PUBLIC PRIVATE PARTNERSHIP FOOD SECURITY VIA VERTICAL INTEGRATION OF A NEW KENYAN POTATO CHAIN AGRIPRO WORKSHOP
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1 PUBLIC PRIVATE PARTNERSHIP FOOD SECURITY VIA VERTICAL INTEGRATION OF A NEW KENYAN POTATO CHAIN AGRIPRO WORKSHOP
2 GOALS, SPIN OFF & PARTNERS Goals & spin off GOALS CREATE THE FIRST VERTICALLY INTEGRATED KENYAN POTATO VALUE CHAIN THAT PRODUCES 143,000 TONNES OF CONSUMER POTATO PER YEAR IN KENYA; ESTABLISH A POTATO ENABLING ENVIRONMENT; PPP GOALS (PHASE I) REALISE POTATO KNOWLEDGE THROUGHOUT OUR ENTIRE CHAIN (OUT OF WHICH +/- 12,500 SMALL HOLDERS) BASED ON THESE TANGIBLE RESULTS, THE CURRENT RISK FOR PRIVATE INVESTORS WILL BE LOWERED. OTHERS WILL FOLLOW OUR EXAMPLE AND WILL ALSO INVEST IN KENYAN POTATO SECTOR. HENCE A NATURAL EVOLUTION INTO PHASE 2 FULLY REALISE KENYA S POTATO POLICY AND THIS ITS FOOD SECURITY GOAL REALISING A PROFITABLE CHAIN FOR ALL SMALL HOLDERS: AFTER PPP (PHASE II) REALISE A JOB GROWTH OF 50% IN RURAL AREAS (AROUND 400,000 JOBS); BOOST THE POTATO TURNOVER AND YIELDS AT SMALL HOLDERS UP TO 950% RESP. 550% 5 TIMES LESS WATER AND 5 TIMES LESS LAND WILL BE NEEDED TO REALISE THE SAME AMOUNT OF POTATO 2
3 PPP CHAIN Partners & 3rd Parties LACHLAN KENYAN MINISTRY OF AGRICULTURE, LIVESTOCK AND FISHERY + COUNTIES KEPHIS BAYER CROPSCIENCE YARA KARI NL MINISTRY OF ECONOMIC AFFAIRS, AGRICULTURE AND INNOVATION LARGE FARMERS NL MINISTRY OF FOREIGN AFFAIRS INDEPENDENT SMALL HOLDERS NAK SMALL HOLDERS IN CO- OPERATIVES IFDC MIEDEMA SNV TOLSMA FPEAK MURPHY & OTHERS POTATO BUSINESS SCHOOL AGRICO NL PTC THIKA AGRICO EAST AFRICA POTATO SEED AFRICA (JV) ATRADIUS RABOBANK 3 MIGOTIYO PLANTATIONS LTD
4 CONTENT + KEY FIGURES PPP 4 main topics MAIN TOPICS IN OUR PPP 1. REALISATION POTATO CHAIN 2. KNOWLEDGE IN CHAIN 3. REALISATION POTATO ENABLING ENVIRONMENT 4. KENYA INCLUDED IN R&D TESTING CYCLE MANAGER AEA MANAGER SERVICE CENTER MANAGER NL EMBASSY MANAGER AGRICO 4
5 RESTAU- RANTS AGRICO NL MPL (MULTIPLIER) PSA (JV SERVICE CENTER) AEA SUPERMARKETS KENYAN CONSUMERS CLASSICAL MARKETS 1. ADDED VALUE PER CHAIN PARTNER Overview potato flows (existing + new) DISTRI- BUTORS INDEPENDENT SMALL HOLDERS MIDDLE- MEN CO-OPERATING SMALL HOLDERS (CO-OPERATIVES + COUNTIES) PRE- PACKING INDUSTRY LARGE CONSUMER / WARE POTATO FARMERS POTATO PROCESSING INDUSTRY Potato flow via independent small holders and middlemen (existing) Potato flow via commercial villages & co-operating small holders (new) Potato flow via large consumer / ware potato farmers (new)
6 1. REALISATION PROFITABLE CHAIN : JV Investments storage (3,200 tonnes per growing season) 6
7 1. REALISATION PROFITABLE CHAIN : JV Investments potato machinery 7
8 1. REALISATION PROFITABLE CHAIN Key figures KEY FIGURES PER YEAR INPUT FROM THE NETHERLANDS (TONNES) MULTIPLIED POTATO IN KENYA (TONNES) PRODUCED CONSUMER POTATO IN KENYA (TONNES) , , % KENYAN POTATO CHAIN
9 1. REALISATION PROFITABLE CHAIN Investments (in mio) HARDWARE INVESTMENTS (CAPEX) SERVICE CENTERS CO-OPERATIVES / SMALL HOLDERS FUTURE LARGE POTATO FARMERS TOTAL & INVESTMENTS IN WORKING CAPITAL VALUE CHAIN INVESTMENTS IN KNOWLEDGE TRANSFER INVESTMENTS IN CAPACITY BUILDING KENYAN + DUTCH PUBLIC INVESTMENTS
