MacadamiasMacadamiasCreating the new agriculture middle class

MacadamiasMacadamiasESTABLISH A ESTABLISH A

PROFITABLE AND PROFITABLE AND SUCCESSFUL SUCCESSFUL

MACADAMIA INDUSTRY MACADAMIA INDUSTRY

INTRODUCTIONINTRODUCTION Agriculture is the most important driver for Agriculture is the most important driver for

broad based economic development broad based economic development Macadamia is a high value crop with Macadamia is a high value crop with

meduim to long term production yield meduim to long term production yield Macadamia nut sales presently represent Macadamia nut sales presently represent

less than 2% of the global nut basket less than 2% of the global nut basket increase in production sites are still increase in production sites are still lagging the global population increase.lagging the global population increase.

Macadamias Macadamias AdvantagesAdvantages

Easier crop to farm with, if the Easier crop to farm with, if the following 5 principles are adhered to:following 5 principles are adhered to: Select best genetics and cultivar Select best genetics and cultivar TrainingTraining Co-Operative assistance Co-Operative assistance Central research Central research Central processing marketing system Central processing marketing system

Macadamia advantages Macadamia advantages

Offers the Possibility of Inter CroppingOffers the Possibility of Inter Cropping Sugar Cane Sugar Cane BambooBamboo Pineapple Pineapple CattleCattle PapayaPapaya

Macadamia PotentialMacadamia Potential AustraliaAustralia -- 8 200(2011)/40 000(Currently)8 200(2011)/40 000(Currently) South AfricaSouth Africa -- 8 514(2011)/48 000(Currently)8 514(2011)/48 000(Currently) HawaiiHawaii -- 6800 (2011)/7500 (currently )6800 (2011)/7500 (currently ) Hawaii production started in 1950 – 870 ha Hawaii production started in 1950 – 870 ha Currently have 1.3 million trees in production producing Currently have 1.3 million trees in production producing

3.2 tons per hectare with 180 trees per hectare 20.9 3.2 tons per hectare with 180 trees per hectare 20.9 Million tons Million tons

Farm value production is valued R 1.5 billion based on Farm value production is valued R 1.5 billion based on African union price structure.(Dept. AGRI state of African union price structure.(Dept. AGRI state of Hawaii 17/06/15)Hawaii 17/06/15)

Present proposal is for 225 trees per hectare- 6000ha Present proposal is for 225 trees per hectare- 6000ha (15-20yrs)(15-20yrs)

Project implementation Project implementation System based technology usingSystem based technology using

Incubation training Incubation training Geo-tagging and GIS system data captureGeo-tagging and GIS system data capture Remote sensing Remote sensing Recommendation and action technology Recommendation and action technology

Technology packaging Technology packaging Superior genetic planting material Superior genetic planting material Advanced irrigation and fertigation systems Advanced irrigation and fertigation systems Remote sensing Remote sensing

Project implementation Project implementation Operational centre of excellence Operational centre of excellence

Scientific and biological support Scientific and biological support Extension officer Extension officer Operation management Operation management

Processing and manufacturing Processing and manufacturing DryingDrying Cracking Cracking Separating and grading Separating and grading Roasting & Grading Roasting & Grading Salting and Packaging Storage Salting and Packaging Storage

Marketing Marketing

Two Fold Strategy Two Fold Strategy

Commercial agricultural unit 1000ha (5-10yr)Commercial agricultural unit 1000ha (5-10yr)Small scale Farmer development 30ha (1-2yr)Small scale Farmer development 30ha (1-2yr)Build the industry to 6000 ha (10-20yr)Build the industry to 6000 ha (10-20yr)

Development Development System Objective System Objective Rapid transformation from subsistence farming Rapid transformation from subsistence farming

into commercial producerinto commercial producer Systems that facilitate semi-skilled Extension Systems that facilitate semi-skilled Extension

officer in provision of high level applied officer in provision of high level applied agriculture expertise.agriculture expertise.

