USAID’s Trade Hub announces its first co-investment partnership with Nigerian rice company
The USAID West Africa Trade and Investment Hub is partnering with Nigerian company WACOT Rice Ltd. to expand its base of rice farmers, with significant emphasis on creating programs that elevate youth and women in its network of growers.
The Trade Hub’s co-investment grant of $1.5 million will directly support WACOT’s $8.6 million investment in its Argungu Outgrower Expansion Project, which aims to onboard more than 5,000 new rice farmers, providing them with supplies and training to cultivate their land. WACOT expects that the investment will lead to a 50 percent increase in yield for the farmers, allowing them to reinvest profits in critical areas to expand their production and improve livelihoods.
“The overall impact is to enhance yield per hectare and help farmers better their livelihoods,” says Habiba Suleiman, Strategy and Business Development Manager at WACOT, which is a subsidiary of Tropical General Investments Group. “I’m so positive that this is a step in the right direction.”
Funded by the U.S. Agency for International Development, the Trade Hub is forging unique public private partnerships to unlock capital, create jobs, and catalyze sustainable economic growth in the region. With a major priority to increase food security amidst a rapidly growing West African population, the partnership with WACOT Rice fulfills a core pillar of the Trade Hub’s mission and USAID’s goals in the region.
“The U.S. government is pleased to partner with the private sector in Nigeria to develop market-driven solutions and sustainably improve food security by supporting local rice production,” says USAID Mission Director Anne E. Patterson. “With this new co-investment partnership, smallholder farmers in Kebbi State can increase yields and improve the livelihoods of their families.”
Meeting local demand, improving food security
Rice is a staple for Nigerian families, who consume more than 7 million tons per year. In what is now known as Nigeria’s “Rice Revolution,” during the last several years Nigeria has gone from importing the majority of its rice from Asia to producing most of it in local paddies.
Though local demand is far from met, companies like WACOT are working to transform arable land into opportunities for communities to enter the rice value chain. Keeping food production local for staples like rice strengthens economies, reduces its reliance on imports and alleviates the environmental impact of the broken global food supply system.
This co-investment grant ties directly with one of the Trade Hub’s major goals: to bolster food security and Nigeria’s self-reliance. Feed the Future, the U.S. government’s initiative to reduce global hunger, funds the Trade Hub’s deal with WACOT. Feed the Future works to increase the poor’s access to nutritious food and transform the agricultural sector.
“Food security is key because of the very serious poverty in these communities,” says Suleiman. “This cycle continues repeating itself. Smallholders are usually the owners of half a hectare of land they inherited, and the farm labor is the wife and children with no mechanization which leads to harvest losses.”
Harvest losses are a critical pressure point for the rice value chain in Kebbi state. According to WACOT, rice farmers lose significant amounts of rice each growing cycle because of the lack of technical knowledge, access to roads and milling and storage facilities and quality inputs. Its Argungu Outgrower Expansion Project plans to stem unnecessary loss of rice through providing high-quality agricultural inputs such as hybrid seed and fertilizer, training and direct access to the market.
Importantly, WACOT also guarantees “offtake” at the end of the harvest, meaning farmers won’t be short-changed by not being able to sell their rice at fair market prices if demand fluctuates.
Technological innovation is another piece of the puzzle in increasing food security while ensuring producers aren’t left behind and are fully integrated into the rice production system. To maintain transparency and good communication between the farmers and the company, WACOT offers access to rice growing apps and employs its Agricultural Management System to track smallholder farmers’ activity, offering timely direction on agricultural practices and monitoring production.
“In terms of their earnings, [this project] helps them send their kids to school, to access better livelihoods, to access better healthcare and to have better nutrition,” says Suleiman.
Investing in women and youth
Because of cultural barriers and other constraints, women and youth are often left out of economic expansion activities in rural areas. In its Argungu Outgrower Expansion Project, WACOT is placing a strong emphasis on elevating these vulnerable populations.
Of the new farmers the project will onboard, 50 percent will be women and 70 percent will be youth. In communities in Kebbi state, youth usually don’t have access to land because ownership is typically determined through inheritance. WACOT will work with youth to bring them greater access to jobs and farming opportunities in their network, aiming to reduce youth unemployment in the region.
“We go down to the grassroots [level] and ensure that these people are empowered for life,” says Suleiman, referring to the skills development WACOT offers its growers.
One of the Trade Hub’s objectives is to dedicate 50 percent of the jobs created through its grants and partnerships to women, closing the gender gap in the workforce in the region.
“Having a strong gender inclusion component in the first grant we announce is a great step for us,” says Chioma Adiele-Okpara, the Trade Hub’s gender specialist, who is developing strategies to include women’s inclusion elements in all of the Trade Hub’s co-investment grants.
With its first grant designed to impact farmers in an under-resourced state in Nigeria, the Trade Hub is setting the tone for future investments and partnerships. Hand in hand with WACOT’s initiative, the Trade Hub’s mission is to catalyze sustainable economic growth that reaches those at the bottom of value chains as well as competitive businesses.
“We are glad to be partnering with a company that has a track record of impacting thousands of rice farmers,” says Michael Clements, the Trade Hub’s Chief of Party.