10 CONTENT + KEY FIGURES PPP 4 main topics MAIN TOPICS IN OUR PPP 1. REALISATION POTATO CHAIN 2. KNOWLEDGE IN CHAIN 3. REALISATION POTATO ENABLING ENVIRONMENT 4. KENYA INCLUDED IN R&D TESTING CYCLE MANAGER AEA MANAGER SERVICE CENTER MANAGER NL EMBASSY MANAGER AGRICO 10
11 2. ENABLING ENVIRONMENT Topics public partners a) LEGISLATION 4. DOUBLE 1. PACKAGING 2. TAXATION / 3. LATEST GOAL REGI- 5. SCOPE NPT SIZES ROAD BLOCKS UPOV RULES STRATION TRIALS SYSTEM b) ANTI ILLEGAL MULTIPLICATION c) CAPACITY KEPHIS d) RURAL INFRASTRUCTURE
12 2. ENABLING ENVIRONMENT Result a) LEGISLATION 4. DOUBLE 1. PACKAGING 2. TAXATION / 3. LATEST GOAL REGI- 5. SCOPE NPT SIZES ROAD BLOCKS UPOV RULES STRATION TRIALS SYSTEM b) ANTI ILLEGAL MULTIPLICATION c) CAPACITY KEPHIS LOWER THE CURRENT RISK FOR PRIVATE INVESTMENTS IN KENYAN POTATO CHAIN, INVESTMENTS WILL FOLLOW
13 2. ENABLING ENVIRONMENT Result a) LEGISLATION 4. DOUBLE 1. PACKAGING 2. TAXATION / 3. LATEST GOAL REGI- 5. SCOPE NPT SIZES ROAD BLOCKS UPOV RULES STRATION TRIALS SYSTEM b) ANTI ILLEGAL MULTIPLICATION c) CAPACITY KEPHIS LOWER THE CURRENT RISK FOR PRIVATE INVESTMENTS IN KENYAN POTATO CHAIN, INVESTMENTS WILL FOLLOW
14 CONTENT + KEY FIGURES PPP 4 main topics MAIN TOPICS IN OUR PPP 1. REALISATION POTATO CHAIN 2. KNOWLEDGE IN CHAIN 3. REALISATION POTATO ENABLING ENVIRONMENT 4. KENYA INCLUDED IN R&D TESTING CYCLE MANAGER AEA MANAGER SERVICE CENTER MANAGER NL EMBASSY MANAGER AGRICO 14
15 3. KNOWLEDGE TRANSFER Private, public & NGO partners TOPICS MULTI- PLIER INDEP. SMALL HOLDER CO-OP. SMALL HOLDER Know how Do how Know how Do how Know how Do how SEED & CONSUMER (WARE) POTATO GROWING MULTIPLICATON / SELECTION FERTILISATION PLANTING & HARVESTING SORTING POTATO LOGISTICS STORING PACKING TRANSPORTING FINANCE MARKETING POTATO BUSINESS SALES GENERAL MANAGEMENT CREATING AWARENESS AGRICO NL + AGRICO EAST AFRICA POTATO BUSINESS SCHOOL (AGRICO, TOLSMA, MIEDEMA + OTHERS) SERVICE CENTER MANAGEMENT PTC THIKA IFDC 15
16 3. KNOWLEDGE TRANSFER Private, public & NGO partners TOPICS MULTI- PLIER INDEP. SMALL HOLDER CO-OP. SMALL HOLDER Know how Do how Know how Do how Know how Do how SEED & CONSUMER (WARE) POTATO GROWING MULTIPLICATON / SELECTION FERTILISATION PLANTING & HARVESTING SORTING POTATO LOGISTICS STORING PACKING TRANSPORTING FINANCE MARKETING POTATO BUSINESS SALES GENERAL MANAGEMENT CREATING AWARENESS AGRICO NL + AGRICO EAST AFRICA POTATO BUSINESS SCHOOL (AGRICO, TOLSMA, MIEDEMA + OTHERS) SERVICE CENTER MANAGEMENT PTC THIKA IFDC 16
17 CONTENT + KEY FIGURES PPP 4 main topics MAIN TOPICS IN OUR PPP 1. REALISATION POTATO CHAIN 2. KNOWLEDGE IN CHAIN 3. REALISATION POTATO ENABLING ENVIRONMENT 4. KENYA INCLUDED IN R&D TESTING CYCLE MANAGER AEA MANAGER SERVICE CENTER MANAGER NL EMBASSY MANAGER AGRICO 17
18 4. KENYA IN AGRICO S R&D CYCLE In 2016 KENYA IN AGRICO S R&D CYCLE NEW VARIETIES EXPECT FOR KENYA S INCLUDED LARGE SCALE TESTING (FINAL 3 YEARS): TESTED ALL OVER THE WORLD EQUATOR BEST VARIETIES FOR REGION HAVING SHORT DAYS (12 HRS OF LIGHT PER DAY) DURING GROWING SEASON KENYA PART OF INTERGRAL BREEDING PROCESS WITHIN AGRICO 18
19 PLANNING PPP Status DURATION JANUARI 1ST 2015 : 7 YEARS : START OF PPP 19