System implementation with rapid upscale System implementation with rapid upscale capacity for range of crops and location capacity for range of crops and location

Development System Objective Development System Objective Monitoring tools Monitoring tools

Yield Yield Risk management Risk management Client farmer evaluation and profile development Client farmer evaluation and profile development Production estimates Production estimates Quantification of interventions Quantification of interventions Across the board evaluation of implementation Across the board evaluation of implementation

agencies agencies Traceability of agriculture production Traceability of agriculture production Continuous capture of crop production and training Continuous capture of crop production and training

systems to improve project implementation systems to improve project implementation

Assumptions & Challenges Assumptions & Challenges Require a Require a Stable and non–corrupt governance Stable and non–corrupt governance

system system Income share of middle class is the key for a Income share of middle class is the key for a

stable democracy stable democracy Increase in income share of middle class Increase in income share of middle class

ensures equilibrium of taxes – potential of ensures equilibrium of taxes – potential of corruption and revolution decreases corruption and revolution decreases (Debs&Morrison 2015)(Debs&Morrison 2015)

Agricultural sector is a sector that accelerates Agricultural sector is a sector that accelerates broad- based economic development rapidly.broad- based economic development rapidly.

Assumptions & Challenges Assumptions & Challenges If Assumptions are correct?If Assumptions are correct? Main challenge is :-Main challenge is :- How to effectively utilise How to effectively utilise

agriculture to a create middle agriculture to a create middle class?class?

Challenges Challenges Small scale farmers developed need to compete Small scale farmers developed need to compete

with commercial farmers and global market in with commercial farmers and global market in short space of time.short space of time.

Key role of incubator is to protect the farmer until Key role of incubator is to protect the farmer until they are ready to take on global and commercial they are ready to take on global and commercial sector.sector.

Key challenges Key challenges Scale – General trend is to scale up larger Scale – General trend is to scale up larger

farming units farming units Steady production increase - High value crops Steady production increase - High value crops

need to increase yearly to maintain profit need to increase yearly to maintain profit Technical – Farming is Hi-tech business Technical – Farming is Hi-tech business

requires access to sophisticated technical requires access to sophisticated technical expertise expertise

Literacy/numeracy –Poor literacy numeracy Literacy/numeracy –Poor literacy numeracy skills skills

Subsidies -Small scale farming compete Subsidies -Small scale farming compete against 1against 1stst world subsidized farmers world subsidized farmers

Addressing Addressing Assumptions & Challenges Assumptions & Challenges

Focus on crops production systems capable of Focus on crops production systems capable of generating middle class income ($5000 -$20 generating middle class income ($5000 -$20 000)/ unit of land in terms labour and 000)/ unit of land in terms labour and management by a family unit management by a family unit

Incorporating Smaller unit of lands within same Incorporating Smaller unit of lands within same location into larger farming unit (30ha) location into larger farming unit (30ha)

Strategy Strategy Large number of people can empowered in a Large number of people can empowered in a

relatively small area. Reduction in bulk relatively small area. Reduction in bulk infrastructure, logistical and program infrastructure, logistical and program management challenges management challenges

If farm worked by family unit Reduce If farm worked by family unit Reduce management load on extension officer focus on management load on extension officer focus on aspects to increase growth and yield aspects to increase growth and yield

Increase social financial return per unit and block Increase social financial return per unit and block development development

Optimise agricultural resources for target blockOptimise agricultural resources for target block

Strategy Strategy Strategy is dictated that focus is on high value Strategy is dictated that focus is on high value

crops with significant profit margincrops with significant profit margin No simple answer to ensure small farms are No simple answer to ensure small farms are

competitive against first world markets competitive against first world markets Challenges are Challenges are

Advantage of scale Advantage of scale Subsidies Subsidies Technical expertise Technical expertise education education Infrastructure Infrastructure

Two Key Strategy Two Key Strategy Identify climate and agriculture recourse zones Identify climate and agriculture recourse zones

that provide farmer with significant advantages that provide farmer with significant advantages over competitors over competitors Climate that permit supply of product at a Climate that permit supply of product at a

different peak window different peak window Climate optimal for production Climate optimal for production Environment where input cost can be Environment where input cost can be

significantly reducedsignificantly reduced gravitational water over pumping gravitational water over pumping Correct soils -drainage ability to sustain long Correct soils -drainage ability to sustain long

term crop. term crop.

