and particularly harsh Harmattan desert winds during a critical period for mid-crop development. The rains have now improved but it is likely to be weeks or even months before they have an impact on bean quality.

The rains have also damaged the dirt tracks linking many plantations to the main roads in Ivory Coast’s western cocoa-growing heartland, increasing the transport times from bush to port, bringing further deterioration in bean quality.

[Reuters 07/06/16]

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Cote d’Ivoire

Exporters Allowed To Export Smaller BeansThe Ivorian cocoa marketing board will allow companies to export smaller beans than usual for the rest of this season because of a weak crop. The Coffee and Cocoa Council [CCC] said in a note to exporters on June 7 that it has authorized the export of beans with a count of 125 beans per 100 grams, up from the previous ceiling of 120 beans per 100 grams. The change reflects the smaller sized beans that were shrunk by a prolonged dry season and harsh winds.

Exporters have long called for the ceiling to be raised and complained that the previous level for beans destined for export during the April to September mid-crop was too low. According to them, the counts have been coming in between 125 and 160 per 100 grams. Last season the average size was 110 beans per 100g. Now, many say it is too late to make a difference.

[Reuters 09/06/16]

Arrivals Down 9%Cocoa arrivals at Ivorian ports reached around 1,354,000 MT by June 12 since the start of the season on Oct. 1, 2015, down from 1,493,000 MT in the same period of the previous season. However, exporters estimated around 28,000 MT of beans were delivered to the ports of Abidjan and San Pedro from June 1-5, up from 24,000 MT during the same period last year.

[Business Recorder 13/06/16]

Cote d’Ivoire Seen Missing Cocoa Output Target On Poor Mid-CropIvorian cocoa output is unlikely to rebound before the end of the mid-crop, meaning 2015/16 production in the world’s top grower is likely to fall short of a government forecast. The Coffee and Cocoa Council, has forecast production for the 2015/16 season which ends in September at 1.6 million tonnes, down from a record of nearly 1.8 million tonnes last year. Other exporters and analysts gave expected production ranging from 200,000 to 250,000 tonnes lower than in 2014/15 blaming poor weather, including the worst Harmattan winds in 3-decades, for the drop

Port arrivals are already lagging last season’s levels by more than 130,000 tonnes at the end of May and the International Cocoa Organization [ICO] raised its 2015/16 global cocoa deficit forecast to 180,000 tonnes last month from 113,000 tonnes.

Meanwhile the recent rains, far from improving the situation, may in fact harm output in the early stages of next season which opens in October. Flowers and cherelles that would have developed into cocoa for next season have been stripped from the trees by heavy downpours.

[Reuters 09/06/16]

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COMMODITY NEWSCOCOA

Cote d’Ivoire

Rains Strengthen Cocoa CropAbundant rain and sunny spells improved growing conditions in Ivory Coast’s cocoa regions offering respite after an especially harsh dry season. The long dry season reduced the size and quality of beans, especially for the mid-crop which runs from April to September. But continued good weather through June could help crops in the last few months of the season.

[Reuters 31/05/16]

Cote d’Ivoire Seeks Indian Investment In SectorCote d’Ivoire is seeking investment from India’s private sector, particularly in processing cocoa, to further strengthen trade ties with India. President Pranab Mukherjee, made a 2-day trip as part his 3-nation Africa tour.

[Indian Express 14/06/16]

GhanaShortfall In Cocoa TargetGhana bagged only 690,000 MT of cocoa beans for the 2015/2016 main crop season out of a target of 850,000 MT missing its target by 160,000 MT. The shortfall has been attributed to poor managerial policies of the Ghana Cocoa Board [Cocobod] and unfavourable weather conditions. The crop yield 2014/2015 was 740,254.06 MT. According to industry experts Cocobod is likely to generate only about 40,000 MT of beans between now and September when the light crop season ends due to the current weather pattern and other factors. This will mean that the total cocoa production for the 2015/2016 crop season will be about 730,000 MT, leaving a shortfall of 120,000 MT of cocoa beans still to procure.

[Ghanaweb 09/06/16]

New Rules - Exporters To Submit Forex To Local Banks From JulyThe Bank of Ghana has issued new directives requiring cocoa and mineral exporters to sell the portion of their foreign exchange to be surrendered, directly to local commercial banks and not the central bank from July 1, 2016. The central bank said export receipts from the cocoa syndication loan and exporters under retention agreements who are allowed to operate offshore accounts will be exempt from the new rules on the repatriation of export proceeds. By the amendment, exporters will have to repatriate their export proceeds from an external bank to their foreign exchange account at a local bank. Exporters with multiple foreign exchange accounts will repatriate to the local bank which endorsed the export documents, after which the exporter will then have to sell the forex to any local bank within 3-working days.

[GBN 03/06/16]

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Ghana

US$1.8 Billion Syndicated Loan To Finance Purchase Of Beans The Ghana Cocoa Board [Cocobod] has announced the closing of a US$1.8bn pre-export finance facility to fund the 2016/17 cocoa crop. Payback of the loan hinges on the ability of COCOBOD to purchase 900,000 MT of cocoa within the period. However some government officials are questioning the attainability and believes that COCOBOD can only purchase about 700,000 MT.

The Bank of Tokyo-Mitsubishi UFJ, Deutsche Bank, Natixis, Nedbank, Rabobank, Société Générale and Standard Chartered acted as co-ordinating initial mandated lead arrangers [MLAs] and bookrunners. DZ Bank also acted as bookrunner and Ghana International Bank as initial MLA on the receivables-backed facility. Bank of China, Crédit Agricole CIB, Intesa SanPaolo, Rand Merchant Bank, Sumitomo Mitsui Banking Corporation, ABN Amro and KfW Ipex-Bank joined the facility as senior MLAs ahead of the launch of general syndication on June 7.

This is 3-banks fewer than last year: Barclays, HSBC, Commerzbank, Qatar National Bank and Standard Bank have left the consortium, while Bank of China and Rabobank have joined it.

[GTR 13/06/16]13

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)

1 Jun 16 2207.85 3097.17 2206.67 3010.67

2 Jun 16 2221.07 3120.49 2219.67 3034.67

3 Jun 16 2221.95 3115.69 2214.00 3011.00

6 Jun 16 2223.12 3139.27 2234.33 3041.67

7 Jun 16 2237.22 3165.09 2231.33 3075.00

8 Jun 16 2238.14 3168.92 2229.67 3090.00

9 Jun 16 2238.96 3165.82 2235.00 3091.33

10 Jun 16 2244.61 3168.02 2251.33 3101.67

13 Jun 16 2256.13 3176.66 2272.33 3114.33

14 Jun 16 2251.93 3166.51 2280.33 3105.67

15 Jun 16 2235.05 3142.96 2248.67 3090.67

16 Jun 16 2177.97 3064.84 2222.00 2996.00

17 Jun 16 2203.48 3108.40 2221.00 3040.67

20 Jun 16 2234.88 3167.47 2199.00 3100.00

21 Jun 16 2241.79 3179.91 2206.67 3119.00

22 Jun 16 2254.41 3192.83 2215.33 3131.33

23 Jun 16 2263.31 3218.07 2214.67 3154.33

24 Jun 16 2177.76 3044.66 2275.00 2986.00

27 Jun 16 2162.87 3009.96 2309.67 2961.00

28 Jun 16 2168.25 3025.54 2310.67 2972.00

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RegionalAfrican Coffee Output To Stay HighThe US Department of Agriculture has noted African coffee production will retreat from record highs in 2016-17 but will remain high – helped by a climb by farmers to higher altitudes in the face of climate change fears. Africa’s main 4-coffee-growing countries, Ethiopia, Kenya, Tanzania and Uganda, will see production drop by nearly 1 million bags to 11.97m bags to 2016-17. The decline will reflect drops in both output of arabica beans - which account for the majority of African output, and indeed originated in Ethiopia - and robusta crops in some countries, as a hangover from the latest, bumper harvest.