20 2015 Realisation profitable potato chain 2015 MPL: START WITH FIRST KENYAN MULTIPLICATION; 1ST YEAR (2 GROWING SEASONS) BASED ON PROOF OF CONCEPT ; 1ST INVESTMENTS IN HARDWARE. 20
21 2015 Realisation profitable potato chain KICK OFF; 2015 STEP BY STEP + VARIOUS HURDLES (KEPHIS) 21
22 2015 Realisation profitable potato chain + knowledge transfer MAIN TOPICS SMALL HOLDER SHOWCASES SMALL HOLDER CONSUMER POTATO SHOWCASES AT 2 CO-OPERATIVES TRAIN THE TRAINER INFRASTRUCTURE (7 LOCATIONS) CASES (BUSINESS, SOCIAL + ENVIRONMENTAL) YIELD BOOST EXPERIENCED BY SMALL HOLDERS IN PRACTICE ON THEIR OWN LAND AND UNDER THEIR CONTROL 22
23 2015 Realisation profitable potato chain + knowledge transfer MAIN TOPICS SMALL HOLDER SHOWCASES SMALL HOLDER CONSUMER POTATO SHOWCASES AT 2 CO-OPERATIVES TRAIN THE TRAINER INFRASTRUCTURE (7 LOCATIONS) CASES (BUSINESS, SOCIAL + ENVIRONMENTAL) YIELD BOOST EXPERIENCED BY SMALL HOLDERS IN PRACTICE ON THEIR OWN LAND AND UNDER THEIR CONTROL 23
24 SOCIAL CASES Job creation 6,000 NEW JOBS CREATED ACTIVITIES Due to top quality input material, knowledge transfer and small holder automation, potato yields per Ha will grow from a current 6 tonnes per Ha to 27 tonnes per Ha (for independent small holders) and to 30 tonnes per Ha (for small holders that collaborate in a co-operative). As a result of this efficiency boost, the amount of jobs at small holders will also grow. We structured the type of jobs in two categories, namely potato growing and potato logistics POTATO GROWING Potato growing includes activities such as planting, harvesting and fertilisation. We foresee the largest growth in jobs at harvesting (twice a year) and to a lesser extend at growing (realisation of planting beds). POTATO LOGISTICS TOTAL IMPACT Potato logistics includes activities such as sorting, storing, packing and transporting. A growth in all such logistical activities is foreseen. Taken the two growing seasons per year, we expect to realise at least a job creation of 50% at the small holders (6,000+ jobs), out of which at least 60% women. 24
25 ENVIRONMENT + CLIMATE CASES (i) Efficiency improvement ELEMENTS 5 TIMES LESS LAND + 5 TIMES LESS WATER + 2 TIMES LESS FERTILIZER FOR SAME AMOUNT OF POTATO Due to top quality input material, knowledge transfer and small holder automation, potato yields per Ha will grow from a current 6 tonnes per Ha to 27 tonnes per Ha (independent small holders) and to 30 tonnes per Ha (for small holders that collaborate in a co-operative). INTRINSIC This automatically results in efficiency improvements for the environment too: to realise a similar amount of potato (kgs), we need up to 5 times less land and 5 times less water. Moreover potato is the crop that from all possible crops - that provides the highest nutrition value for the smallest amount of water and the smallest amount of land needed. We will also introduce effective crop rotation programs, that will improve the quality of the soil over the years. ADDITIONAL Moreover we will introduce the concept of potato beds. As a result less water is needed too Finally we intend to optimise the use of fertilizers at small holders. We also foresee an optimised use of fertilizers, and for a similar yield of potato we expect to use 2 times less fertilizer. 25
