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AFRICABIZ VOL 1 - ISSUE: 57
JANUARY 15- FEBRUARY 14, 2004
Previous Issue
Editor: Dr. Bienvenu-Magloire Quenum
editor@africabiz.org
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A WORD FROM THE EDITOR


Dear visitor and international investor,


We warmly welcome you, if this is your first visit to Africabiz Online - The ultimate newsletter on trading and investing in 49 sub-Saharan African countries. If you are a regular and faithful reader, welcome back.

HAPPY AND SUCCESSFUL BUSINESS YEAR 2004

AFRICABIZ ONLINE team wish you a happy and prosperous business year 2004

WARS ARE FADING OUT IN AFRICA

If one looks back to four year ago, civil and inter-states wars were raging across Africa. Angola, Ethiopia, Eritrea, Burundi, the Democratic Republic of the Congo, Liberia, Rwanda, Somalia, Sierra Leone, Sudan, and Ivory-Coast. Some of these countries were engulfed in devastating wars since two to three decades running (Angola and Sudan). Ivory Coast is a particular sad case that experienced 5 months of a bloody civil war - September 19, 2002 - January 2002 followed by a still persisting situation of "no peace no war".

However, since few months, dating back to June 2003, the situation is changing quickly towards peace. The international community - the United States of America (Sudan) , UK (Sierra Leone), France (Ivory Coast) and UN(Liberia) - are putting pressure on warring parties.

Thus, negotiations are now underway in several of these countries to reaching peace settlement; and consequently wars drums are getting less and less louder in Africa. It is to early to know for sure if all this is just a reprieve before the tempest. Yet, one should acknowledge that the mood is changing.

Warring parties finally realizing that the negotiation table is the best way to solving political disputes and conflicts and save countries from total disintegration. Click here to read more about the matter.

- Contributor's Guidelines are here to review. Your contribution on "How African countries / entrepreneurs could bridge the developing gap" is welcome.

Many thanks for dropping by and see you here on February 15, 2004.


Dr. B.M. Quenum

Editor of AFRICABIZ
Contact Dr. Bienvenu-Magloire Quenum

BUSINESS OPPORTUNITIES IN AFRICA

- Several business opportunities - component parts of the Integrated Developing Scheme described in Africans, Stop Being Poor! are listed in following table.

a- SHEA BUTTER (Issues 5, 6, 7, 11, 12, 13)
b- BLUE GOLD (Issues 14, 15, 16, 17, 18, 19)
c- FREEZE-DRIED PAPAIN (Issues 20, 21, 22 and here)
d- KENAF (Issues 23, 24)
e- VEGETABLE OIL (Issues 25, 26, 27 and 28)
f- CEREALS (Issues 30, 31, 32, 33)
g- FRUITS (34, 35, 36, 37, 38, 39, 40, 42, 43, 44, 45, 46)
h- ESSENTIAL OILS (47, 48, 49, 50, 51, 52)
i- ROOTS & TUBERS 54, 55, 56)

- INTRODUCTION TO TROPICAL ROOTS AND TUBERS: IV -INVESTMENT BRIEFS TO PRODUCING CASSAVA CHIPS

Cassava, potato, and sweet potato rank among the top 10 food crops produced in developing countries. Sub-Saharan Africa - SSA - is expected to experience the fastest growth in food demand for all roots and tubers, largely driven by rapid population's growth. SSA share in the total demand for developing countries will be 53 percent, with cassava accounting for two-thirds of the increase.

This series
started with the delivery available here and deals with the processing of the raw material. Cultivation techniques and particularities are not considered. Here available is a report on how to develop Cassava as a strategic crop

Rare are industrial concerns established in SSA countries that transform Cassava into value added products - as reported in the diagram available here

- INVESTMENT BRIEFS ON A SMALL-SCALE CASSAVA CHIPS PRODUCTION UNIT

Briefs on the preparation of fresh cassava prior to the production of chips and pellets are reported in previous issue. Let us consider a small-scale production unit operating under following conditions:

- Hand peeling output: 25kg of fresh cassava per hour and per person.
- Mechanical - pedal maneuvered - slicer output: 500kg of sliced (chipped / peeled cassava) per hour and per slicer [Source: Reported in Root Crop Processing (1993) Food Cycle Technology Books, Intermediate Technology Publications Ltd. London and at this link]
- Weight loss 25% per kg of fresh root.
- Finished sun dried cassava chip moisture content 10%. - 1 kg of fresh cassava gives 750gr of peeled cassava.
- At 75% initial moisture content, 1kg of fresh cassava gives 750gr of peeled cassava at 56.25% moisture content.
- 1 kg of fresh cassava yields: (.750 kg - [0750 x 46.25%]) = 403 gr of sun dried chips at 10% of moisture content

