We Can Even Do Better!

 

As already mentioned on this website, we are seeking a threshold of $15m for our intended agro-processing plant, which amount is itself unheard of in a place like ours, but which is warranted considering the ever-spiraling grip of poverty in our region.

We have also shown under “Funding Targets” in our current fundraiser for this plant, that we will install a specific portion of this plant once the money we have raised is at intervals of $240k; $620k; $1m and $15m. Implying, we will begin developing this plant once we raise $240k, and we will complete it once we have raised $15m in total. So, every little support that we can raise will make a strategic incremental beginning.

 

But that is not all:

What’s more, we can even do better, that is, we can even develop a more superior plant, and roll out our planned community work in an even more resilient way, if only we could find enough helping hands to help us raise a little over $15m (ideally $30m – $45m), which sounds even weirder, but which is exactly the kind of thinking it will take to end the scourge of poverty in remote poor communities like ours, for once.

Remember, Oprah alone once single-handedly put together $40m of her own money for a Girls Academy in South Africa, and has since injected millions more in the same school. That way, we really believe, if people like us, who are only emerging from the harshest forms of poverty, worked together with a team of global citizens who want to see a real end to poverty by 2030, there is no way we couldn’t raise $30m – $45m. Moreover, we really hate to say this but, the aid community spends even more money here in Africa, on projects that simply do not leave anything in place once they exit.

Nonetheless, if we only raise $15m, we will still cut our coat according to our cloth.

 

Here below is what we could do better, if only we could find enough helping hands to help us raise a little over $15m (ideally $30m – $45m in total) for our intended plant:

 

a). Farmer support:

As shown under our envisaged “Business Model” for this plant, which you can read by hovering over “Action Plan” on this website, in the beginning, we will need to provide all the target farmers with large volumes of seed/saplings all year round, regardless of whether these farmers already have the crops that our plant is working on or not, for reasons that have been described in more detail on our Business Model page.

Our seed/saplings will also be provided to all the participating farmers at no charge, but each farmer will only be able to get these free inputs for 1 – 4 planting seasons, depending on the type of crop they are growing. The most basic reason for this is to ensure that all farmers have the right variety of crops, lest their produce is rejected; increase the scope of production, and to ensure that even those farmers who have no inputs can participate equally, this time with a ready market for their produce.

To get an idea of what this work will entail, we will have large nurseries of mango; oranges; pineapple, and passion fruits all year round, and these must be able to suffice at least an average of two acres for each beginning farmer, across a region that spans over 3,500 square kilometers (Kamuli and Buyende alone, but farmers in neighboring communities might need help too). In addition to the fruit saplings, we will also provide farmers with sorghum and maize seed, as well as cassava cuttings.

What we can do better:

In our original $15m budget, we had allocated $200k towards farmer support, which also includes having a robust team, and transport logistics, to execute our community work. But this budget would be too small and too restrictive for the work described above. Before our own incomes from this plant become sufficient to cover 100% of our administrative costs, which we hope may take four years, we will need $0.5m in farmer support each year, for the first 4 years. This adds $1.8m to our original budget.

But, if we only manage to raise $15m, we will still cut our coat according to our cloth.

 

b). Fruit processing facility:

One of the most precious lessons we are currently learning from the Soroti Fruit Factory, which was installed by Uganda’s government two years ago in the Teso region (in the furthest part of eastern Uganda) with funding from the Korea International Cooperation Agency, is that this plant is currently rejecting much of the produce (i.e. mango and oranges) that have been grown local farmers in the same region, because farmers planted the wrong variety of fruits that aren’t suitable for juice production.

But an even more important lesson we are drawing there is: many farmers in Teso have highlighted that, had it not been for their produce to be rejected, it would have only taken farmers from one Sub County to produce the fruits needed to meet Soroti Fruit Factory’s current capacity of 6 tons/hour. The region altogether has 9 districts, of which Soroti district alone has 17 Sub Counties. In other words, once these farmers get the right species, then, that plant won’t even be able to support a single district.

By comparison, the Benfruit Plant, which was developed by Nigerian entrepreneur Tony Elumelu, has an annual capacity of 26.5 million tons of fruit, which is equivalent to 72,602 tons of fruit a day, versus 48 tons of fruit a day for the Soroti Fruit Factory. In our own case, we understand that our plant will also initially have a low volume of produce from farmers, but it will only be a matter of time before this all changes.

What we can do better:

In our original $15m budget, we had allocated $14m to a 6 ton/hour fruit facility, which is very approximate to what the government used to install the Soroti Fruit Factory, which is also of the same capacity, but which capacity could soon be outrun by farmers. So, while we certainly can’t think of developing a plant similar to Benfruit, we could at least install one that has twice the capacity we had initially planned for. That would require of us at least $14m more — adding $14m to our original budget.

 

c). Working capital:

Our original $15m budget does not include any working — the money that we will need to run the plant’s operations; buy produce from farmers; build market linkages, etc. From what we have gathered thus far, especially from the activities of Soroti Fruit Factory (which was recently installed by the Ugandan government in the furthest part of eastern Uganda), we will need at least 20% of the plant’s establishment costs, in annual working capital, especially since our own plant will also include other components — cassava starch and High Quality Cassava Flour, and sorghum/maize.

What we could do better: installing this plant without thinking of working capital ahead of time means we will either have to scale down the size of the plant, or even more frighteningly, run the risk of completing this plant but with no working capital to operate it. Before our own incomes from this plant become sufficient to cover 100% of our working capital, which could take 4 years, we will need $12m in working capital ($3m per year), for the first 4 years. This adds $12m to our original budget.

But, if we only manage to raise $15m, we will still cut our coat according to our cloth.

 

d). Cassava starch facility:

In our $15m budget, we had allocated $380k to a cassava starch utility. A relatively same-size starch facility was installed by a UK-based agribusiness group in The Gambia for $420k. And, according to the FAO, the average cost for a 24 ton/day starch facility in Africa is $736k. An even more ambitious cassava starch project has been planned by Uganda’s government in the furthest part of eastern Uganda, for UGX 47B ($12.7m).

What we can do better:

Given the geographical vastness of, and the level of poverty in, our region, it would be better if we could install a somewhat bigger cassava starch facility, than that of $380k, perhaps one that has the capacity to process 40 tons of cassava a day. Such a facility would require of us about $2m in total, adding $1.6m to our original budget.

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Conclusion:  Altogether, the above things would add $29.4m to our envisaged budget, bringing our total budget to $44.4m (when added to the original $15m budget).

But, if we only manage to raise $15m, we will still cut our coat according to our cloth.