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Mechanisation, the Way out for Nigerian Agriculture
« on: May 07, 2013, 05:03:00 PM »
Managing Director, Dizengoff West Africa (Nigeria) Limited, Mr. Richard Hargrave, speaks about the enhancement of Nigeria’s agricultural productivity through mechanisation and a more scientific approach to farming. Crusoe Osagie provides excerpts

Dizengoff History in Africa

Dizengoff was established in Nigeria 1958, as part of Balton CP Ltd, a UK registered multinational conglomerate operating across sub-Saharan Africa. We are proud of our reputation for integrity, professionalism, reliability and innovation, and our ability to offer decades of global expertise twinned with unsurpassed knowledge of the Nigerian market. The company is focused in two fundamental areas, the public and principle sectors such as, telecommunications and radio communications sectors which is the public sector, while the principle clients face the oil and gas sector.

Then the other half of the company is the agricultural sector which focuses on integrated solutions, mechanisation, tractors implementations, agro-chemical, irrigation products, green housing and a lot of other solutions which are focused to achieve one mission, how to help farmers on sustainable basis to mark the increase yields of food sufficiency and this is our fundamental mission in Nigeria.

That is highly compatible with the transformation agenda initiative and policy of government of Nigeria. How do they solve situation in production of food requirement of the nation. There is a lot of importation of food in Nigeria, which is why we see it necessary to help the country to achieve its aim.

Importation of fake mechanised tractor into Nigeria

It became a pain to us that the said tractors are bearing the trade mark of Massey Ferguson, which is a trade mark designed by AGCO, the world largest manufacturers of tractors. We are the sole appointed importers, distributors and provider of services for the Massey Ferguson’s tractors in Nigeria. It is our responsibility to bring the right tractors into the country, the right sets to buy, to give the spare parts supports and the autos and services support. So, we are holding the structure designed to make sure that the right tractors are brought to Nigeria. The right tractor depends on the country you want to use it for, the soil, area and topography you are trying to use it for.

So, there is a special range of tractors specifically designed for each market in the world that meets the need of that market. These tractors that were imported were produced in Pakistan under a license granted by Massey Ferguson, but it is a Massey Ferguson produced tractor. It was produced by an independent company in Pakistan, they were specifically manufactured and to be used in Pakistan. From the clock ranges, the sole types, to the complete scenario, no parts within that tractor are Massey Ferguson parts. Massey Ferguson has no control or involvement in the production of that tractor.

Those tractors are not suitable in the market outside of Pakistan. The tractors are solely for Pakistan and such tractors sold in Pakistan must be produced by indigenous manufacturers. There is a limit for such tractors, because they are produced and used in Pakistan, they are not to be exported out of Pakistan. These are the kind of tractors that we have seen in a couple of states here in Nigeria, those tractors cannot work properly and they cannot find their spare parts, those tractors will fail and we do not want to see farmers in Nigeria with failed tractors. Nigeria is one of the least mechanised agriculture sector markets in the world.

You will not achieve your aim to increase yours without the proper tools and equipment in your country. You need to have the right tractors, right ranges of implements, chemicals, technics and technologies, skills and the right solutions, if Nigeria is to achieve its aim of managing its security food and bring a suitable farming for farmers in all sectors of farming, be it small, middle and large scale farming.

It is absolutely imperative to Nigeria that they reduce the importation of basic foods. If you look at the whole of history, you will never see any country that does not supply its own basic foods. America was built on cotton and wheat with its entire wealth, industrial infrastructure, and military framework was built with highly productive wheat and cotton. During the Second World War, Britain had the master plan and they formed the European community and they fundamentally focused on providing food for the people. The Agricultural Policy of the European Union, and it was only after they did that that they could build factories, provide employment and they built their economic system. You cannot build a nation without building food.

Impact of sub-standard tractors on farming mechanisation in Nigeria

If you import tractors that are not suitable for the lands here, first the farmer will produce at a very high mechanisation cost, because he is going to have breakdowns, buy spare parts and have down time. He is going to incur a lot of expenses beyond his budget, and therefore he will fail. Second, most of those tractors cannot really be used by farmers because the hiring agency that will give the tractor to the farmers might not have them because of breakdown and they will not be available for small and medium scale farmers and this in itself is pulling down agricultural mechanisation, which should actually be improving for us to have sufficient food production.