Two Key Strategy Two Key Strategy Integrated incubation and technology Integrated incubation and technology

packaging methodologypackaging methodology Eliminates challenges related to poor Eliminates challenges related to poor

literacy and no exposure to commercial literacy and no exposure to commercial agriculture agriculture

Produce a farmer better than Produce a farmer better than commercial counter parts commercial counter parts

Incubation & Technology Incubation & Technology Packaging Packaging

Incubation and mentoring is a familiar concept Incubation and mentoring is a familiar concept Technology Packaging is the game changerTechnology Packaging is the game changer

Developing and maintaining high value crop Developing and maintaining high value crop based farms yield needs to increase by 2-7 % based farms yield needs to increase by 2-7 % per annum maintain constant profits per annum maintain constant profits

Simply training farmers to produce crop in Simply training farmers to produce crop in static procedure will set the unit for failure static procedure will set the unit for failure

Sugar subsidy or favourable pricing is removed Sugar subsidy or favourable pricing is removed challenges to sustainability.challenges to sustainability.

Not been able to adapt to higher yield required Not been able to adapt to higher yield required to ensure profitability.to ensure profitability.

System integration System integration Software principleSoftware principle

Designed on Cloud Based Wizards and Data Designed on Cloud Based Wizards and Data capture.capture.

Similar to process found in software eg Microsoft. Similar to process found in software eg Microsoft. A wizard guides you through the complex process A wizard guides you through the complex process

producing a product following simple wizard producing a product following simple wizard generated instructions and recommendations.generated instructions and recommendations.

Enable Extension Officer and Farmers to make Enable Extension Officer and Farmers to make complex business and Production decisionscomplex business and Production decisions

System integration System integration Approach has a number of implications Approach has a number of implications

Farmers are empowered, no longer a restriction on Farmers are empowered, no longer a restriction on education or numeracy education or numeracy

Training environment Training environment Used in training farmer provides the input Software Used in training farmer provides the input Software

shows impact and effect of actions on farmer inputs shows impact and effect of actions on farmer inputs Facilitation ensures the farmer come to logical Facilitation ensures the farmer come to logical

conclusions by themselves conclusions by themselves half fertiliser = reduce cost but reduce in yield half fertiliser = reduce cost but reduce in yield

=reduction in profit=reduction in profit Result = greater buy in Result = greater buy in

System integration System integration Training environment cont.Training environment cont.

Prevents development of top down situation Prevents development of top down situation developing -Farmer is required to take developing -Farmer is required to take responsibilityresponsibility

Ensures farmer and trainer focus on critical Ensures farmer and trainer focus on critical concepts and not calculation the result concepts and not calculation the result

General farmers have difficulty converting theory General farmers have difficulty converting theory into practice.into practice.

Wizard adapts theory to the specific situation Wizard adapts theory to the specific situation returns practical quantified easy to follow returns practical quantified easy to follow instructions instructions

All data entered is captured in the cloud utilized to All data entered is captured in the cloud utilized to improve farmers production improve farmers production

Advantages Advantages Applicable to most crops rapid roll out in wide range of Applicable to most crops rapid roll out in wide range of

scenarios and location scenarios and location Each project adds more information to cloud base result Each project adds more information to cloud base result

in automatic improvements in automatic improvements Decisions recommendations are data based fundamental Decisions recommendations are data based fundamental

logic is the same algorithm base logic is the same algorithm base Technical expertise are captured by the system reduction Technical expertise are captured by the system reduction

of the technical expertise required by extension officer of the technical expertise required by extension officer and farmer to manage program and farmer to manage program

