By Victor Okoye

A whopping +600 billion (USD) worth of food is lost yearly during and/or post harvest according to Mckinsey and Company. As alarming as this number sounds, it will keep trending upward if nothing is done immediately, factoring recent global misfortunes like the covid19 pandemic, the war in Ukraine and adverse effects of climate change. Most of this loss occurs upstream of the value chain – between the farm and point of food processing.

 It is a more sobering read when we focus on developing countries, especially countries in Africa.  With focus on Africa as regards threat to food security, it is only rational to bring to the fore its most   populous country – Nigeria.   

Nigeria has challenges peculiar to its agricultural sector further limiting its peoples’ access to food. These challenges range from transient ones like insecurity   in some northern parts of the country to   more existential ones like enormous population growth but there are three challenges in particular that if tackled, can significantly change the food supply situation:

1. Procurement: willingness to pay (WTP) in behavioral economics is the maximum price a consumer will pay for a product or service. Have in mind that the consumer ideally would rather pay less than high for a product but this notion gets misplaced when it comes to purchase of agricultural produce because not enough consumers are involvedin the process of agricultural   produce purchase at harvest, therefore   creating  a procurement deficit in the  sector.  This deficit not only causes food loss, resulting  in scarcity and leading to high cost of food but also serves as a disincentive to engage actively in farming for the farmers. Capital for food is relatively available and affordable from   financial institutions in developed countries but the opposite is the case in developing countries so an alternative  means of capital for food must be devised to tackle the problem of procurement deficit at harvest in the agricultural sector. One hopeful silver bullet to this problem is democratizing food in Africa by encouraging everyone to participate in the procurement of produce at farm gates to help maximize farmer’s yield thereby increasing the volume of food released into the open market and also serve as a financial incentive to the farmers to want to farm more. The way Africans buy food needs to change completely. The consumer now needs to think like the producer by embedding themselves in the earlier part of the value chain – upstream -between the farm and processing.

2. Storage: Whenever storage is   mentioned in Africa, it immediately   sounds like  an impossible achievement   and this is because the thought process  has always been around capital intensive massive underutilized warehouses located on the outskirts of cities, or in coastal cities for the purpose of export. Adequate storage is out of reach for domestic agro players. The thinking around storage in Africa needs  to  change, consideration  needs to be given to varied storage units including compact storage, mobile storage and most importantly neighborhood storage units – using existing shops and supermarkets as proof of concept because by definition, shops and supermarkets already serve the purpose of storage. 

So instead of constantly trying to build new 1,500 square meter warehouses, we can utilize 10 already existing 150 square meter houses that will be affordable, fully utilized and located within densely populated areas giving consumers quicker access to food. 

3. Demand and supply forecast: Finally, big data using basic key metrics like near future demand for agricultural produce and projected future yield at harvest on the supply end will change the game tremendously in how Africa plans for food security. This will involve active engagement of supply (farmers) and demand (consumers) on what their capacity and needs are respectively. With this done over a few years, Africa will confidently be able to tell what output of particular crops for the next year will be and what the demand will be and quickly ascertain whether there will be a surplus or deficit, then plan accordingly. We have seen significant movement in Africa around agriculture with some agritech firms like Afex, Babban Gona and ThriveAgric doing some interesting work. However one exciting and innovative agritech company – AGRIHOLDERS (agriholders) powered by CrowdpinchStorage (crowdpinch) currently checks two out of the three points discussed above with emphasis on distributed storage as a dark store for agri produce. 

Agriholders is an agritech company disrupting the paradigm of agricultural practice in Africa by democratizing food. Their goal as they say is to give everyone an opportunity to play in the upstream value chain of agriculture by letting people BUY.STORE.SELL. It is such a holistic approach that speaks to the problem of procurement by connecting people to farmers to buy directly at farm gate prices and provide storage for both the farmers and the primary buyers ofthe produce if need be to avoid food loss on both ends. Speaking with one of the company representatives,  Mr. Idoko said the short and mid term goals are to solve   the problems of procurement at harvest and storage in the agricultural sector then take on the demand/supply data challenge long term. 

Currently he said the company has a network of over 300,000 farmers across Nigeria alone who are now being connected to the world by creating a marketplace for them where corporates, manufacturers, SMEs and individuals can buy directly from them and take delivery like a typical e-commerce purchase thereby closing the procurement deficit   at harvest for farmers. On storage, he said they treat every storage unit as a “Dark Store” – a shop that can sell toconsumers  without interfacing with them physically. He believes the future of food in  Africa requires innovative initiatives that do not conform to the norm.  The company  currently has+20,000 square meter storage space aggregated across Nigeria dedicated to food security. 

We must admit that Agriholders is taking some bold steps in proffering solutions to food insecurity in Africa and we look forward to seeing their future achievements in the sector. You can keep tabs on their project on food security in Africa at agriholders.

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