24th August, 2021
Nigeria’s leading commodity player, AFEX, has partnered with agricultural investment company, South-West Agriculture Company (SWAgCo), and the Ogun State Government for the development of five thousand hectares (5000 ha.) for the production of multi-crops in the South-West region of Nigeria.
The partnership was announced at an MoU signing ceremony at the deal room of the Feed Nigeria Summit 2021.
Focus crops for the partnership include cassava, rice, and maize.
The Commissioner of Agriculture for Ogun State, Dr Adeola Odedina, highlighted the alignment of the project with the ambitions for agriculture in the state.
“Our agricultural agenda as a state continues to be bold and exemplary, and this agreement is a very important step in that agenda. Together with AFEX and SWAgCo, we are creating a Staple Crop Zone as a vital part of the execution of the Special Agro-Industrial Zone (SAPZ) for the state, being developed in partnership with the Federal Ministry of Agriculture and Rural Development (FMARD) and the African Development Bank (AfDB).”
AFEX will deploy its exchange platform to both raise financing for the project and enable market access for the products derived from the project.
“Our partnership with the Ogun State government and SWAgCo is integrating the private sector’s efficiency and innovation with the forward-thinking plans and agenda of the government of Ogun state in a way that will create jobs and enable wealth creation for the country”, said Ayodeji Balogun, CEO, AFEX, while signing the tripartite agreement at the deal room of the Feed Nigeria Summit.
“As a commodities exchange and capital market player, we are able to deploy a blended finance product that will drive production and industrialization within the state, and help to achieve the mandate of the SAPZ,” he said.
Balogun said that AFEX’s goal is to create a way to triple the yields of staples to six-eight metric tons and continue to produce wealthy farmers for Nigeria, stating that the company would not stop in the South-West region but would spread its operations across all regions in Nigeria.
Although the project will be funded from both public, development as well as private and commercial sources, AFEX, as a commodities exchange, will be responsible for mitigating the project’s market risk by ensuring that the project’s output is guaranteed market access.
Commenting at the signing ceremony of the tripartite agreement, the MD/CEO of SWAgCo, BabajideArowosafe, said, “We are working with an institution like AFEX that is able to structure the agricultural food system in the country in a commercial way that delivers value to different operators in the value chain.”
“We have come into an alliance with AFEX to drive the SAPZ agenda in partnership with the Ogun State Government. We have a triplicate agreement – AFEX, SwagCo, and the Ogun State Government – to create the right platform for a seamless takeoff of the SAPZ agenda under commercial and private sector terms.
“In the long run, we want to industrialize the agricultural space within the southwest and then for Nigeria as a country. We hope to have a partnership that encourages private sector operators to come in and benefit within the SAPZ agenda to deliver a more structured industrial revolution in the country,” Arowosafe said.
The execution of the agreement will strengthen all levels of agricultural activities in Ogun State, and help in job creation and the achievement of food security for the country.
At AFEX we harness Africa’s commodities and talent to build shared wealth and prosperity. Our infrastructure and platform investments work to unlock capital to power a trust economy in Africa’s commodities markets.
Since its inception in 2014, we have developed and deployed a viable commodities exchange model for the West African market, and are on track to impact one million producers; providing services in productivity and value capture and access to finance and markets. By deploying an efficient market system, we will facilitate trade with Africa worth over USD500 million in the next five years.
AFEX’s vision is to be the reference point for commodities in Africa. To achieve this goal, AFEX looks to introduce products that de-risk the sector, drive financial inclusion for rural communities, develop technology for data collection and market access, and enable capital deployment.
SWAgCO is an Agricultural Investment Company and it is fully owned by its parent company, Odua Investment Company. With a capital base of N25Billion, SWAgCO was established to unlock unrealized agriculture and agribusiness value by transforming underinvested agribusiness opportunities within Nigeria into institutional-grade investment operations.
The parent company, Odua Investment, is a private holding company with shareholding by the South-western Governments of Nigeria.