In Nigeria, you have a lot more rain and the soil is going to be heavier and you need a tractor that has light tyre, light gears if not the tractor will not work, rather it will break down. If this happens there will be no technical tool available for the farmer. I can take you round this country and I can point out 2,000 of these tractors imported into this country, one week old and never used. They come from China, India, Pakistan and they do not work. They are not made for the conditions here.

Check-mating influx of sub-standard tractors and farming equipment

It is not left for Dizengoff to be managing the importation of such equipment, because we do not control what comes across the borders of this country, sub-standard equipment and dumping of long produced goods. That is not our work, government agencies should do that. What we can do is educate the farmers, buyers and market according to their needs the type of tractors they will be using. What we can do is to make sure that we provide those tractors, to make sure that the tractor is properly working before we give it to a farmer, we do not release a tractor if we are not sure that the tractor is work-ready for the farmer. In Dizengoff we provide agricultural services, we train technicians; we provide the service and support of taking care of tractors for the farmers.

Tractors models provided by Dizengoff

We have in Dizengoff approved tractor models by AGCO, the manufacturers of Massey Ferguson contractors; in fact one common thing about the approved version is that they now have the word “Xtra” attached to them. MF 240 Xtra (2WD)- 46Hp, MF 275 Xtra (2WD)- 75Hp, MF 435 Xtra (2WD)- 72Hp, MF 440 Xtra (4WD)- 82Hp, MF 455 Xtra (4WD)- 100Hp, and MF 470 Xtra (4WD) - 120Hp; once you see the word Xtra attached to the figures in the MF then you will know that the tractor is the approved model and these are only available through Dizengoff. The tractors are made for the Nigerian condition, which is why they have Xtras on them. They are meant for heavy land conditions which are meant for very heavy soil types. Some of the tractors that exist here cannot be found in other countries, there are tractors for rice, maize, and tomatoes.

So, the first thing we do is to talk to our farmers and ask them the type of crop they want to produce, we then go and look at their fields. We cannot sale the wrong tractor because we want to sell a tractor, because if you sell a wrong tractor you have messed up the farmers business and you have messed up our common goal of increasing yield in this country on sustainable basis. We take the need of the farmer very seriously and we cannot afford to mess the farmer up. We are not interested in getting money out of their pockets; we are not that kind of company. There are other tractor suppliers and other competitors around us that are equally doing good jobs here in Nigeria. They are good people and companies, I admire them all.

Roles of AGCO and Massey Ferguson in Nigerian mechanised farming

AGCO manufactures for Massey Ferguson and it is the world’s largest tractor manufacturers. The number one market today that AGCO is focused on is Nigeria. They are actively talking to the Federal Ministry on how they can help Nigeria increase mechanisation. They are talking about how to help in line with the federal and state government policies on how to remold tractors so that they will be fitting for Nigeria, help us increase the number and qualities of agricultural support and service centers. We are about to build a new agric centre in Abuja and the fundamental will focus on tractors. Few years ahead we are going to have another one in East, Lagos.

Funds invested in Nigeria so far

When we started we had an investment plan in excess of $2 million. I can’t quote AGCO specifically because I know that countries come with their individual businesses, but I know that AGCO put aside $80 million investment in sub-Saharan Africa, which I know that Nigeria is number one priority. We hope that the first lap of investment is expanding the number and quality of agric service centres, and this is in line with the federal government policy on having more farm mechanisation centres. The second stage we hope and strive that one day we are bringing the presence of AGCO to you here, because we hope that one day we will be assembling tractors in Nigeria. I know that it will be a long journey but that can happen, we have to have a critical mass on the number of tractors the market will absorb. Nigeria is one of the least mechanised farming countries in the world, measured in about thousand arable lands less than Chad.

Nigeria is one of the least in the world, with less than three tractors per thousand hectares, which is why Nigeria imports much food. You can’t think of agriculture without combining various technological know-how, equipment and tools. If you talk about agriculture, it is not just about the equipment you work on, you think of the right know-how and technology. Today, tomato, which is one of the most important items in Nigeria, we produce 5 to 7 tonnes per hectare of tomatoes; we are bringing these systems in Nigeria and it is already here. We have as much as minimum of 200 tonnes per hectare; these are the kind of crop equipment Nigeria must achieve. Not just to produce the level of crop that we eat but to make it sustainable and bring farmers of middle class into this level.

Tomato production in Nigeria

I am loyally becoming a major player in the agric sector in Nigeria in terms of bounteous businesses because we are committed to build the world largest tomato manufacturer; we are probably the best tractor suppliers in the world. We are not into the business of selling low quality, insufficient tractors that can do the job. We need to buy the right tractors for the farmer, we are doing the right thing and the business is good.

