IKURU

Bondens vei fra råvareleverandør til (del)eier

IKURU farmers: from commodity suppliers to ownership

A commodity trading business where the

producers are the owners

Mozambique in a nut shell

Mozambique is in southeast Africa, has

a total area of 801,590 km2

The coastline of the country, spans

2,470 kilometers along the entire eastern

frontier, borders the Indian Ocean.

Annual Gross Domestic Product (GDP)

growth rate 6,5%

Official language is PORTUGUESE

Main sector of employment: small scale

farming, agri processing (44% of GDP)

Increasing importance: industry (29% of

GDP), service (27% of GDP) mining and

soon oil and gas northern coast

2 min film from Norges Vels Mozambique program (Aftenposten TV 2014)

http://www.aftenposten.no/fakta/innsikt/Eventyr-i-FNs-and-7473015.html

IKURU today

• Is a Mozambican Agricultural commodity

and input trading company

• Registered as a Limited Company in 2003

(Cooperative structure not possible in

2003)

• We take our members’ produce to local,

regional and international markets

• Annual sales growth of 25%

• Annual trading volume increased by 20%

• 20,000 members - 40% women

• USD 1,300,000 annual turn over

Bakgrunn IKURU - Norges Vel i Mosambik

• Mosambik har et stort landbrukspotensiale - svakt organisert

• Kun 12% av landbruksarealet i produksjon

• Kun 50% av maten i Mosambik er egen produksjon

Langsiktighet skaper resultater - Norad støtten til Norges Vel gjennom 12 år la grunnlaget for cashew satsningen

• IKURU er nøkkelen til å nå bøndene i Nampula regionen

• Delvis bonde-eid bedrift som produserer såkorn

• Kjøper, renser, selger - markedsledd for bøndene

• 554 farmer associations

• Ny samvirkelov – Bønder må være organisert

• AMPCM skal løfte de 29 foraene til å bli aktive kooperativer frem til 2018 (Fora = IKURU eiere)

• IKURU er nå restrukturert og klar for ny vekst

• Egenkapital positiv – ny forretningsplan 2015-20

• Kapital til å kjøpe fra bonden er på plass

Bilde fra såkornrenseriet åpnet januar 2014

IKURU Shareholders 2014

Important note: Norges Vel is shareholder on behalf of the farmers and will transfer its

ownership in 3-5 years to functional coops and farmer organizations

Gapi 44 %

Norges Vel 44 %

28 Farmer Groups

12 %

% of shares

IKURU Services & Products

Purchasing

Processing

Packing

Certification

Seed production/

processing/ packing

Technical assistance

Input distribution (purchase

and re-sale)

Main crops:

Sesame

Peanuts

Cashew nuts

Beans

Soybeans

Cooperative Development Unit (will become an independent NGO in 2015)

• Design projects to assist the IKURU

member in improving productivity and

market access;

• Help associations build themselves

with strong cooperative principles;

• Provide capacity building trainings at

the farmers level;

• Link the Cooperatives with the

international e national market;

• Introduction of technology through

irrigation systems, mechanization and

good agriculture practices

(Conservation farming)

Trading Unit

• Buy grains from farmers

• Transport

• Sale locally and in the international

markets;

• Process (clean, pack and export)

• An average of 1000 tons are

processed and sold a year;

• Over 600,000 USD a year goes to

the hands of 5,000 farmers ;

• Capacity to clean and pack over

3000 tons per year

Seed Unit

• Seed production

• Contract with the seed producers;

• Sales of seed and other inputs

(fertilizers, mechanical tools)

• Seed certification

• Processing of seeds (cleaning,

treating and packing)