Coffee trees have a habit, unless carefully managed, of showing cycles of alternate higher and lower production years. Even so the 2016-17 crop would - if it meets the expectations of the USDA attaches - rank as the second biggest ever, behind only the record 2015-16 harvest, which at 12.91m bags, far exceeded initial expectations. Output in Ethiopia, Africa’s top grower, is expected to continue to buck the biennial production cycle and gain for a successive year, showing a small rise to a record 6.52m bags.

African coffee output forecasts, 2016-17 and [year-on-year change] Source: USDA

Ethiopia 6.518m bags +0.1%

Uganda 3.70m bags -17.8%

Tanzania 1.05m bags -16.0%

Kenya 700,000 bags +7.7%

Total 11.965m bags -7.3%

The increase reflects largely growth in commercial output, while production of forest-grown and lower-yielding coffee in south-western areas declines.

African coffee export forecasts, 2016-17 and [year-on-year change] Source: USDA

Ethiopia 3.525m bags +0.2% Government is supporting measures to boost yields which, at 0.7-0.8T/ha, are half those of Brazil. There is a shift by farmers to elevated highland areas to escape climate change.

Uganda 4.0m bags unchanged The 2016-17 crop, at 3.70m bags, will fall 800,000 bags short of the record 4.5m-bag crop last time, with the decline due to the biennial bearish cycle.

Tanzania .03m bags -15.6% Output will fall by 200,000 bags to 1.05m bags, due to the biennial bearing cycle.

Kenya 650,000 bags unchanged Output will rise in 2016-17, recovering from levels at the last harvest which, at 650,000 bags, were the lowest in more than 50 years, hurt by dryness, blamed on El Nino, as well as higher labour costs and the loss of plantation area to development.

Total 9.205m bags -2.0%

The production declines will feed through into a drop in exports too from the 4-countries although, at a combined 9.21m bags, they would still be the third biggest on record. Exports in 2015-16 are pegged at 9.39m bags, although the all-time high was set in 1996-97, when shipments reached a combined 9.50m bags. Indeed, Africa’s recent uptick in production contrasts with a long-term decline in its coffee fortunes from previous peaks reached in the mid-1990s.

[Agrimoney 17/06/16]

15

COMMODITY NEWSCOFFEE

AngolaCoffee Production Needs Bank SupportAccording to the Angolan Association of Coffee and Palm [Cafang] the coffee sub-sector in Angola lacks a bank or a financial institution dedicated to meet the needs of farmers. The main obstacles faced are feasibility studies as per the bank requirements as well as discouraging interest rates. Cafang is also focusing on creating coffee cooperatives. The demand for Angolan coffee is growing, with buyers from Israel, Lebanon, China and Russia joining the traditional importers from Portugal, Spain, Italy and Germany.

[Macauhub 02/06/16]

EthiopiaExport Volume To Hit Record HighEthiopia is likely to hit a record high volume of annual coffee export by the end of the current fiscal year. During the past 11-months Ethiopia exported 174,000T or 96% of the intended 180,000T. The performance surpasses last year’s data by almost 12%. It is expected exports will hit over 200,000T.

Performance was attributable to key government activities such as strengthening modern coffee marketing system, increasing production and productivity, creating favourable condition for producers, traders, processors, exporters and service providers.

Ethiopia’s globally famous finest coffee brands are Harrar, Sidamo and Yirgacheffee. The country is the 1st in Africa, 5th in world production and the world’s 3rd largest Arabica producer. Coffee is mainly exported to Germany, Saudi Arabia and United States America.

[Ethiopian News Agency 24/06/16]

16

KenyaSector Faces Revival After Task Force RecommendationsThe coffee sector has faced several problems including a decline in production which was down to 40,000T in 2015 from 130,000T in the 1990s. Income earned has also gone to Sh15.18 billion from Sh50.6 billion.

During the peak years, a tree of coffee produced 30KG of coffee cherry a year. Today, the yield has gone down to 2KG per year. A recently launched report notes corrupt cooperatives and a lack of policies that take the interest of farmers to heart.

To address this President Kenyatta appointed a team earlier this year to review the coffee value chain and identify areas that require interventions such as production, processing and marketing of coffee. Undertaken by Professor Joseph Kieyah and Dr Richard Leresian Lesiyampe, the 19-member task force identified, among other things, that the current laws governing the subsector are restrictive and do not allow farmers to freely participate in the coffee value chain.

Meanwhile the delay in coffee payments resulted in farmers borrowing expensive loans which ultimately lower their earnings and at the same time dissuaded youths from growing coffee altogether. It was also established that there are serious institutional weaknesses in key institutions that deal with the coffee sub-sector.

To restore the sector to its former glory, the task force proposed a raft of measures which includes the enactment of new coffee sub-sector regulations, the amendment of some sections of the Crops and AFFA Acts 2013. It also recommends reviewing and fast tracking the enactment of both the Warehouse Receipt Systems Bill 2015 and the Geographical Indication Bill, and the incorporation of Nairobi Coffee Exchange into a public company limited by guarantee.

It also recommends the establishment of a 3-year subsidy programme that will cost Sh1.21 billion in the 2016/2017 financial year and Sh2.47 billion in the next 2-financial years. The funding will go to fertilizer subsidy, the provision of planting materials and research and rehabilitation of pulping stations which will include the digital weighing machines, ICT electrification and piping of clean water.

To address the payment delay issue, the task force recommends the establishment of a cherry advance fund of Sh2.1 billion in the 2016/2017 financial year that will boost Sh500 million in the 2018/2019 financial year due to projected increase of coffee production. The amount will be provided by the Commodities Fund and a Central Depository Unit. And it recommended that the Nairobi Coffee Exchange be a commodity exchange.”

To deal with corruption in the sub-sector, the task force proposes that cooperative society commission not to exceed 15% of the net earnings from coffee sales. Growers and millers should also negotiate and agree on the cost of export bags and the agreed cost to be included as part of the milling agreement. Additionally, it recommends the end of marketing agents who have for a long time been rigging coffee prices as they act as brokers for the dealers – dealers are those who ideally buy coffee from the Nairobi Coffee Exchange.

To lure the youth into coffee farming, a coffee business school should be established at Utalii College. Other incentives include waiver of import duty on commercial coffee house equipment and support value addition initiatives such as coffee vending, coffee kiosks and youth-owned coffee house start-ups.

[Capital Business 24/06/16]

Farmers Should Be Paid Cash On DeliveryPresident Uhuru Kenyatta has received the Coffee Task Force Report from the 19-member Presidential National Task Force on Coffee Sub-Sector Reforms at State House, Nairobi. The report recommends that farmers be paid at least 40% of the prevailing price on the spot for cherry they deliver. Depending on the market prices, the minimum advance payments farmers will get for a kilo of cherry will be Sh15.

The report also recommends that a subsidy programme be put in place, to cater for smallholder and small estate coffee farmers offered as a package, to include fertiliser, planting materials for new varieties, capacity building and training farmers and rehabilitation of at least 500 coffee pulping stations. Cooperative societies, Saccos and unions are also set for relief as the taskforce calls for the waiver of any outstanding debt, to enable the recovery of the sub sector. It is estimated that the sector has accumulated debt worth about Sh3 billion.

