44 • Trader Profile• C&CI May 2012
Cocoa exporter cuts out the middleman
S
ierra Leone has long been known as a cocoa producer and as an origin for Robusta coffee, but pro-
duction of both fell dramatically during the country’s civil war. Before the civil war began in 1991, cocoa was Sierra Leone’s number one agricultural export; once the war was over, the World Bank and others advised the government there to focus on cocoa once again because of its growth potential. As a World Bank study concluded, the best thing that the government in the West African country could do, would be to "Get the cocoa sector working again." TFL was set up approximately three
years ago by Adrian Simpson, who has long experience in cocoa in Côte d’Ivoire, Ghana and elsewhere, having worked for well-known companies such as ED&F Man. Mr Simpson could see that Sierra Leone had the potential to be a leading producer again, but wanted to go back into the country with a new model, one that he hoped would help increase output and quality at the same time. In July of 2011, TFL was acquired by Agriterra, providing Agriterra with a plat- form from which to expand into cocoa pro- duction, making use of TFL’s regional expertise and established buying opera- tions in West Africa.
Long-term relationships
Agriterra is an AIM-listed agricultural com- pany with four divisions: beef, maize, cocoa and palm oil. The company intends to focus on secur-
ing cocoa supplies for the business through a combination of forging long-term relation- ships with farmers and out-grower schemes, implementing farm management initiatives and in time, through the development of the company’s own cocoa plantations. In keep- ing with Agriterra’s beef and maize business- es, the company intends to transform TFL into a vertically integrated business, utilising a ‘tree to market-place’ business model. In global terms, the volume of cocoa that TFL is handling is small, but it is
Now owned by pan-African agricultural company Agriterra, Tropical Farms Ltd (TFL) has entered the cocoa market in
Sierra Leone with a unique business model that eliminates agents and focusses on traceability and sustainability
Mr Simpson says
production is increasing rapidly and quality is improving all the time
expanding rapidly. "Three or four years ago we were only exporting 50 tonnes, but that grew quickly in our second year to 500 tonnes and to 1,000 tonnes this season," Mr Simpson explained, noting that it is in the process of renovating and rehabilitating an existing plantation and expanding it with new plantings.
Fast-expanding operation
"The difference between us and other com- panies is that we don’t buy via agents," he explained. "You just can’t get the level of traceability that we are after if you use agents. We have grown quite quickly and our buying network has expanded to 14 locations." Agriterra says it is targeting 40 buying
locations in total by the end of 2012, and is already expanding its buying and trad- ing commodity focus to include Robusta coffee and palm oil. Negotiations are underway to secure a 15-acre site in
Sierra Leone’s New Airport Development Zone in Freetown, in order to build a col- lateral management facility. Andrew Groves, Agriterra’s CEO, said:
"Our cocoa buying and trading operation in Sierra Leone is rapidly advancing. It is our aim to become a leading in-country trader of sustainable and traceable cocoa by the end of the year." TFL’s reputation is building rapidly
through direct relationships with farmers and out-grower schemes. The company continues to implement initiatives, includ- ing modern farm management techniques and farmer incentive schemes, which have proved extremely successful in Agriterra’s maize production and process facilities in Mozambique, and Mr Simpson is confi- dent that similar results can be achieved with cocoa production in Sierra Leone.
Quality improving
Asked what the biggest challenges are in Sierra Leone, Mr Simpson said the most obvious one, quality, was improving rapid-
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