Raising the bar in the agricultural sector

It is not all about trade and trade; you must keep enhancing the skills of our local people here and try to improve them. We are also looking at the value chain, from land preparation up to processing and at every point we want to see value added in the production process. In this way it gives us an integrated approach in solving the agricultural problems and this is our trend.

Landmarks in tomato production

A good example is in the irrigation. We are installing centre for irrigation. Another example is setting up the home of work; we are providing the equipment and training. We got a lot of mini projects that will provide irrigation process and many other things. We have a lot of public and private fund initiatives. Talking about how agriculture impacts on the economy, I will give you the example of Kenya; Kenya has become the world’s third largest suppliers of flower in the whole world. We supplied to them 80 per cent of what we had. Twenty years ago this business did not exist in Kenya but they have become the third largest, now bigger than Holland which was the second largest supplier of flower. That is what I want to do in Nigeria; I want Nigeria to become the largest supplier of tomatoes in the whole world. I don’t just want Nigeria to provide tomatoes for its own people; I want them to export tomatoes.

Nigeria’s agric sector

It is an incredibly important sector, and Nigeria need to be serious in it, in terms of how she is blessed, in terms of lands, climate, and many other things; Nigeria should be leaders in agriculture. I think the federal government is correct, government needs to get back to the business of agriculture, government needs to assist in building infrastructure to help the private sector to build a successful agricultural sector. One of the frustrations of government and it is a very difficult challenge is having its plans and initiatives for farmers being abused by speculators and all kinds of dubious characters.

For example, non-agricultural sector can go on with 20 to 25 per cent interest rate, but it is impossible to achieve agriculture with it. The government has to provide loan of low interest rate for farmers, so that they can invest in lands, crops and equipment. With bureaucracy involved, it becomes more cumbersome and the scheme is to getting out to more farmers and it is a very difficult challenge for the government. Now they have to get the right scheme in place without getting it abused. The world is running out of arable lands and water to make sufficient food, but what we have here is sufficient arable lands, labour, water to make food. So, there is huge opportunity in Nigeria.

Partnering government

Yes, the federal and state governments are our customers as well as the private sector. I think the government not being positive in getting its hands out of the business of agriculture is definitely incorrect. For instance, look at the business of telecommunications, I came back to Nigeria in 1997 and there was about 50,000 Nitel lines, but today there is about 110 to 120 million lines accessible and all of them are working, which are all private communication companies, why? Government is not involved.

There is no business that government places its hand that does work; the same will happen in agriculture, the same will happen in power. The government knows this and they understand it. The change is difficult and it takes time because of different conflicting forces and priorities. The more wealth creation gets into the hands of people and leaves the hands of bureaucrats, the better; it has happened time after time, in one country after another. This is what Nigeria is trying to do, one step forward and two steps backwards but it must surely happen.

Effect of government policies

Yes, of course it affects every business, from businessman to businessman, industrialist to industrialist; government needs to do something about the cost of money in this country. You cannot build an economy in any private sector with 25per cent interest rate; it is not possible. I understand the challenges of government and the Central Bank, the policy is the best they can achieve for now and it makes sense, but that policy which is working in the country is creating unemployment. We have 4 million graduates a year who go into the market place but can’t find a job, that is 40 million graduates in 10 years. They don’t find a way of making employment in the hands of people.

Current agricultural revolution

I think it is the transformation agenda pattern. If we concentrate on crops we can get tangible advantage. I think in reality the Minister of Agriculture has huge challenges with bureaucracy and that won’t change overnight, and it needs radical change. The challenges here are enormous, there are huge infrastructural challenges and all these are happening on top of inadequate infrastructure, not just physical infrastructure, but the infrastructure of democracy itself.

Achieving industrialisation rebirth in agric sector via Vision 20:2020

They have to improve in their power supply. They have talked about the power issue; they have to continue providing local content initiatives. They have to put in place the infrastructure growing order, protect the investor, consumer, employee and employer. All these things need to be put in place; there is a lot of work to be done. The fundamental responsibility of the government is to put the structures of life in place, such as financial, legal, institutions, physical infrastructure. These are the things the government needs to focus on and they will create employment through agricultural and attain food sufficiency, which are the major goals of the Vision been pursued by the government.

Adewale Odubiyi
Owner, Nigeria Oil & Gas Forum

Nigeria Oil & Gas Forum

Mechanisation, the Way out for Nigerian Agriculture
« on: May 07, 2013, 05:03:00 PM »


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