The task force, which has been sitting since May, has also made a raft of recommendations aimed at reviving the sector. [Star 11/06/16]

17


Sao Tome & PrincipeFrench Company Invests Over US$10 Million French company Malongo Mane plans to invest over US$10 million on coffee plantations on the island of Sao Tome. The company will also explore cocoa and vanilla plantations. The concession contract will last for a minimum period of 20 years, under a pre-agreement signed just over 2-years ago by the French company and the Ministry for Agriculture and Rural Development on behalf of the government. In 2015, coffee was the third most exported product from Sao Tome and Principe on a list headed by cocoa, which is still the main driver of the Sao Tome economy, accounting for around 93% of all annual revenue.

[Macauhub/CV 15/06/16]18

UgandaExports Jumped 24% On Year In AprilAccording to the state-run Uganda Coffee Development Authority [UCDA] exports from Uganda, Africa’s largest exporter of beans, increased by 24% on the year in April as farmers released more stocks to the market due to improved prices. Shipments jumped to 326,793 60-kg bags, up from 264,065 bags exported in the same month last season. April exports also jumped 32% over the 247,838 bags exported in March. Farm gate prices for robusta beans, generally used in instant coffee and blends increased by around 6% in April, inducing farmers and exporters to release more stocks.

Concerns over robusta availability in global markets are mounting due to anticipated lower output in India and Indonesia following a severe drought, pushing prices to multi-year highs. Cumulative coffee shipments in the first 7-months of the 2015-16 season increased 8% to 2 million bags, setting the country on course to register record exports. Robusta shipments, which account for more than 70% of the total exports, jumped 4% to 1.4 million bags. Uganda expects coffee output in the 2015-2016 season to be a record 4.8 million bags, aided by favourable weather conditions and new plantings.

[Market Watch 30/05/16]

May Coffee Exports Up 9%Uganda Coffee Development Authority [UCDA] noted coffee exports last month rose by 8.9% compared with shipments in the same period last year. Exports of the beans in May reached 286,758 60-kg bags, up from 263,330 bags shipped in the same period last year.

[Reuters 24/06/16]

Sudan Gives Uganda Two Years to Comply With Coffee StandardsSudan has given Uganda a 2-year grace period to comply with its new standards of coffee exports or else lose the market. On average, Uganda exports over 0.8m bags of coffee annually to Sudan, making it the leading importer of the country’s coffee in Africa and second importer in the world for the last 15 years. The understanding was reached during a meeting held in Sudan’s capital - Khartoum where a delegation from Uganda’s Trade ministry met the Sudan Standards Metrology Organisation [SSMO].

In May 2015, the SSMO sent notification to Uganda informing them about their new regulations regarding the pre-shipment inspection of commodities imported into Sudan which included coffee. The inspections are to be done against a new green coffee grading standard - [SDS: 1605.2015] for coffee imports. Uganda had originally been given a grace period of 6-months to comply which was later extended to 3-more months ending June 15 2016. But this has now been extended to 2-years.

The new Sudan standards differ from what Uganda coffee grading system and the green coffee grading protocol in several parameters such as coffee grades, moisture content and requires testing for agricultural chemical residues, radioactivity, microbiological and biochemical contaminants.

Additionally Sudan appointed an inspecting company [Bureau Veritas] to carry out pre-shipment inspection of the Uganda coffee exports to Sudan. Unfortunately their laboratories are located in Mombasa, Kenya, which because of the time and expense of analysis, makes Ugandan coffee non-competitive.

[Monitor 20/06/16]

19


RegionalAbTF & ACTIF Join Forces For Value AdditionTo strengthen their cooperation, Aid by Trade Foundation [AbTF] and the African Cotton and Textiles Industries Federation [ACTIF] have announced their strategic partnership for more value addition in the African cotton and textile industry. The 2-organisations have set themselves the goal to increase productivity, competitiveness and sustainability of cotton production and to strengthen the textile production in Africa together. Along with sustainable and certified Cotton Made in Africa [CmiA] cotton the partnership can build up an integrated textile value chain on the African continent suitable for the domestic as well as international textile markets.

[Cotton made in Africa10/05/16]

BeninGovernment Removes Cotton SubsidiesThe Benin government will no longer subsidize the cotton sector following a Council of Ministers meeting on 15th June. The move follows a sectorial takeover by the private sector. Therefore there will be no state subsidy for fertilizer or the purchase of seed cotton. The net purchase price of seed cotton to be paid to producers by the ginners is 260 CFA francs per kilo for first seed cotton and 210 FCFA/kg for the second choice. The net price for organic cotton is 312 FCFA/kg.

[Ecofin 16/06/16]

20

COMMODITY NEWSCOTTON & TEXTILES

CameroonState Injects Funds Into Sodecoton With an estimated cost price of FCfa 858/kg, Sodecoton recorded a deficit of FCfa 35 on each kilogram of cotton exported, as global prices stood at FCfa 823. Thus is in order to prevent a reduction in the producer purchase price of cotton the government has had to pay a subsidy of FCfa 6 billion in 2015 to Sodecoton, in order to balance its accounts.


Bayero Bounou Appointed CEO Of SodecotonBayero Bounou has been appointed as General Manager of Société de développement du coton [Sodecoton] following an extraordinary Board of Directors held on June 20th. The move is a recovery bid to help support the company.

[Ecofin 21/06/16]

MaliDry Weather Threatens Cotton Output Target According to the Malian Company for the Development of Textile [CMDT] a lack of rain threatens to prevent Mali reaching its cotton production target of 650,000T in the 2016/17 season. June is usually a good month for seedlings but there is minimal rain so only 47% of the seedlings have been produced. Mali has had difficulty meeting its harvest goals before. Last season’s crop of 513,553T was far less than the 650,000T target, also because of damage linked to late arrival of the rain. The cotton harvest in Mali runs from April to April. Production begins in May-June and ends in September-October. Commercialisation starts in October-November and ends at the end of March.

[Reuters 23/06/16]

TanzaniaFarmers In Dilemma As Pesticides IneffectiveAccording to Tanzania Cotton Board [TCB] the 2016 crop marketing season is likely to be opened the second week of June. However farmers have seen crops badly damaged by pests despite the application of pesticides. TCB had earlier projected bumper harvests but due to the ineffectiveness of the bug killers, production is likely to drop drastically.

[Daily News 08/06/16]

21

COMMODITY NEWSCOTTON & TEXTILES

RegionalTreaty to End Illegal Fishing. Will It Work?The European Union, United States and 28 other countries have ratified and brought into force the first global treaty that aims to put an end to illegal fishing and enforce a previous United Nations agreement. The Port State Measures Agreement [PSMA] comes after 7-years of negotiations among nations as geographically far flung as Iceland, Oman and Uruguay, but the treaty holds special promise for African nations in their long struggle to protect their territorial waters from illegal fishing boats.

The treaty requires participating countries to prevent access to ports until they’ve verified detailed information in advance about every vessel seeking entry, conducting standard inspections when vessels enter and denying access when necessary. Fishing boats are permitted to dock only at special ports equipped for enforcement and inspection. When officials complete a failed inspection, they’re required to both deny access and report violations, sharing that information with the vessel’s home country as well as with neighbouring countries and their ports.

Yet the treaty raises real questions about enforcement. The stakes are high, notably in coastal nations like Mozambique as they seek to protect their rich waters from illegal fishing. In 2013, only one of the 130 ships fishing off Mozambique’s shores was actually from that country, prompting the government to order 30 ships to take advantage of its own ocean resources. The order included 24 fishing ships as well as six patrol boats to protect the fleet and fend off illegal fishing activities. When Mozambique ratified the PSMA in 2014, the World Wildlife Fund estimated that illegal fishing cost it US$35 million a year.

