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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.
If you are a regular and faithful reader, welcome back.
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THE PROBLEM OF BANK GUARANTEE
/ COLLATERAL TO SECURING LOANS FOR PROJECTS IN AFRICA
Lenders will not take the risk to lending funds to the
promoter of a project without the certainty of recovering
their funds in case of project failure. The Bank Guarantee
and other
collateral and security they usually request from the
Borrowers provides an irrevocable third party guarantee
to the Lender against any loss.
The issuance of a bank guarantee has been and remain
a major long-standing roadblock for many entrepreneurs
from sub-Saharan African countries and, frequently,
good, high profit making projects are unable to obtain
necessary funding. They end-up in limbo.
BusinessAfrica™ / Dr. Quenum And Associates / Financing
Partner(s) are always searching for ways and means to
solving the bank guarantee problem; in order to assist
their client(s) securing
much needed funds to starting or expanding their business.
For that matter BusinessAfrica™ / Dr. Quenum And Associates
/ Financing Partner(s) have added a new financing
"Guarantee tool" to their collateral / security
basket which deals specifically with business expansion
project.
If you are planning to expand your existing business
and need funding you may use that possibility based
on the combination of Insurance and Reinsurance policies.
For more on the matter please do visit following
link..
Contributor's
Guidelines is 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 April 15,
2002.
Dr.
B.M. Quenum
Editor
of AFRICABIZ
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Several business opportunities with high profit making
potential which are economic
catalysts and components to the Strategy for African Countries - here
available - have been introduced to you. They are listed
in following table.
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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)
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TROPICAL FRUITS INDUSTRY AS INCOME
BUILDING POWER FOR AFRICAN COMMUNITIES/
PART II : THE PASSIONFRUIT AND THE FRUIT JUICE
INDUSTRY
Passiflora Edulis - commonly known as Passionfruit
- is a fruit which gives a powerful tasting and appealing
flavored juice (One drop of highly concentrated passionfruit
juice is enough to flavoring 12 liters - three gallons
- of pure water to a sweet beverage). For that reason
the passionfruit juice is used to blending other fruit
juices (orange, guava, pineapple and so on). The industry
of ice-creams and candies also makes large use of the
passionfruit juice and its byproducts.
Main producers are: South
Africa, Australia, Brazil, Colombia, Fiji, Taiwan,
Guyana, Hawaii, Japan, Kenya,
Peru and Sri-Lanka.
One can notice that only two sub-Saharan African countries
are listed as main producers. Other minor sub-Saharan
African producers are: Cameroon,
Cote
d'Ivoire / Ivory Coast.
The demand for passionfruit juice on the marketplace
being higher than the offer, there is an opportunity
for any African country to entering the very lucrative
worldwide tropical fruit juice's industry through the
development of Passionfruit's plantations and processing
units.
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VARIETIES OF PASSIFLORACEAE FAMILY SUITABLE FOR INDUSTRIAL
PLANTATIONS
 There
are two varieties of Passiflora Edulis (out of more
than 400 species of Passifloraceae family) which had
been extensively developed in several countries around
the world and processed to fruit juice: the Yellow
species (on the image at left) and the Purple
species However there are also other species of Passifloraceae
family which are mainly cultivated in some South American
countries (Sweet Granadilla / Passiflora Edulis
var. flavicarpa; Banana Passion Fruit / Passiflora
mollissima).
Banana Passion Fruit is the one which tastes the most
deliciously sweet and also the less industrially processed
into fruit juice and byproducts.
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POTENTIAL FOR GREAT DEVELOPMENT
The development of passionfruit represents a niche
activity - for African investors - to entering the worldwide
market of fruit juice. Furthermore It is a perfect
economic
catalyst as in addition to the juice produced (36%)
the commercial processing of the yellow passionfruit
also yields 51% of rinds, and 11% of seeds.
The rinds can be chopped, dried, and combined with molasses
as cattle or pig
feed. They can also be converted into silage. Milling
of the seeds produces 23% of edible and industrial oil
similar to soybean or sunflower oil.
Not to forget the promising medical uses. There
is currently a revival of interest in the pharmaceutical
industry, especially in Europe, in the use of the glycoside,
passiflorine, especially from P. incarnata L., as a
sedative or tranquilizer. Italian chemists have extracted
passiflorine from the air-dried leaves of P. edulis.
For more on that matter click
here.
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PASSION FRUIT PLANTATION DEVELOPMENT
One should bear in mind that the successful cultivation
of Passiflora Edulis to reaching high level of production
and good quality of fruit - to be subsequently processed
into fruit juice - requires fairly "sophisticated"
agricultural techniques, attention and constant care.
Below listed few specifics of this opportunity:
1-
Purple species originated from high altitude
topical regions. Yellow species from lower
altitude of tropical regions and is the most suitable
for highest tropical temperatures.
2- Passiflora Edulis plants are tropical creepers
(liana similar to vine plant) which supports
/ needs rainfalls between 1.500 mm / 1.750 mm
per year (as in the Olyfberg region in South Africa)
to 600 mm per year (Transval region in South Africa).
And also supports heavy rainfalls like in Hawaii
(2.125 mm to 3.680 mm per year).
