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AFRICABIZ VOL 1 - ISSUE: 58
FEBRUARY 15 - MARCH 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.

COULD AFRICAN GOVERNMENTS RAISE MONEY TO FINANCING INTEGRATED DEVELOPING SCHEMES?

Since the publication online of Strategy For An African Country five years ago, we received many feedback. Most of the times people deemed it impossible for African countries to set up developing schemes capable to generating double-digit economic growth rates on a sustained basis for decades running. The main argument raised is the lack of financing.

To give a complete answer to the matter, we are finalizing a book - about how Africa could quickly bridge the eveloping gap - to be published this year 2004 and that covers several aspects of Africa's developing. The financing problem is extensively discussed in said book and several avenues to finding solutions explored.

In the meantime, here are exposed preliminaries that show that financing is available on the international money marketplace to carry out profit-oriented projects.

- 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 March 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 ( 5, 6, 7, 11, 12, 13)
b- BLUE GOLD ( 14, 15, 16, 17, 18, 19)
c- FREEZE-DRIED PAPAIN ( 20, 21, 22 and here)
d- KENAF ( 23, 24)
e- VEGETABLE OIL ( 25, 26, 27, 28)
f- CEREALS ( 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, 57)

- INTRODUCTION TO TROPICAL ROOTS AND TUBERS: V -INVESTMENT BRIEFS TO PRODUCING CASSAVA FLOUR

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 MEDIUM-SCALE CASSAVA FLOUR PRODUCTION UNIT

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

- 8 Operators for 4 hammer mills / per 8 hours shift - 2 shifts.
- 4 Hammer mills - 25 hp each - that processes each 300 kg of dried chips per hour. (-2% loss) to producing 1,176 kg per hour of cassava flour of 10% Moisture Content (MC)
- 8 handlers per shift - to feeding the mills and handling cassava flour bags.
- Daily production of cassava flour: 1,176 kg x 8 x 2 = 18,.816 kg = or 18.816 metric tons.
- Monthly production (26 days) = 18.816 x 26 = 489.216 metric tons and yearly production (over 10 months): = 4892.160 metric tons.
- Raw material (dried cassava ships purchasing price):US$ 40 per metric ton
- Cassava flour selling price: (ex-works) = 58.65 US$ per metric ton..

- OPERATING DATA

Based on above conditions the following operating data are obtained:

Items
Amount
US)
INVESTMENT

Working Space Layout: Plant floor for grinding and storage of flour bags. Etc. 600 sq. meter

5,500

2- Processing Equipment: 4 hammer mills, packaging equipment, 1 handling forks, 50 reinforced plastic palettes, masks, working clothes, Etc..

19,500

Total investment

25,000
OPERATING COSTS

Operating Expenses: Raw material purchasing (dried cassava chips), 50 kg and 25 kg woven plastic bags,- production costs - insurance - utilities - staff and hands / management salaries - amortization - interests on loan. Etc.

250,000
PRODUCTION COST PER METRIC TON OF FLOUR
4892.160 metric tons of cassava flour from 4990 metric tons of sun dried cassava's chips =51
GENERATED REVENUES*
Cassava flour: 4892.160 x 58.65 = 286,925
GROSS PROFIT
GROSS PROFIT36,925

REMARKS

1- This medium-scale operation to producing cassava's flour from dried cassava chips is clearly a profit making business that creates at least 35 jobs. One can forecast the impact on the global economy if 100 operations like this one are set up to transforming 50 % of the sun dried chips produced by 1,000 producers (see here for more on that matter) that is approximately 523,000 metric tons of sun dried cassava chips. At let 3,500 jobs will be created in rural area the development of the cultivation of the raw material and boosting of other activities such as transportation and packaging.

2- The selling price (58.65 US$ per metric ton - ex-works) is highly competitive against selling price of cereals' flour (corn and sorghum) available on African local markets; therefore the production will benefited from a huge market's penetration drive.

3- Production had been calculated over only 10 months a year; to synchronize with sun dried cassava's chip production. However, it is possible to produce over 12 months period and therefore increase the Gross Product.

Figures listed in Table above and the one available here show that the production of cassava pellets, chips and flour on medium and small scales 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. Next issue will review a strategic plan based on chips and flour production in an African country.

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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