Critics rightly point out that in order for the UN treaty and similar regional or NGO initiatives to properly function, more countries need to ratify and implement them to create a real impact. The private sector should be on board as well, especially the insurance industry, which many experts believe is a low-cost option to stop illegal fishing by denying coverage to operators who currently have no difficulty obtaining it. A collaborative international effort that aligns public and private interests is more likely to succeed in protecting both local economies and the environment.

[Huffington Post 20/06/16]22

COMMODITY NEWSFISH

East AfricaRoad Map To Eliminate Illegal Fishing In Western Indian Ocean The 5th FISH-i Africa Task Force meeting, held 14-16 June, worked on a road map to end and eliminate Illegal, Unreported and Unregulated Fishing [IUU] in the western Indian Ocean. The road map is to be presented at the ministerial meeting of Members States to help renew commitment in the fight against illegal fishing.

The Task Force meeting was a joint initiative of the ministry of Ocean Economy, Marine Resources, Fisheries, Shipping and Outer Islands and Stop Illegal Fishing which is an African based independent organisation that aims to stop illegal fishing in African waters. Around 40 representatives from the 8-member countries [Comoros, Kenya, Madagascar, Mauritius, Mozambique, Seychelles, Somalia and Tanzania] as well as law enforcement agencies and international partners participated. Measures initiated to combat IUU include the setting up of a Fisheries Monitoring Centre, setting up of a Port State Control Unit for boarding and inspection of fishing vessels and implementation of a National Plan of Action to combat IUU.

Sharing vessel data real-time and accessing satellite tracking expertise, FISH-i Africa is a Task Force that enables authorities to identify and act against large-scale IUU.

[Government of Mauritius 14/06/16]

GhanaSekondi Fishing Habour Expansion According to the Ghana Ports and Habours Authority, [GPHA], the Albert Bosomtwi Sam Fishing Harbor in Sekondi, is scheduled to undergo an expansion project in the first week of July. The 21 year old harbor covers some 1.4 ha of land and 12.6 ha of sea. It is 15 km from the Takoradi main port. It is equipped with a cold store, an ice making plant, offices, a berthing bay for inshore vessels, a jetty for canoes and a net dry area.

[Citi97.3 20/06/16]

MozambiqueFisheries Minister Confirms That Ematum Boats Meet EU StandardsMozambique’s Minister of the Sea, Inland Waters and Fisheries noted that the 24-boats of the Mozambique Tuna Company [EMATUM] are fully compliant with European Union [EU] specifications covering both seaworthiness and health and hygiene. Hence the tuna they catch can be exported to the EU.

[AIM 08/06/16]

NamibiaFishcor Finances Epalela Fish Farm RenovationsThe National Fishing Corporation of Namibia [Fishcor] has financed the renovation of the Epalela Fish Farm in Omusati at a cost of N$2 million. Epalela is the biggest government fresh water fish farm in the country. Fishcor is the holding company of Seaflower Whitefish Corporation, in which the Ministry of Fisheries and Marine resources is a shareholder.

[Namibian 07/06/16]

23

COMMODITY NEWSFISH

West AfricaLivestock Associations Trained On New MIS PlatformMembers of West Africa’s regional livestock association are learning how to use a new livestock market information system [MIS] to give and receive updates on meat and animal feed prices as well as information on transport costs and truck availability. The MIS was developed by the West Africa Trade Hub [WATH] in partnership with ImageAd, a Ghana-based IT company, with inputs from members of Confédération des Fédérations Nationales de la Filière Bétail/Viande [COFENABVI], the umbrella organization including national livestock federations in Burkina Faso, Côte d’Ivoire, Ghana, Mali, Niger, and Senegal.

[WATH 07/04/16]

MozambiqueCoca-Cola Opens New US$130 Million Bottling Plant The Coca-Cola Bottling Company officially opened its world-class bottling facility in Matola Gare, near Maputo, on 21st June. The plant, built over 3-years at a cost of US$130-million, is the largest green-field facility in Coca-Cola Sabco’s history across its seven-country regional market in Africa. Capable of bottling 48,000/hr, the facility is the largest bottling line in Sabco’s regional footprint that includes Ethiopia, Kenya, Mozambique, Namibia, South Africa, Tanzania and Uganda. Coca-Cola Sabco is 80% owned by Gutsche Family Investments and its headquarters are in Port Elizabeth.

[Engineering News 21/06/16]

NigerH5N1 Bird Flu VirusNiger has reported an outbreak of the highly pathogenic H5N1 bird flu virus at a poultry site in Niamey. H5N1 bird flu has spread across a number of West African countries in the past 2-years, hitting poultry farms. The outbreak, which killed all 86,000 poultry birds at the affected site. Meanwhile Cameroon also reported an outbreak that killed several thousand birds a poultry breeding centre in the capital Yaounde. The authorities there have banned the transport of chickens.

[News Asia 03/06/16]

24

COMMODITY NEWSFOODSTUFFS, LIVESTOCK & BEVERAGES

NigeriaEU Extends Ban On Dried Beans ImportsThe European Union [EU] has extended its ban on importation of dried beans from Nigeria by 3-years to allow Nigeria implement the appropriate risk-management measure and provide required guarantees. The ban was imposed in June 2015 over high levels of pesticide considered dangerous to human health.

[Premium Times 09/06/16]

South AfricaWine Exports Increase 20% Over Last 4-YearsSouth African wine exports were up a further 5% in 2015 and the industry is expecting even more growth in 2016 as South African wine continues to find new global markets. The country is the 7th largest producer of wine in the world and for the 12 months preceding June 2015, wine production was at 959 million liters, with 423 million litres sold for export.

Not only is South Africa producing some fantastic wines, but the struggling rand is actually helping wineries as it offers a lucrative export market. The UK is by far the biggest receiver of South African wines with 109 million litres, Germany is second with 79 million while Sweden, France, Netherlands and Denmark all take between 20-25 million. Canada [18 million], USA [11 million], Belgium and China [9 million each] and Japan and Switzerland [6 million each] make up the other big export markets.

[South African 30/05/16]

South Africa To Double Wine Exports To EUSouth Africa plans to double exports of duty-free wine after a trade agreement between southern African countries and the European Union [EU]. The Economic Partnership Agreement [EPA] between the EU and Southern African Customs Union, which include Namibia, Lesotho, Swaziland and Botswana, means South Africa can export 110 million litres of duty-free wine, up from the current 48 million litres. The EU accounts for 75% of the nation’s annual offshore wine sales, valued at US$330 million.

[IOL 13/06/16]

25

COMMODITY NEWSFOODSTUFFS, LIVESTOCK & BEVERAGES

South Africa.Guaranteed Access To AGOA Until 2025South Africa has been guaranteed access to the African Growth and Opportunity Act [AGOA] until 2025, the Department of Trade and Industry [DTI] announced. All issues regarding beef, poultry, and pork have been resolved paving the way for continued preferential access into the US market for the duration of AGOA.

The priority remains leveraging market access opportunities that arise from AGOA and there are currently no discussions on a Free Trade Agreement with the US within the Southern Africa Customs Union. Discussions between the US and South Africa would continue with the aim of enhancing “mutually beneficial trade and investment between the two parties” and facilitating market access of products of export interest to South Africa such as chicken breasts, goat embryos, ostrich meat, apples, citrus, avocados, mangoes, and litchis. Litchis will access the US market in 2016.


