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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.
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.
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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
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Several business opportunities - component parts of the Integrated Developing Scheme described in Africans, Stop Being Poor! are listed in following table.
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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) |
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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
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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:
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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.. |
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OPERATING DATA Based
on above conditions the following operating data are obtained:
| | Amount
US) | |
INVESTMENT
| | Working
Space Layout: Plant floor for grinding and storage of
flour bags. Etc. 600 sq. meter |
5,500
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2- Processing Equipment: 4 hammer mills, packaging
equipment, 1 handling forks, 50 reinforced plastic palettes, masks, working clothes,
Etc.. |
19,500
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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
PROFIT | 36,925 |
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.
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