26 ENVIRONMENT + CLIMATE CASES (ii) Potato improvement ELEMENTS 90% REDUCTION OF DISEASES / VIRUSES DISEASES / VIRUSES Currently it is estimated that 80% to 90% of all potatoes in Kenya suffer from viruses and diseases. We expect that by using our input material at co-operatives we will lower this to 5%. NUTRITION VALUE INCREASE The current Kenyan potato cooking varieties having 12%-15% of dry matter content and as a result a low level of starch. We will also introduce fresh potato varieties having 20%-25% of dry matter content and as a result a higher level of starch. Measurement of such varieties will be realised via realised placements on the variety lists and presence of such varieties in our demo fields. 26
27 MAIN TOPICS IN CASES Inclusive, environment, social 4 MAIN TOPICS BASELINE STUDIES Measurement starting situation IMPACT CASES Measurement progress 1. INCLUSIVE BUSINESS CASES CO-OP SMALL HOLDERS 2. ENVIRONMENTAL + CLIMATE CASES CO-OP SMALL HOLDERS 3. SOCIAL CASES CO-OP SMALL HOLDERS Measurement of actual business case, based on small holder business model from prospectus (yield, price, cost, profit etc.) Goal : 940% growth in turnover + 550% growth in profit for co-op. small holders Goal intrinsic measurement: lowering of land and water and fertilizer need per kg potato by factor 4 / 5 for co-op. small holders Goal intrinsic measurement + optimisation: lowering of fertilizer need per kg potato by factor 2 for co-op small holders Soil improvement measurement (by CROPNUTS = Crop Nutrition Services and similar services) due to adoption of crop rotation Water efficiency measurement : adoption of potato bed Goal : measurement job creation of 3,000 people (>+60% female) Measurement well fare growth (business case, microfunding, cash flow etc. combined in one) Women participation measurement in small holder farming + knowledge transfer Ultimately measurement women empowerment (and similar women occupation level of 60%). 27
28 MAIN TOPICS IN CASES Inclusive, environment, social 4 MAIN TOPICS BASELINE STUDIES Measurement starting situation IMPACT CASES Measurement progress 1. INCLUSIVE BUSINESS CASES CO-OP SMALL HOLDERS 2. ENVIRONMENTAL + CLIMATE CASES CO-OP SMALL HOLDERS 3. SOCIAL CASES CO-OP SMALL HOLDERS Measurement of actual business case, based on small holder business model from prospectus (yield, price, cost, profit etc.) Goal : 940% growth in turnover + 550% growth in profit for co-op. small holders Goal intrinsic measurement: lowering of land and water and fertilizer need per kg potato by factor 4 / 5 for co-op. small holders Goal intrinsic measurement + optimisation: lowering of fertilizer need per kg potato by factor 2 for co-op small holders Soil improvement measurement (by CROPNUTS = Crop Nutrition Services and similar services) due to adoption of crop rotation Water efficiency measurement : adoption of potato bed Goal : measurement job creation of 3,000 people (>+60% female) Measurement well fare growth (business case, microfunding, cash flow etc. combined in one) Women participation measurement in small holder farming + knowledge transfer Ultimately measurement women empowerment (and similar women occupation level of 60%). 28
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