Poland Signs Poultry Deal The Polish government has negotiated a health certificate with the South African government, paving the way for poultry exports to South Africa. Poland’s health inspector, Krzysztof Jadewski, concluded the deal with his South African counterparts in Pretoria. Negotiations over quotas, customs duties, tariffs, and business contracts will now take place. Poland is also trying to negotiate a health certificate to allow Polish pork into South Africa. Poland is also looking to export vegetables and cereals and had already sold a significant quantity of wheat to South Africa last year.

A Polish delegation participated in the continent’s biggest food and beverage expo, Africa’s Big 7, which was held in Johannesburg. South Africa is Poland’s biggest trade partner by far in Africa, with the bi-lateral agricultural sector worth US$112-million and total trade worth US$900-million.


South Africa Closes Door On LivestockA new import regulation for the export of cattle, sheep and goats from Namibia, Botswana, Lesotho and Swaziland, according to the South African Government Gazette No. 714, is aimed at protecting that country’s animal health status. The new regulations, effective from 1st July, involve strict animal health testing, and will basically close the door on imports. The new conditions will result in extra testing and quarantines for the animals, resulting in fewer animals becoming eligible for export – around 10% are expected to be certified.

[Namibian 20/06/16]

26

AngolaAngola To Increase Banana Exports To DRCIn 2015, the Caxito-Rega company exported 200T of bananas from Angola to the Democratic Republic of Congo [DRC]. The company estimates the figure could rise to 1,200T this year with exports extended in the near future to Namibia and other Central African countries. Exports to the European market are also being tested.

The 5th edition of the Banana Fair was held 26-29th May in Dande, Bengo province which leads the country’s banana production with 700,000T. The event was organized by the Provincial Government of Bengo in partnership with the Ministry of Agriculture. Under the theme “Diversify Production to Promote Economic Growth”, the event was attended by over 300 national and international exhibitors. China confirmed its presence with 3-companies.

[All Africa 30/05/16]

CameroonNew Plantain Banana Processing Unit On the 10th June Sapisacam [Société d’actions prioritaires intégrées de développement agricole au Cameroun] and the agro-industrial Spanish company, Tomsa Destil, signed a partnership agreement in Yaoundé for the construction of a plantain banana processing unit. The project aims to set up plantations that will produce 500,000T of plantain annually. Meanwhile, the factory will produce 200,000T of crisps, 300,000T of plantain flour and 1.2 billion litres of ethanol.


27

COMMODITY NEWSFRUIT, VEGETABLES & HORTICULTURE

GhanaInjaro Invests In Pineapple SectorInjaro Investment Advisors has announced its first investment in Ghana’s pineapple sector through its venture capital fund, Injaro Agricultural Venture Capital Limited [IAVCL]. IAVCL has signed an agreement to invest in Gold Coast Fruits Limited [GCF], a Ghanaian pineapple exporter based in Accra.

Founded in 2005, GCF is one of Ghana’s leading exporters of ‘Golden Sweet’ [MD2] pineapple with customers in Switzerland, France, The Netherlands, Morocco, and the United Arab Emirates. The investment by Injaro will help GCF increase the volume and quality of fruit grown on its farms, expand its reach and market share in rapidly growing emerging markets, and source fruits from a larger number of smallholder farmers.

[Ghanaweb 20/16/16]

Dutch Program Helps Ghana To Overturn EU BanThe Ghana Vegetable [GhanaVeg] Programme, which was introduced by the Dutch government, is working through the horticultural value chain to help Ghana overturn a European Union [EU] ban on exports of selected vegetables. Last year the EU banned the exports of chillies, aubergine and other vegetables from Ghana to stop the introduction of pests into the ecosystem of the EU. Since the ban, Ghana has lost more than US$2 million worth of exports of selected vegetables to the EU market.

[Graphic 17/06/16]

EthiopiaEarns US$230 Million From Horticulture Exports The Ethiopian Horticulture Development Agency noted the country secured over US$230 million from horticulture exports during the first 10 months of current fiscal year. US$188.5 million was earned from flower exports while vegetables and fruits exports reached US$41.24 million. Comparing the performance to last year’s the export shows nearly a 14% rise. The main export destinations were the Netherlands, Germany, Saudi Arabia, Norway, Belgium, United Arab Emirates [UAE], France, Japan, U.S. and Djibouti.

[Fana 16/06/16]

28

MoroccoMorocco Allowed To Export Citrus To The USA From OctoberLast January, American health authorities stopped Moroccan citrus fruit entering the country. Morocco normally exports 9% of their citrus fruit to the USA, 20% to the EU and almost half to Russia. Moroccan citrus exports to the USA were suspended due to the presence of Mediterranean fruit fly larvae in a batch of clementines. Morocco and the USA have come to an agreement to deal with this fly and have decided that exports can resume from October 2016.


Senegal

Senegal Supports Cherry Tomato ProducersMorocco is seeing Senegal as serious competition on the international cherry tomato market. The Grands Domaines du Senegal [Compagnie Fruitière], a leader in Senegalese horticulture, has spent €25 million installing giant greenhouses that have a production capacity equalling 14,000T of vegetables a year. The Senegalese tomato market is 95% export based.


Exports 16,770T Of Mangoes In 2015According to ASEPEX [Senegalese Export Agency] mango exports from Senegal reached 16,770T in 2015. These exports were towards sub-regions and Europe. Senegalese mangoes were the only ones on the European market over the summer. Thanks to their taste, the Kent variety is the most exported. ASEPEX plans to create a regional mango alliance in order to increase the African mango’s market share and make a national brand. The sector produces 125,000T and exports 16,000T.


The continued presence of dichlorvos [pesticide] in dried beans imported from Nigeria and maximum residue levels of pesticides shows that compliance with food law requirement as regards pesticide residual cannot be achieved in the short term.

“”

29

COMMODITY NEWSFRUIT, VEGETABLES & HORTICULTURE

South AfricaNavel Orange Exports Taking ShapeCitrus exports from South Africa are going well. Volumes of grapefruit are short and lemons are experiencing a huge demand which is making them scarce. Navels however, are now available as harvest started 2-3 weeks ago and demand is good with exports going to Canada, UK and the EU and the Middle East prior to Ramadan. The big volumes will start in around 2-3 weeks and prices are pretty much the same in comparison to last year but the exchange rate is giving a slight advantage to the growers and exporters. Spain and Turkey finished their citrus seasons early leaving a clear European market.


ZambiaUS$4.5 Million Invested In Potato ProductionA project which aims to substitute potato imports, as well as create export opportunities for the crop, has been set up in Zambia. Potato seed for smallholder farmers in Northern Province will be produced through the partnership between AgDevCo and Saise Farming Enterprises Limited. AgDevCo has invested US$4.5 million in a partnership which will primarily be a seed potato farm hub and act as an anchor investment within the Northern hub.


Zambia Drafts Fruit & Veg StandardsTo assist local exporters in competing in regional and foreign trade, the Zambia Bureau of Standards [ZABS] in conjunction with stakeholders has drafted standards for farm produce. The standards, which will cover tomatoes, carrots, green bananas, onions and oranges, amongst others will help promote product quality and safety. The draft standards provide for product specifications, and requirements for packaging, ripening conditions, storage and transportation of fruits and vegetables for all handlers.


Disease May Trigger Tomato PriceThe Ministry of Agriculture notes Tuta Absoluta a pest that has affected tomatoes in Zambia is likely to trigger a rise in the price. The pest originates from Latin America damages crops from leaves to the fruit.