3- Productivity ranges from as low as 8.5
metric ton per hectare to 46 metric tons in compound
cultivated with high expertise in Hawaii. The
average for a "normal" plantation being
15 to 20 metric ton per hectare.
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This exposure of course does not cover all the aspects
of the cultivation of Passifloraceae plants. It is just
a quick brief to attracting the attention of investors
to this niche agribusiness development.
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ECONOMICS TO SETUP 500 HECTARES OF PASSION-FRUIT
PLANTATION
A - Figures listed in table below are linked to following cultivation
conditions:
1-
Cultivation technique with the liana (creepers)
guided and held by iron-made wiring system / fences
/ palisade / trellis: (see figure below current
paragraph)
- 1-a: Spacing between two palisade-lines
is 3 (three) meters.
- 1-b: Palisade wiring
with galvanized iron threads leveled at 1,80 meter
above the ground; and prompt up by wooden stakes
positioned at 5 (five) meters from each other.
- 1-c: Passionfruit plants are located
at 5 (five) meters from each other; slightly drove
off the position of nearby wooden stake; and inserted
into a small rising above the ground level.
2- Irrigation by flooding technique guided
by drains.
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Passionfruit
trellis elevation: (A) main leaders; (B) secondary leaders;
(C) post;
(D) wooden or bamboo stakes; (E) 2.5mm high-tensile
wire; (F) passionfruit plant; (G) laterals -
Courtesy of The Horticulture
and Food Research Institute of New Zealand Limited
B
- Estimate of investments
to establishing 500 hectares of passionfruit plantation:
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Amount
(US$ x 1,000) |
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INVESTMENT
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1-
Land preparation: Land
acquisition - Land clearing with heavy machinery
- hand clearing of stubs and shrubs - harrowing
- ground leveling and so on.
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380
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2- Establishment of the
irrigation system: Reinforced concrete
catch drain - adjacent main drains - gutters -
800 metric cube water tower and so on.
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150
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3-
Establishment of the palisade / fencing / trellis:
Wooden stakes positioning - inserting into ground
of the stakes - fixing of iron wire - planting and
miscellaneous works linked to planting (manure filling,
phytosanitary treatment) - nurseries setup. Etc. |
850 |
4-
Farming and general equipment:
Two 45 CV wheel type tractors - Two 80 CV wheel
type tractors - Seven 6-metric tons trailers - two
bucket-trucks - water pumping engines - One 150-KVA
power engine. Etc. |
220 |
5-
Shelters and Buildings:
500 square meter open shelter - Storage facilities
and offices - Housing for management. Etc. |
300 |
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6-
Starting expenses:
Feasibility study / Business Plan - startup agri-technical
assistance. EtcS. Click
here for tentative
terms of references covering the plantation establishment
(Processing plant's Feasibility Study / Business
Plan excluded).
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190
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Total
investment
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2,090 |
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PRODUCTION
LEVEL
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With
good weed control and adequate fertilization; permanent
care, clipping and trimming of laterals; the annual
harvest - based on an average 15 metric tons yield
per hectare = 7500 metric
tons of passionfruit. |
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OPERATING
COSTS
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Operational
Expenses:
Hand weeding - pruning, trimming and clipping of
plants - cross pollination - irrigation - equipment
maintenance - harvesting - insurance - utilities
- fertilizers - plantation phyto-treatment - staff
and hands / management salaries - external management
assistance - amortization. Etc.
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450 |
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ONE
METRIC TON PRODUCTION COST
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Total
Operational Expenses / Production level
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US$60
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ESTIMATE OF THE TOTAL REVENUE GENERATED BY THE PLANTATION
The production cost of one metric ton above outlined
is fairly good (compared to off- plantation prevailing
selling price of some African producers on the market
place: US$ 106) and allows for the application of a
wide and competitive beneficial margin. Let's be
conservative and apply just 30% margin this gives
us a selling price off-plantation
of US $78 per metric ton.
The global revenue generated by
the plantation stands therefore at: 78 x 7500 = US $
585,000. Enough to cover operational expenses year upon
year.
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INVESTMENT ESTIMATE OF A PLANT
TO PROCESSING PASSIONFRUIT INTO FRUIT JUICE CONCENTRATES
In next Issue
N° 36 - April 15 - May 14, 2002 - we
shall continue the introduction to this opportunity
with a global estimate of the processing plant. The
purchasing price of the raw material by the processing
plant being set at US $ 86 - taking into account
10 % price increase (over above mentioned off-plantation
selling price of US $ 78) linked to transport and handling
operations to the plant (located not to far from the
plantation compound).
The passion fruit plantation establishment needs the drafting of a comprehensive
Feasibility Study / Business Plan that covers
all operational aspects (plantation establishment
and processing of pasionfruit to fruit-juice's concentrate);
that is to say: soil analysis; seeds and species
selection; nurseries setup, plantation organization
and management; plantation's production planning; processing
plant sizing, engineering coordination; operational
staff training organization and startup assistance;
marketing in Europe / Americas and Asia of processed
fruit juice. Business-to-Business online marketing
website designing, setup/ hosting and management's
training; additional business operations organization
to using byproducts (rinds and seeds). Etc. Click
here for services pricing
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- Interested parties - private African and international investors /
companies, government
agencies,
international development
agencies - to make contact through the Free Access Support Console available at this link
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