• Capacity to process 2000 tons of

seed per year

• Sales 250 tons of seed per year

benefiting directly and indirectly

over 10,000 farmers

Positive outlook for growth

0

200000

400000

600000

800000

1000000

1200000

1400000

2010 2011 2012 2013 2 014

887 000

1 400 000

554 316

760 000

1 300 000

Year

Sales in USD

The Cooperation goals of the CASHEW partnership is to address

clear market gaps and provide a ‘win-win’ scenario for all partners

Farmers

Receive an advance cash from IKURU

Supply quality Raw Cashew Nuts

IKURU/ Norges Vel

Purchases from the farmers process and exports

Brynild Gruppen (Norway)

Purchases from IKURU processes sales in

Scandanavia Market

Each partner brings unique value to Joint Company: goal to

transform cashew value chain, increase profits for all

14

• Increase volumes

sourced from

farmers and through

IKURU

• Increase income,

ensure long-term

consistency,

improve livelihoods

• New volumes

increase processing

potential

• Leverage investment

to increase capacity

• Improve margins

through higher end

prices

• BG secures long-

term, high-quality

supply, improves

product branding

in Europe

• Additional Euro-

based marketing

entity to ensure

price premium and

effective sales of

increased volumes

• Norfund

receives

financial and

social returns

through

investment

• Norges Vel

enables wide

social

improvements

in Mozambique

Production Processing Marketing &

buying Equity & support

Pa

rtn

ers

O

pp

ort

un

itie

s

1 2 3

Farmers Coops

4

Additional

regional nut

company?

Brynild Gruppen Role

15

Second-level processing at existing

state-of-the-art facility in Norway

• Process near target markets to

minimizes shelf-life risks & shipping

constraints

• For every KG of cashew kernel

purchased from IKURU, BG gives

an additional 0.35 USD to be

converted as a development fund

• The kernels are sold in

Scandinavian markets with the

origin of the kernels stamp on the

bags

1

2 Cashew raw kernels

Cashew nuts in bag

Use of the development Fund

16

New crop varieties

• Introduce new variety of higher yielding

cashew trees to farmer

• Train farmers on maintaining new

cashew tree variety to produce up to

12 kg/tree

Tree health

• Facilitate farmers’ access to seedlings

to replenish aged trees

• Train farmers to correctly spray crops

to boost tree health & longevity

Build strong Coops

• With members of IKURU network

…leading to long-term benefits for JC IKURU invests in farmers today…

1

2

3

1

2

3

Facilitate

IKURU

growth

Capacity

building

Technical

expertise

Treplanting – Kinderegget vi har sett etter…

17

Nye trær nødvendig

• INCAJU forsker på cashew i Nampula

• Nye cashew trær produserer opp til 12

kg per tre + epler

Vedlikehold

• “Unge” trær må beskjæres

• Gamle trær må erstattes

• Med rette insentiver vil bønder ta vare

på og plante mer

Bygge sterke cashew Kooperativer

• IKURU har 20 000 bønder i nettverket

• Et massivt treplanting program kan

starte med IKURU men inkludere alle

Treplanting i Nampula Bygge kapasitet hos bønder (organisering)

1

2

3

1

2

3

Co2 binding

Økte inntekter til

bøndene

Gjennoppbygnig

av en sektor -

store eksport

inntekter

18

Cashew from Mozambique is taking

lead in the new natural nut category

of Norwegian market leader

The Joint Company’s goal is to address clear market gaps and

provide a ‘win-win’ scenario for all partners

19

3

4

1 Global market has large demand for African cashews; offers higher prices

International markets offer premium pricing for African cashew, since current

demand is far below supply; trend expected to continue long-term

2 Mozambique production potential unmet, despite market size

Large potential for local production, but logistics are poor and yields are

multiples below other frontier markets (e.g. Vietnam)

Local processing is a bottleneck; requires patient long-term expansion capital

Condor requires investment to expand capacity and efficiency; could quickly

realize greater output, since production and market potential already exist

Local farmers need support; JC is opportunity to create sustainable impact

Opportunity to increase farmer income, inject assistance to support long-

term sustainable investment in livelihoods

5 Lack of transparency often stymies flows of development capital in to Africa

Free information flow across all interfaces between Joint Company entities

ensures full transparency and makes company more attractive to soft money