[ZNBC 17/06/16]

30

RegionalFrench Parliament Scraps Tax On Palm OilFrance’s National Assembly has scrapped plans for an additional tax on palm oil, which had caused outcry among major producers, after the government put forward an alternative proposal that would include other vegetable oils used in food. Legal uncertainty around the tax, which focused on only one type of vegetable oil and contained a tax exemption based on sustainability criteria that were not clearly identified, had prompted the change.

[Reuters 23/06/16]

AngolaPalm Oil Production RelaunchedThe provinces of Bengo, Benguela, Cabinda, Cuanza Norte and Uíge have been identified to receive palm tree projects. The Minister of Agriculture said his department had received investment proposals for palm oil production. In addition Angola has been conducting research into palm growing, setting up specialised stations for palm research and implementing a palm renewal process. Institutions from the Philippine, Malaysia and Indonesia are cooperating to assist the sector.

[Angola Press 15/06/16]

CameroonSafacam Production Up & Gets New DirectorEric de Foresta will replace Yannick Vernet as Managing Director of the Société Africaine Forestière et Agricole du Cameroun [Safacam – African Logging and Agricultural Company of Cameroon]. Safacam production increased by 311T up from 13,828T in 2014 to 14,139T last year. Safacam’s palm oil was sold at FCfa 478.1/kg in 2015, against FCfa 445 a year before.


31

COMMODITY NEWSPALM OIL

RegionalMichelin Adopts Zero Deforestation Policy For Its Rubber SourcingMichelin Group, one of the world’s three largest tire companies, has just adopted a zero deforestation policy for its rubber sourcing. The move is significant because rubber is a major driver of tropical forest destruction through the conversion of natural forests for plantations. Forests in West Africa and Southeast Asia have been particularly hard hit by the commodity’s production.

[Mongabay 13/06/16]32

COMMODITY NEWSRUBBER

AngolaBioenergy Company Starts Selling Sugar Produced In The CountryAngolan bioenergy company Companhia de Bioenergia de Angola [Biocom] will start selling sugar to wholesalers and retailers as the first sugarcane harvest officially began on 17th June. Production levels will be around 47,000T.

At this initial stage the sugar will be sold on the domestic market, but the company plans to start exporting when the plant is producing at its maximum installed capacity of 256,000T/yr in the 2019/2020 agricultural season. The second phase of investment in 2020-21 will see Biocom increase production to 4 million tons of sugarcane, 523,000T of sugar and to double current power production.

Biocom, which is part of the Capanda Agro-industrial Hub, is a partnership between the Angolan State, through the National Agency for Private Investment [ANIP] and Sonangol Holding, with a 20% stake, and Angolan group Damer and Brazil’s Odebrecht, each with 40%.

[Macauhub/AO 21/06/16]33

COMMODITY NEWSSUGAR

Burkina FasoIvorian State Withdraws From SN Sosuco The Ivorian government has announced plans to sell 17,922 shares in New Sugar Company Comoé [SN Sosuco], the leading sugar company of Burkina Faso. SN Sosuco, provides 25% of Burkina’s sugar consumption at around 30,000T and operates 10,000 ha of sugar cane.

[Ecofin 21/06/16]

GhanaGhana Resuscitates Sugar FactoryGhana has refurbished the old Komenda Sugar Factory in a bid to save US$200m in sugar imports. President Mahama opened the US$36.5 million facility this month. The plant has a production capacity of 125,000 MT, 25% bigger than the former facility. Critics noted the lack of local feedstock, unattractive prices offered to local cane producers as well as high cost and erratic power supply as potential hurdles.

[Africa Report 03/06/16]

KenyaFarmers To Earn Interest On Delayed HarvestFrom 1st July Kenyan millers will pay cane farmers monthly for delays in harvesting their crops in a shift that puts pressure on the loss-making factories. Kenya’s agriculture regulator said millers will be expected to pay a monthly interest penalty, equivalent to the prevailing bank lending rate of 18%, on the value of crops after 24-months. The average maturity period of sugar cane in Kenya is 18-months. The penalty will put further strain on the millers struggling to pay farmers for crops delivered.

[TVC 14/06/16]

34

South AfricaTongaat Hulett Profit Falls On Lower Sugar OutputSouth Africa’s Tongaat Hulett Ltd’s full-year profit fell 18%, in line with its estimate, due to weak global sugar prices and low production caused by severe drought. Volumes were impacted by lower cane yields due to the severe drought in KwaZulu-Natal and poor growing conditions with low rainfall and restricted irrigation levels in Mozambique and Zimbabwe as a result of low water and dam levels. Production for the year ended March 2016 declined by 291,000 T to 1.023 million T from last year’s 1.314 million T.

On a plus side Tongaat, which also operates in Swaziland, Mozambique and Zimbabwe, expects to benefit from improved local sugar market revenues following import protection measures implemented in its local markets.

[Reuters 30/05/16]

Illovo Sugar Sees Drought Hits EarningsIllovo Sugar reported a 36.5% drop in full-year profit as lower export prices and a severe drought in southern Africa weighed on its performance. Direct and indirect drought impacted all 6-countries of operation, currency volatility and high interest rates in various jurisdictions, and reducing domestic sales demand in Malawi, as well as on-going pressure on sugar export revenues, combined to weigh heavily on the group’s results. Illovo operates in South Africa, Mozambique, Tanzania, Malawi, Zambia and Swaziland. Persistent dry weather across the region will further delay the anticipated sugar production recovery during the 2016/17 season, with a particularly adverse impact expected in Swaziland.

[Reuters 06/06/16]

Cane Production Declines By More Than 16.3% Y/YAs a result of the ongoing countrywide drought, South African cane production declined during the 2015/16 season by more than 16.3% to 14.81-million tons, following an 11.4% reduction recorded in the previous season. The South African Cane Growers Association [SACGA] also found that real revenue per hectare decreased by 4% and real operating expenditure decreased by 4%, which led to a 5% decrease in real earnings before interest and tax.

According to the Southern African Customs [SADC] Union, total South African sugar sales to the local market, including Botswana, Lesotho, Namibia and South Africa, increased by 1.53% compared with the 2014/15 season, a large portion of which could be attributed to sustained demand from industrial customers. The SACGA added that the European Union sugar policy reform made this preferential market less lucrative for SADC suppliers, who continued to take advantage of their quotas to supply the South African market, which curbed South African sales growth.

SACGA aims to improve communication with local grower councils to address strategic needs through monitoring work programmes. SACGA also registered Womoba to manage the roll-out and commercialisation of projects to address the sustainability of growers. These included a biogas project focused on research opportunities in the food and beverage market, as well as an investigation into the on-farm efficiencies in sugar cane farming through the use of various technologies.


Bevsa Welcomes KPMG Sugar ReportThe Beverage Association of South Africa [BevSA] has welcomed a report by accounting and auditing firm KPMG calling for a socioeconomic impact assessment [SEIAS] of the sugar tax proposed by National Treasury. In the report, titled ‘Taxing your sweet tooth – Effective nudge or economic burden?’, KPMG strongly recommended that an investigation be conducted into how consumers would respond to a tax on sugar-sweetened beverages in terms of behavioural change. BevSA supported the call for an SEIAS on the proposed sugar tax, which National Treasury wanted to implement from April 2017. The proposed sugar tax would have a number of implications for the beverage industry, as well as for consumers and the national fiscus, which BevSA felt needed to be fully understood before any tax was introduced to ensure that there were no unintended negative consequences.