Day to day interaction conducted by the community Day to day interaction conducted by the community reduction in cost reduction in cost

Salaries are based on local norms not foreign based tariffsSalaries are based on local norms not foreign based tariffs

Incubation Incubation Key aspect provide a safe environment where Key aspect provide a safe environment where

farmers have time to develop skills to compete farmers have time to develop skills to compete with commercial farmers with commercial farmers

As number increase it becomes an impossible As number increase it becomes an impossible task to manage task to manage

The systems monitor farmer progress against The systems monitor farmer progress against recommendations made by system recommendations made by system

Any deviation beyond set limits automatically red Any deviation beyond set limits automatically red flags flags

Permits rapid focused intervention before serious Permits rapid focused intervention before serious financial loss can be incurred financial loss can be incurred

Additional Benefits Additional Benefits Can objectively rate score farmers Can objectively rate score farmers Automatically generate reports to funders Automatically generate reports to funders

financial institutions at any level of detail financial institutions at any level of detail Evaluate social & economic impact of project Evaluate social & economic impact of project

against resources spent against resources spent Evaluate project implementation agencies based Evaluate project implementation agencies based

on impact on ground and is transparent unbiased on impact on ground and is transparent unbiased criteria criteria

Technology packaging Technology packaging Superior plant genetics Superior plant genetics

Through a centralised nursery based in South Africa.Through a centralised nursery based in South Africa. Micro-grafted plants are supplied to be grown on in Micro-grafted plants are supplied to be grown on in

satellite nursery environment satellite nursery environment Only basic knowledge of nursery management Only basic knowledge of nursery management

required required Ensures prime genetic selection for area an location Ensures prime genetic selection for area an location Reducing technical knowledge and limited genetic Reducing technical knowledge and limited genetic

material requirements material requirements Ensures rapid scalability of planting stock in a short Ensures rapid scalability of planting stock in a short

time period 100 000 micro-grafts in 6 months time period 100 000 micro-grafts in 6 months

Technology packaging Technology packaging Conventional nursery enterprise will delay project Conventional nursery enterprise will delay project

implementation by 4 years related to implementation by 4 years related to seed source seed source grafting material in large scale grafting material in large scale technical expertise technical expertise LogisticsLogistics

ROOT STOCK MICRO

Grafted Seedling

Mature tree seedling ready for planting 18mnths

Technology packaging Technology packaging Highly advanced irrigation and fertigation system Highly advanced irrigation and fertigation system

Utilising water resource optimally low flow drip systems Utilising water resource optimally low flow drip systems incorporated incorporated

Open hydroponic fertigation system based on Open hydroponic fertigation system based on Wizard recommendation determine by Wizard recommendation determine by

growth phase growth phase soils characteristics soils characteristics leaf samples leaf samples data capturing requirements data capturing requirements

Remote sensing Remote sensing data acquisition and monitoring data acquisition and monitoring Geotaging and GIS for plant health scouting trainingGeotaging and GIS for plant health scouting training

Conclusion Conclusion Our system has been tried and tested in Our system has been tried and tested in

commercial agriculture and small scale sector commercial agriculture and small scale sector The work has demonstrated that middle class can The work has demonstrated that middle class can

rapidly evolve from subsistence to middle class rapidly evolve from subsistence to middle class Commercial agriculture can rapidly improve yield Commercial agriculture can rapidly improve yield

and reduce production cost and increase profit and reduce production cost and increase profit with a reduced skills base with a reduced skills base

Ensures rapid cost effective implementation of Ensures rapid cost effective implementation of incubation projects for commercial and small incubation projects for commercial and small scale projects scale projects

Conclusion Conclusion Provides support to ensureProvides support to ensure

Logical frame work for implementation Logical frame work for implementation optimal farmer development optimal farmer development crop production crop production evaluation evaluation

The increases in production blocks ensures that The increases in production blocks ensures that the same key fundamental and data acquisition is the same key fundamental and data acquisition is used effectively for all production units in the used effectively for all production units in the future.future.