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Food security challenge: From Kwara, a lifeline model

By Mike Ebonugwo

When in the year 2000, President Robert Mugabe of Zimbabwe sent White farmers in his country packing from their farms following a bitter, long-drawn dispute over land ownership, many were left wondering what would become of the displaced farmers and the implication for the Zimbabwean economy. Before the development, the White farmers were considered key stakeholders in a strong and viable Zimbabwean project given the fact that agriculture which the farmers had succeeded in developing into a thriving venture was a major stay of the country’s economy.

L-R: Emefiele, Saraki, Gov Ahmed and Allen during the CBN Governor’s visit to Shonga Farms, Edu, Kwara State

The displaced Zimbabwean White farmers were left with no choice but to seek for new base elsewhere to apply and employ their agricultural skills.

Some of them did not have long to search as the then Governor of Kwara State in Nigeria, Dr Bukola Saraki who is currently the president of the Nigerian Senate, saw in their plight an opportunity to actualise a long-nursed dream: to revitalise the agricultural sector in Kwara State and make his beloved state the agricultural hub of North Central Nigeria, and indeed the entire country, under the auspices of a Back-to-Farm Project instituted to encourage commercial agriculture in the state.

It all began in 2005 when he invited 13 of the displaced White farmers to Kwara State, and after a session of discussion and negotiation, what came to be known as Shonga Farms Holdings Ltd, SFH, was born in Edu Local Government Area of the state.

According to Abdulwahaab Oba, the Chief Press Secretary of the current governor, Dr Abdulfatah Ahmed: “Following due process, Kwara State government acquired 13,000 hectares of land with additional 1,000 hectares as demonstration farm and another 2,000 hectares in Fiagi for community development after compensation was agreed and paid to the local land owners.

“Each of the 13 farmers was allocated 1,000 hectares (on leasehold interest for 25 years) under distinct and separate companies duly registered in Nigeria. The Kwara State Government granted the sum of $250,000 to each farmer as loan as a result of their deprived and desperate situation when they arrived Nigeria. This money was applied for opening up of barren lands, cultivation, working capital, acquisition of plants and machinery, private residence and warehouse, among others. This grant was converted to equity of 25% shareholding after the registration of Shonga Farms Holding.”

Oba added that five partner banks, namely Guaranty Trust Bank, GTB; First City Monument Bank, FCMB; Fin Bank; Unity Bank; Keystone Bank (Legacy Bank PHB) and Access Bank through Legacy Intercontinental Bank which packaged the funding of the farms hold 75% shares of SFH at 15% each. Though the Kwara State Government and the five banks are by this arrangement the owner of SFH, the company is regarded as an independent entity, separate from the state government. Allen Jack, who is the leaders of the expatriate farmers, said they found the arrangement quite suitable as it helped to remove needless bureaucracy or politics. “We have completely avoided the issue of politics. The SFH surpasses politics; we are dealt with purely on professional grounds.”

Speaking on the state government role in the project, the general manager of the farm, Mr. Bayo Sangobiyi, was quoted as explaining thus: “As at the time Shonga farms was registered, the Kwara State government had invested in the project by clearing the lands, opening up of roads, light and others”.

The good news is that not long after the project came into being and after surviving some teething problems, it is today being celebrated as a success story. According to Sangobiyi: “The journey had been very strenuous and not too pleasant at the beginning because the owners of the land were very reluctant to release the land which delayed our settling down. In the first two years of the project, it was at a snail speed but then the farm was like a department under the state Ministry of Agriculture, supervised by a Director.

“We started experiencing progress when the farm became a full fledge limited liability company and since then it has been one success story after another”.  It was able to achieve this through a three-way syndicated process structurally tagged Mixed Crop Syndicate, Poultry Syndicate and Dairy Syndicate. It was under this arrangement that the farm has been producing commercial crops such as maize, rice, cassava, ginger, soya bean, milk and poultry meat. The Poultry Syndicate, Vanguard Features was told, has the capacity to raise 160,000 birds on weekly basis or 12 million broiler chickens per annum. Apart from that, it is said to have a fully automated modern abattoir with installed capacity of 10,000 birds per day, although it currently dresses 5,000 birds daily.