35

COMMODITY NEWSSUGAR

TanzaniaDuty On Imports To Rise Up To 25%The government is to raise import duty on sugar from 10 to 25% after accusing importers of sabotaging local industries. Tabling the 2016/2017 national budget in Parliament on 8th June, Finance and Planning Minister, Dr Philip Mpango, said the increase in custom duty on sugar and sugar confectionery will protect local factories. The government is taking all these measures as the current 10% is weakening domestic sugar factories. The rise will be phased in all East African partner states.

[Citizen 09/06/16]

Mikumi Gets Sugar FactoryLocal investors are finalising proposal to build a small scale sugar factory in Mikumi. The investors, under Geoman Cane Estate Limited, received US$287,000 support from the Southern Agricultural Growth Corridor of Tanzania [SAGCOT]’s Trust Fund to boost their activities meant to expand market for farm produce from small scale farmers. The factory will have the capacity to produce 150T of sugar per day at starting stage before reaching its maximum 500T. The growers, under Mikumi Sugarcane Growers Association, have the capacity of producing between 5,000-10,000T of canes a year. Output will assist reducing the country’s sugar deficit by 1.3%.

[Daily News 24/06/16]

ZambiaCommissions K500 Million Refinery PlantZambia Sugar Plc has partially commissioned the K500 million sugar refinery. The facility will more than double sugar production to 90,000 from 40,000T annually and become Africa’s single largest sugar producer. The move will also see increased exports to the Great Lakes region and other markets within Africa.

[Daily Mail 13/06/16]

- 2016/17 custom duty will increase from 10 to 15% - 2017/18 to rise from 15 to 20% - 2018/19 raised from 20 to 25%

36

KenyaTea Directorate Releases Sh 18 Million For Infrastructure ImprovementThe Kenyan Tea directorate has released Sh18 million to 5-tea factories for improvement of infrastructure in the following tea growing areas: Iria-ini, Gathuti, Gitugi, Ragati and Chinga. Funds will be distributed to factories through chairmen of tea collection centers.

[Standard 02/06/16]

Tea Earnings Go Up On Good WeatherKenya’s export earnings from tea grew by 34% in Q3 of the current financial year, helped by high demand from the country’s major buyers and a strong dollar. Data from the Tea Directorate indicate that the earnings increased to Sh35 billion between January and March compared to Sh26 billion in the corresponding period last year. The value of Kenyan tea also improved from Sh219 to Sh277/kg - a significant growth. Figures indicate that exports to the United Kingdom, Egypt and Afghanistan grew substantially while the quantities purchased by Pakistan, which is the country’s leading buyer of black tea, grew marginally. Volumes exported to Egypt between January and March went up 34% to 24 million kg from 17. 8 million kg last year. Egypt has been one of Kenya’s major tea buyers but the volumes had been dwindling in the recent years due to civil unrest.

[Daily Nation 25/05/16]

State Permits Direct Tea ExportIn an unprecedented move, local companies and farmers’ organisations have been given the go-ahead to directly export tea to international markets. The government’s decision is aimed at cutting off unscrupulous middlemen who have continued to eat into the farmers’ profits. The government has introduced several new measures to stamp out the exploitation of tea farmers and tea companies and now counties have been allowed to export the tea directly into the world market and seek those buyers who would buy it at high prices.

[Daily Nation 30/05/16]

37

COMMODITY NEWSTEA

Kenya

World’s First Tea Futures Contracts May Start In KenyaKenya is considering introducing the world’s first futures contracts for tea leaves to help stabilize prices and enable growers to guarantee income from their production. INTL FCStone Inc., based in New York, has held talks with industry representatives in Kenya about introducing the derivatives. The company has prepared a report for clients in Kenya on the securities’ potential. The Nairobi Securities Exchange is already planning to start trading equity-index and currency futures in H2 2016 and supports the proposal.

While there are futures contracts for commodities such as coffee and orange juice, there aren’t for tea because of the difficulty in standardizing the plant given differences in types and quality over seasons and harvests. The Nairobi exchange would need to get approval from the Capital Markets Authority to start trading tea futures. The process of drawing up product specifications and getting approval from the CMA could take up to 1-year.

Volatility in prices coupled with increasing production costs have made the sector increasingly unattractive, subjecting farmers to diminishing returns, according to the Kenya Tea Development Agency. The average auction price of tea sold in Mombasa has fallen 22% this year to US$2.25/kg after surging 34% last year.

Kenya generated US$1.2 billion from tea exports last year, the second-biggest source of foreign-currency earnings after remittances by citizens living abroad. The crop is mainly grown by 560,000 small-scale farmers who supplied 399,000 MT of tea last year.

[Bloomberg 16/06/16]38

RegionalEU Reviews Impact Of VPA / EUTROn 4th May, the European Commission [EC] published a comprehensive independent evaluation of the EU FLEGT Action Plan. The Plan encompasses the wide range of EU policy measures introduced over the last decade to support good forest governance and remove illegal wood from trade. Key amongst these are the EU Timber Regulation [EUTR] and the Voluntary Partnership Agreements [VPAs] now being implemented by 6-tropical countries and negotiated by another 9-countries. The report assesses progress since the Plan’s publication in 2003 and makes recommendations for future action. The report’s central conclusions are positive:

- The plan is assessed to be a relevant and an innovative response to the challenge of illegal logging - Has improved forest governance in all target countries. - Raised awareness of the problem of illegal logging at all levels - Contributed to improved forest governance globally and particularly in partner producer countries - Reduce demand for illegal timber in the EU.

The plan is heading in the right direction and does not need a major overhaul with main pillars and action areas retained, but FLEGT support to producing countries should be delivered in a more demand-driven and flexible manner, while bottlenecks affecting VPAs should be addressed and the private sector more involved.

The report highlights that while the Action Plan is contributing broadly to its specific objectives, it’s effectiveness across action areas varies widely. It notes that progress on trade aspects of the plan has been a particular area of weakness and that there is a need for greater focus on VPA and EUTR implementation and private sector engagement. The report suggests that the VPA process has yet to deliver on the Action Plan objective of increasing market confidence for timber from participating countries.

[ITTO 16-31/05/16]

Call For Tenders: Support Services For Implementing EUTR/FLEGT The Call for Tenders “Support services for implementing the EU Timber Regulation and FLEGT Regulation” has been published. Time limit for receipt of tenders is 11 July 2016. The purpose of the contract is to provide support to the European Commission in assisting the EU Member States in monitoring the implementation and enforcement of the EU Timber Regulation [EUTR] and EU Forest Law Enforcement Governance and Trade [FLEGT] Regulation and in carrying out the specific tasks required from them by the Regulations, through monitoring trends in trade in timber and timber products, report preparation, compilation and analysis, monitoring implementation and enforcement measures, information to the public, and participation in meetings.

[ITTO 1-15/06/16]

RESOURCESTo access the European Commission’s evaluation of the EU FLEGT Action Plan please go tohttps://ec.europa.eu/europeaid/sites/devco/files/report-flegt-evaluation.pdf

The direct FLEGT objective of decreased EU imports of illegal wood is being achieved.”“

39

COMMODITY NEWSTIMBER

Central/West AfricaDemand Trend Shifts To Quality Rather Than Pursuit Of Lowest PriceLog prices were unchanged throughout May and show no signs of movement even though there are reports of some modest increases in demand. Over the past few months analysts note a developing trend towards demand for better quality wood products with both buyers and consumers, through their own choice, being prepared to pay a fair price for a good product rather than pursuing the lowest price. There are reports of some demand for okoume logs in Equatorial Guinea and Congo Brazzaville and this is mainly from buyers for the Chinese market. There were some slight movements in sawnwood prices during the second half of the month. Producers are satisfied with the current [slight] upward trend in demand and expect this to continue into Q3 2016.

