Gary Collar ‘We’re putting together both the capability and mechanisation’
AGCO’S senior vice-president for Asia-pacific and Africa outlines an all-in-one solution for smallholder farmers that the tractor manufacturer is trialling in Zambia
Everyone agrees that African smallholder farmers do not have enough access to training, inputs, finance and technology; what people disagree on is what to do about it. In terms of mechanisation, some governments are pushing for setting up tractor assembly plants with little concern about financing and upkeep. Start-ups like Nigeria’s Hello Tractor want to be the Uber of agriculture by matching up tractor owners with farmers who need their services. Us-based equipment manufacturer AGCO – which recorded $9.4bn in net sales in 2018 and includes the brands Challenger and Massey Ferguson – is now piloting its Farm In A Box (FIAB) initiative in Zambia. Delivered in a shipping container, it is a package combining essential farm machinery, upkeep tools, training and support.
Gary Collar, AGCO’S senior vice-president for Asia-pacific and Africa, says: “How does Africa feed itself, with the projected doubling in population by 2050? [...] It’s our obligation at this point in time to figure out a way to feed them. It is not just mechanisation, but mechanisation can be an important part of it.” He continues: “There are lots of examples of people that go out and provide a tractor. But unless the farmer knows how to use it, he’s not going to get the value out of it.”
Collar says: “Farm in a Box is more than just a container where we slam a tractor in there as parts and a desk area and that kind of thing, tools. It really is a system where we’re putting together both the capability and mechanisation. This is going to the product part of it, but also training – with a franchise sort of model.” Depending on the power of the tractor, which is its primary component, Farm in a Box will cost from around $80,000 to $100,000.
As of early 2019, AGCO had three FIAB units in Zambia to test them out before rolling them out more widely across the continent. In Zambia, AGCO also has a partnership with distributor BHBW Zambia and the Zambia National Commercial Bank to help entrepreneurs to finance their purchases.
AGCO currently takes in about $100m per year from its Africa operations. “It’s a good business, but it’s not as good as it can be. [...] We think that the overall business should be $100bn and our portion of that ought to be $1bn in Africa.”
The manufacturer has plans to invest $100m in Africa over a five-year time period. That includes the setting up of AGCO’S Africa team in Johannesburg, creating a sales office in Casablanca and putting more money into its model farm in Lusaka and its production operations in Algeria.
Collar also wants to see AGCO running agro-industrial parks, which have a patchy record in terms of success on the continent. “As good as the idea is, it’s still pretty slow to catch on and possibly exactly because of the fact that there are some risks. [...] We are in the process of identifying actual projects or actual land that could be developed. We’re probably looking at 10 different projects around Africa at this point in time, really from West Africa, way to north and east.”