Speaking further on this, Sangobiyi said: “Averagely, every section is involved in cropping because it is like a general responsibility for all of them. What we are doing is backward integration; the poultry and the dairy sections plant their own crops. They plant their maize, soya beans, millet and everything. They process them into feeds for the chickens while the dairy section also plants its own silage”.    It is also said that the farm under its Dairy Syndicate operation has the capacity to process up to 50,000 litres of milk per day. Although the farm’s primary focus is serving the local market in Kwara State, it supplies 2500 litres of raw milk daily to West African Milk Company, WAMCO, producers of Peak Milk. The poultry farm is said to supply chicken to the popular fast food company, Kentucky Fried Chicken, KFC, in Lagos. In the same vein, several retail stores also rely on the farm for varying farm produce supplies. Remarkably, the success of SFH is said to have prompted the Federal Government to use it as a demonstration farm for the purpose of raising high quality cassava stems and to train local farmers for high quality cassava production. The experiment is believed to have achieved its objective as many multinational companies are now either sourcing their cassava requirement from Kwara State or making direct investment on cassava in the state. In addition, Oba said: “It is on record that Shonga Farms is the first Nigerian company to have successfully exported high quality Cassava chips to China and Israel. Nigeria Starch Mill in Anambra State and Thia Farm and subsidiary of Nigeria Flour Mills are at present sourcing their Cassava needs from Shonga”.

But beyond its primary areas of production activities, SFH is already expanding its scope and reaping the benefits in terms of its operational objectives. According to Sangobiyi: “Apart from the poultry, dairy and planting activities, the farm also engages in research and development in the areas of breeding and genetics and there are plans to develop adaptable cattle to the farm environment.  The farm is also partnering with a lot of seed companies in the USA and Brazil on the supply of maize and soya beans respectively. It also supplies banana to Shoprite in Ilorin.   “The farm presently employs between 4500 and 6000 workers for both off and peak periods but with the on-going expansion, the poultry section alone has 2000 workers at off and peak periods, which is expected to increase to about 10000 workers when the expansion is completed’’.

The success story of the farm and its positive implication for the Nigerian economy obviously has not escaped relevant officials of the Federal Government. For instance, during a recent working visit to the farm, a highly impressed Governor of Central Bank of Nigeria, CBN, Godwin Emefiele, had announced that the apex bank intention to support the foreign investment in the poultry syndicate of SFH with a loan of N2billion under the Commercial Agricultural Credit Scheme.  Commending the Kwara State government for the Shonga farms initiative which in his estimation has successfully promoted agro-allied business in Nigeria, he said the loan will attract only a single digit interest rate of 9%.

Emefiele, who was accompanied during the visit to Shonga Farms by the Senate President, Dr. Bukola Saraki, Kwara State Governor, Alhaji Abdulfatah Ahmed and some members of the Senate, praised the State government for its initiative which he said is worthy of emulation by other states of the federation, to serve as commercial agriculture model   in diversifying the economy. He said Shonga Farms was a practical example of how governments can collaborate with the private sector to deliver real dividends of democracy such as jobs and agro-allied prosperity.was particularly impressed with the poultry section of the farm owned and managed by Valentine Farms, and praised it for providing employment to many unemployed youths in the state.

Thanking the CBN Governor for his gesture and Governor Ahmed for sustaining the SFH initiative, the Senate President pledged the National Assembly’s continued support for agro-allied businesses in the country through appropriate laws.

In his response, Governor Ahmed thanked the CBN Governor for the loan and and the Senate President for his pioneering efforts on Shonga Farms which he said had huge potentials, adding that the challenge “is how to put together a programme under the Off-taker demand driven Agricultural Scheme to exploit the potentials fully”.

 


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