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AYOOLA OLUGA is the chief executive officer of Agrecourse, an agritech business that support smallholder farmers with finance. In this interview with JOSEPHINE OKOJIE, he spoke about how Agrecourse is reshaping the way people participate in farming and food production using their online platform to invest.
Can you tell us about Agrecourse and how it operates?
Agrecourse is a digital alternative investment platform that gives everyone the opportunity to partake in agribusiness, by financing any of our farms and trading agricultural commodities. At Agrecourse, we partner with financiers who are willing and able to provide smallholder farmers with the funds they need to improve their farm operations, thereby empowering these farmers, increasing their incomes, livelihood and enhancing food production. Agrecourse typically provides the farmers with technical support and quality inputs for production. We monitor the entire process and train the farmers to engage in best practices during production. After harvest, Agrecourse sells these commodities to agro-allied firms and share the profits with the farmers and the financiers.
Presently, we farm rice, maize, fish and poultry. The choice of commodities we produce is mainly informed by the availability of market. In essence, we provide our farmers with access to finance and markets. Although, Agrecourse was established in September 2018, we opened our first farm in November 2018.
As of today, we have raised just under $1 million from 745 financiers through our website. Since inception, we have reared about 45,000 birds and 550,000 fish. As a pilot, we have also cultivated a total of 543 hectares of maize and rice.
How is Agrecourse supporting farmers with finance and how many of them have been empowered?
Our mission as a company is to aid the transition of smallholder farmers from subsistence to commercial farming, through the support of our financiers, thereby achieving food security and economic growth. Agrecourse uses the funds raised from financiers to provide the farmers with quality inputs. We make sure that the inputs provided to the farmers will help them achieve maximum output when best practices are applied.
Agrecourse has successfully empowered over 700 smallholder farmers across 6 states -Ogun, Kwara, Rivers, Kano, Jigawa and Kaduna and the FCT.
What is the least rate of return on investment on any of your farms?
Presently, our least return on investment is 20percent for our fish and poultry farms that run for 6 months. We offer higher returns for longer investment periods.
What mechanism do you have in place in selecting the farmers that Agrecourse work with?
We have certain criteria that farmers must meet before they can qualify to work with us. For crop farmers, you must belong to a registered cooperative or association. This way, the body can identify and vouch for each farmer; and farmers can cross guarantee one another. The body must also be producers of the crop that we deal in, amongst other things. For livestock farmers, we look out for farmers that cannot meet the demand for what they currently produce. Unfortunately, we do not cater for new farmers at this time but we have plans to train and work with them, subsequently. You must have operated your farm and understood the business for some time before we can work with you. This way, we would not be putting our financiers’ money at the mercy of inexperienced farmers.
With the high rate of insecurity and kidnapping on the farmland, how do you secure investors investments on your farms?
All our farms are usually insured by Leadway Assurance. Also, we are currently working with Leadway Assurance for Accident and Life insurance for all our farmers and extension agents.
For the safety of the commodities – crops and livestock; our extension agents monitor the activities of the farmers from the beginning to the end of the farming cycle. We do everything within our power to prevent mistakes that could cost us. As a proactive measure, we completely avoid working in communities that are either known for violence or prone to violence. Before we engage with farmers in any community, we do our due diligence to make sure we can operate in that area.
Agrecourse is a year old. Can you tell us some of your expansion plans?
Presently, we are struggling to meet up with the demand for fish and we see that as a good problem. In the next few months, we are ramping up production by stocking at least 300,000 fish monthly. By mid-2020, we envisage we would have started stocking about 500,000 monthly to meet the growing demand for fish.
For poultry, we plan to commence processing in the first quarter of 2020, all things being equal. We have identified a gap in the poultry value chain and we are stepping up to fill that gap. We currently have several poultry farmers who claim that they do not have markets for their poultry, yet we discovered from our research, that most of these farmers actually cannot meet the regular demand- in terms of quality and quantity of large off-takers. We plan to bridge the gap by off-taking from poultry farmers and providing neatly-dressed chicken in the right quantities to off-takers. It is worthy of note that in 2018, the total demand for poultry in Nigeria was 200 million birds and there was a shortfall of about 60 million birds.
As regards crops, we plan to empower more farmers in the coming months. We are also looking beyond just rice and maize. We are considering soybeans, wheat and ginger as we have had different off-takers request for these. We will also be engaging in a lot of commodity trading, both locally and internationally.
Why are youth not finding agric attractive and what can the government do to change that?
Hitherto, most youth saw agriculture as something meant for the poor, and I really do not blame them. Majority of the farmers that engaged in agriculture saw it as a family tradition, rather than as a sustainable business so, it never looked attractive. Now, the narrative is changing. In the last 5 years, we have seen more youth get into agribusiness than in the history of this country. Innovations and technology like what Agrecourse is doing have further made it easier for youth to get into agribusiness without going to the farm. As for the government, they just need to create a conducive environment for agribusinesses to thrive.
How can the government address the challenges in the agricultural sector?
In my opinion, the government should encourage the adoption and application of innovations to agriculture so as to make the sector more competitive and sustainable. If improved systems are introduced, food production may just keep pace with the population growth we are experiencing, thereby ensuring food security. The government needs to make policies that will discourage importation (like the recent one where the CBN has been banned from providing FOREX to food importing companies) and encourage exportation.
