The grain market in Zambia has traditionally been dominated by two players: (i) informal ‘briefcase buyers' (ii) and the government-owned Food Reserve Agency. Both have their drawbacks for farmers looking for a dependable and fair off-take market, including poor payment terms and lack of modern weighing equipment. The second challenge is preventing post-harvest losses, which has a negative impact on food security and can be prevented by investing in modern technologies and professional stock management.
AgDevCo partnered with two investors to create NGHL, a grain handling and storage business operating on mandates from grain buyers. The business procures directly from small-scale farmers, offering farmers transparent prices and cash on delivery. To catalyse this investment, AgDevCo has committed $1m to NGHL for the financing of grain handling equipment, and a further $71,356 for a 10% equity stake in the company.