[ITTO 16-31/05/16]

Sawn Okoume Coming Back Into FashionProducers report that trading conditions in Q2 were quiet but satisfactory. Looking ahead to the end of H1 it is unlikely there will be any significant changes in current prices. While it will be some time before sufficient trade statistics become available to assess the reliability of the increase in demand from China and other major importer countries it is apparent that buyers for the Chinese market are currently more active than they were during Q1 with an emphasis on sawnwood. Buyers for China are now more selective and taking a narrow range species. Over recent weeks there has been an upswing in purchases on sawn okoume for the Chinese market in addition to the steady but subdued demand for logs.

[ITTO 1-15/06/16]

Veneer Exports To EU GrowThe positive trend in EU imports of veneer from tropical countries continued into 2016. Imports were 73,300 cu.m in Q1, up 14% compared to the same period in 2015. Imports increased from all the main supply countries during the period including Gabon [+6% to 36,900 cu.m], Côte d’Ivoire [+11% to 16,800 cu.m], Cameroon [+45% to 5,900 cu.m], Congo [+72% to 5,100 cu.m] and Ghana [+42% to 2,800].

[ITTO 1-15/06/16]

40

AngolaMoçâmedes Railway To Transport Wood The Moçâmedes Railway [CFM] will commence shipment of wood on a large scale from Kuando Kubango to Namibe, through Lubango. CFM noted the new service whose contracts are being finalised, will increase the company’s revenues. CFM will create a dry port in Arimba, on the outskirts of Lubango, and another in Sacomar in Namibe, where the goods will be unloaded and taken directly to the port. The Moçâmedes railway carries 15,000T of cargo a month on 32 trains between the towns of Menongue, Lubango and Namibe.

[Macauhub/AO 08/06/16]

Timber Potential Estimated At 57 Million Cu.MAngola’s exploitable timber potential is estimated at 57 million cu.m. The volume of timber available for annual exploitation is approximately 1.2-1.9 million cu.m of which 340,000 cu.m are in natural forest and 850,000 cu.m of planted forest. In 2015, the country produced 125,000 cu.m of timber. Production and potential is expected to grow with investments underway in the private and public sectors.

[Angola Press 15/06/16]

CongoMandatory Processing On The CardsIn the Republic of Congo it was rumoured that the previous Minister of Forests was considering a policy for mandatory further processing of some or all export sawnwood but the new minister has not alluded to this idea so far. Exports from the Republic of Congo were hard hit during the downturn in Chinese demand for logs last year which prompted consideration of diversifying timber exports.

[ITTO 1-15/06/16]

41


GabonWill Kiln Dried Requirement Apply To All Species?There is still no official announcement from government in Gabon on their proposal that all export sawnwood should be kiln dried. Millers and exporters in Gabon have pointed out that kiln drying is not a market requirement for species such as azobe and okan when used for applications such as sea defence works. In related news, the structure and aims of the proposed Gabon Timber Marketing Board are still under discussion and there is no news on when the Board could be constituted.

[ITTO 1-15/06/16]

Expansion Of Peeling Capacity In GabonThe ban on log exports in Gabon is still in place and observers report that some Chinese companies, which were previously trading logs, are investing in milling capacity to produce peeled okoume veneers for export. Log buyers say that Gabon okoume is of superior quality in terms of texture and appearance compared to okoume from neighbouring countries. If this is the case then the investment in peeling capacity in Gabon will yield high quality veneers. No decision yet on kilning requirement or marketing board in Gabon.

The proposal for mandatory kiln drying of export sawnwood is reported to be slowly moving through the government systems along with a proposal to establish a timber marketing board. There is no information as to when or even if these policies will be adopted with or without the suggestions offered by the timber industry.

[ITTO 16-31/05/16]

Customs Inspection Process Even Tighter – Pushes Up Transaction Costs The ban on harvesting, processing and export of kevazingo remains in place while the government is continuing to assess and inspect stocks held by timber companies and traders. There are ongoing discussion between the government and private sector on the high Customs Charges for container scanning. Analysts say the Gabon Customs Department seems determined to maintain the current rates and now require even more detailed documentation before exports are approved.

[ITTO 16-31/05/16]

42

GhanaInaugural Stakeholders’ Conference On WoodA national stakeholders’ conference on the local wood and furniture industry has been held in Accra under the theme: “Developing the Wood Industry, Prospects and Challenges”. The conference, the first of its kind, brought together estate developers, furniture companies, Forestry Commission [FC], Ghana Standards Authority [GSA], financial institutions, and development partners to promote marketing, financing and revival of the wood and furniture industry in Ghana. It allowed stakeholders the opportunity to identify the availability of raw materials and the various standards within the furniture industry so as to be able to produce and export to sub-regional markets.

[Ghana Web 02/06/16]

TogoTen Year Suspension On Teak Trade The government of Togo has authorized a 10-year suspension on the import and transport permits relating to Pterocarpus erinaceus tree on over-exploitation. Authorities said Pterocarpus erinaceus, commonly false teak tree, is subject to intensive export toward Asian countries from Lome Autonomous Port.

[Xinhua 24/06/16]

ZambiaTimber Concession BanThe Zambia Association of Timber and Forestry Based Industries has appealed to President Lungu to intervene and lift the suspension on the issuance of forest concession licenses. The prolonged suspension, which was effected in December 2015, is adversely affecting the timber industry through increased illegal timber activities. Although the association supported the move by government to temporarily suspend the issuance of forest concession licenses, it is disappointed that the suspension has taken over 6-months.

[ZNBC 24/06/16]

43


MalawiPrices Pick Up As Quality Leaf Arrives At AuctionOfficials from auction floors say tobacco prices have now picked up after weeks of stormy sales following low prices and high rejection rate. The Tobacco Control Commission attributed the better tobacco prices to good leaf that has started arriving at auction floors. However burley is facing problems due to over production.

This year there are 9-tobacco buyers on the market down from 11 last year after Nyasa Manufacturers, sponsors of Nyasa Bullets pulled out of the market to concentrate on cigarette manufacturing along with an Egyptian company.

[Nyasa Times 08/06/16]

Leaf Rejection Rate Hits Record 90%Auction Holdings Limited noted the tobacco rejection rate at Mzuzu Auction Floors hit a record high of 93%. Whilst Auction Floors recorded an 86% rejection rate, Kanengo Auction Floor 77% while Chinkhoma in Kasungu had a 69% rejection rate. A meeting was held between the Tobacco Control Commission, buyers and representatives of farmers in a bid to improve the situation. The situation is knocking down the slow recovering economy in the process.


Farmers Request Government Permission To Sell Leaf AbroadFrustrated tobacco farmers at Limbe Auction Floors have asked the government to give them permission to sell sale their leaf abroad following the high rate of tobacco rejection rate at the market. Farmers are baffled with the high rejection rate of tobacco, calling it unprecedented. The unstable tobacco prices and the high rejection rate of tobacco are partly to blame for the shrinking and volatile economy.


ZimbabweTIMB To Test Run Electronic Auction SystemThe Tobacco Industry and Marketing Board [TIMB] is to undertake a test run for an electronic auction system at one of Zimbabwe’s tobacco floors before end of the season with full implementation expected in 2017. A new software programme is about 90% complete. TIMB contracted an Indian firm to automate the auction system in a move expected to reduce side marketing and illegal sales. Electronic auctioning is only done in India and Malawi. The rest of the tobacco farming countries use the contract system. In Zimbabwe, about 20% of tobacco is sold through the auction system.

[Herald 23/06/16]

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