September 30, 2013

 

In an aim to target more than US$1 billion in sales of its seed and crop-protection products, Syngenta is planning to invest US$500 million in African agriculture over the next decade.

 

Mike Mack, Chief Executive Officer of Syngenta International, said that the "cumulative investments" in Africa would include recruitment and training of more than "700 employees with a high level of agronomic specialisation."

 

To enable productivity gains of 50% or more while preserving the long-term potential of the land, the company was targeting more than five-million African farmers as customers over the 10 years.

 

Africa has almost 50% of the world's unused arable land and a potential for vastly increased productivity. These have caused it to be increasingly viewed as a breadbasket for a global population that is projected to reach more than nine-billion by 2050.

 

Productivity rises are expected from a modern technological revolution in Africa and genetic modification (GM) of seeds that enable greater crop yields. GM crops have been slow to gain acceptance in Africa but an increasing number of countries are conducting trials and growing limited amounts of crops. South Africa is the continent's leader in GM technology, cultivating by far the greatest amount of crops.

 

Syngenta's move follows that of multinational agribusiness DuPont Pioneer that earlier this year bought 80% of South African seed company Pannar in what it described as its "biggest investment in Africa". Agricultural leaders then predicted that more investments by multinationals in Africa would follow.

 

Syngenta, the biggest agribusiness in the world and the third biggest in commercial seeds, employs 27,000 people in about 90 countries. Mack said there were many millions of "pre-commercial" smallholder farmers in Africa, but Syngenta did not view the consolidation of small farms into bigger entities as "either desirable or necessary".

 

The argument that only big commercial farms could employ economies of scale did not take into account the role that business could play in providing services for small farmers. "Private enterprise must respond to the needs of small farmers," Mack said.

AgriSA president Johannes Möller welcomed Syngenta's undertaking to invest in African agriculture. "Africa has about 700-million of the one billion food-insecure people in the world, yet it has most of the production capacity in terms of unused arable land. The production of biofuel, for example, could provide a huge boost for African economies."

 

Möller agreed with Mack that smallholder farmers were important. "About 60% of agricultural products in the world are produced by smallholder farmers, using new technology," he said.

 

Omri van Zyl, agriculture industry leader at services company Deloitte, said helping small-scale farmers could advance food security on the continent. The help could be in form of provision of enhanced storage facilities and negotiating better terms of trade in Africa and with major trading partners.