Conditions above listed lead us to tailor the medium-scale chips production as follows:

- 50 peelers to peel 50 x 25kg = 1,250kg of fresh cassava per hour or 1,250 x 8 = 10,000kg per day - 10 metric tons per day that yield 7,500kg of peeled cassava (2,500kg of wastes).
- 2 pedal maneuvered slicers that yield each 500 kg of Chips per hour. (Maneuvered by 2 workers).
- 6 handlers to feed the peelers and the slicers.
- Daily production of sun dried chips: 10,000kg of fresh cassava x .403 = 4,030kg o or 4 metric tons.
- Monthly production (26 days) = 4.030 x 26 = 105 metric tons and yearly production (over 10 months): = 1,048 metric tons.
- Raw material (fresh cassava) purchasing price: US$ 10 per metric ton.
- Bulk dried chip selling price: (ex-works) = 40 US$
- Waste (peeled cassava skin for animal feed preparation) selling price: US$ 2 metric ton
.

- OPERATING DATA

Based on above conditions the following operating data are obtained:

Items
Amount US)
INVESTMENT

Working Space Layout: Peeling, slicing, handling and storage. Etc. 300 sq. meter)

1,500

2- Processing Equipment: 2 pedal maneuvered mechanical slicers, knifes, 40 plastic containers (10 kg content)), drying shelves, 500 m of black plastic sheet, packaging equipment, 100 pairs of iron-braided gloves, plastic working clothes, 10 barrows. Etc..

4,500

Total investment

6,000
OPERATING COSTS

Operating Expenses: Raw material purchasing (fresh cassava)- production costs - insurance - utilities - staff and hands / management salaries - amortization - interests on loan. Etc.

32,000
PRODUCTION COST PER METRIC TON OF CHIPS
1,047.800 metric tons of sun dried cassava's chips =31
GENERATED REVENUES*
Chips : 1,047.800 x 40 = 41,912
Wastes = 650 metric tons x 2 US$ 1.300
TOTAL REVENUES 43,212
GROSS PROFIT
GROSS PROFIT11,212

REMARKS

1- This small-scale operation to producing cassava's chips is clearly a profit making business that creates at least 60 jobs. One can vision the impact it will have in the life of African countries' rural folks. One can also forecast the impact on the global economy if 1,000 operations like this one are established: 60,000 jobs (transformers) will be created in rural areas and the development of the cultivation of the raw material will be boosted altogether with the expansion of other activities such as transportation and packaging.

2- The selling price (40 US$ per metric ton - ex-works) is highly competitive as an addition of even 100% for C.I.F. - Cost Insurance and Freight expenses and taxes - would make the CIF offered price lower than the pricing on the international market place - as shown by figures (European Union) in Table below:

SELLING PRICES PER METRIC TON - US$
IN EUROPEAN UNION MARKET PLACE
1992199319941995199619971998
183137144177161158150
Source: United Nation Organization For Food and Agriculture

3- Production had been calculated over only 10 months a year; to taking into account sunshine's deficiency for two months. The weight loss par Kg of fresh cassava had been put at 25% (hand peeling); this could be improve to only 10-15% weight loss if mechanical peeling is chosen.

4- Cassava pellets are just agglomerated chip that are easier to transport and are environmentally friendly.. Pellets selling price is a bit higher than chips' ones.

Figures listed in Tables above show that the production of pellets and chips on medium--scale are opportunities not to be missed by African countries. Cassava pellets will
help not only developing livestock's production, but can be used to produce glues and alcohol that are currently imported from abroad in most African countries.

MORE ON ROOTS AND TUBERS
1- Roots & Tubers Market in Qatar
2- Roots & Tubers Market in Europe
3- Food Security: In Sub-Saharan Africa
In Latin America and the Caribbean
4- Roots and Tubers: A Vegetable Cookbook
by Kyle D. Fulwiler
5-
Tuber Crops
by N. M. Nayar

6- Roots, Tubers, Plantains and Bananas in Animal Feeding
Proceedings of the Fao Expert Consultation Held in Ciat, Cali, Colombia 21-25 January 1991
7- Pest Management for Tropical Roots & Tubers Workshop on the Global Status of and Prospects
8- The Tropical Tuber Crops
Yam, Cassava, Sweet Potato, and Cocoyams by I. Chukuma Onwueme

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