Group Contract Farming Initiatives
Strategic Approach
Continued strategic investment into and empowerment of Zimbabwe’s agricultural sector is a critical success factor to ensure the future sustainable growth of our milling, baking and protein businesses which are reliant on the local agriculture sector.
Key Statistics
- The Group is the largest single buyer of maize in the country
- The Government’s target is that a business should fund 40% of its grain requirements
- Target to grow at least 50% of the Group’s grain requirements in maize, soya, wheat and sorghum
Paperhole Investments (PHI)
Commodities Crop Schemes
Following the liberalisation of the marketing of wheat and maize in 2009 by the Government of Zimbabwe, a new era of opportunity was ushered wherein PHI could purchase and participate at the primary source.
Inevitably in order to bridge the local production gap as well as reduce the import bill, PHI commenced contract farming schemes in the summer of 2010/2011 cropping season.
The schemes entailed signing up potential farmers under a tripartite agreement with a seed house. The ultimate goal was to capacitate farmers to improve hectarage under plantation as well as yields. Hectarage farming under plantation has registered a tenfold growth, starting at 1 000 hectares (ha) of maize and soya bean at inception in 2010 to 11 000 hectares of a variety of crops for the 2021/2022 season. Planning is already well advanced to increase the summer plantings of these two key crops from the 11 000 hectares grown in the summer of 2021/2022, to 20 000 hectares in the summer of 2022/2023. Crops under the scheme have also widened to include wheat, popcorns, sugar beans and table potatoes. PHI has also set aside hectarage for specialised production of seed maize.
In line with government policy under the National Development Strategy 1 and more specifically, the Agriculture and Food Systems Strategy, PHI also aims to increase production from both the Contract Farming and Corporate Farming divisions. Strategic crops such as maize, seed soya beans and soya beans, will be key focus area with a target minimum hectarage of 40 000 hectares over the next three years.
Impact to the community
PHI compliments government efforts of empowering and tooling the small-scale farming sector. Our various projects boost the livelihoods of communities and assists in poverty alleviation and the reduction of social ills. The projects also facilitate skills transfer and capacitation. Some of the districts who have benefited from the PHI contract structures include the small-scale maize scheme supports over 200 families in Chiweshe District.
Corporate Farming
Under the Corporate Farming Division, PHI’s first season of Corporate Farming was in 2016, when it partnered with two young farmers and three land reform beneficiaries under a joint venture agreement in the Doma District. The joint venture started off on 570 hectares of maize. The joint venture partners benefit from the investment in irrigation equipment, equipment and machinery as well as being able to learn from and understudy the professional management on each farm. The first of these joint venture agreements is now six years old and has been renewed by mutual agreement.
PHI has now expanded its farming operations on to six separate farms, with over 2 300 hectares of land under pivot. The farms are cropped at least twice annually, producing maize, seed maize, soya beans, wheat, and table and seed potatoes. The entire hectarage is in joint venture partnerships with beneficiaries of government’s Land Reform Programme. For the current season, the division is expected to produce 8 000 tonnes of commercial maize, 1 200 tonnes of commercial soya beans in addition to substantial tonnage of seed soya beans.
Additional hectarage has already been secured for the summer of 2022/2023 adding a further 900 hectares to this Division.
Potato Handling and Storage
The division is expected to plant 1 300ha of potatoes, producing 65 000 tonnes of quality table potatoes. To support the planting, PHI was instrumental in the formation of a specialised entity to handle and store potatoes.
The grading unit, under Sabithorn, mechanically grades and packs up to 180 tonnes of potatoes a day, which are stored in specialised cold rooms with capacity of up to 4 000 tonnes of potatoes. This ensures quality product supply all year round.
Livestock
To compliment the row crop operations, PHI started a Livestock Division in 2019. The Division operates from a Joint Venture farm in the Shamva District, adjacent to a rented abattoir and aims to slaughter up to 300 animals per week.
The Division is building up its own breeding herd of Mashona cattle to ensure a supply of quality animals each year to fatten on an established permanent pasture and in its own fattening pens. It has a team of experienced cattle buyers who buy communal and resettlement cattle and arrange transport for the cattle to the abattoir. The abattoir encourages private producers to also deliver their cattle to the abattoir for sale or toll slaughter.
PHI operates two Cattle Business Centres, with the local communities in the Dotito and Mayo Districts, where cattle are aggregated for transport to the abattoir.
PHI is working with the local community and the BEST Project partners to develop these Cattle Business Centres so that local farmers can pen feed their cattle there, purchase hay bales, cattle and stock feeds and vet products.
Fertiliser and Crop Chemicals
Because fertiliser and agricultural crop chemicals are an important input into farming, PHI established a world class fertiliser blending plant in Harare – Nutrimaster. Nutrimaster also manages the procurement of nitrogen fertiliser and has the registration for a number of key crop chemicals.
Key Business Highlights
- Increased hectarage from 1 000ha to 11 000ha for variety of crops planted
- Target to increase to approximately 20 000ha for 2022/2023 season
- Targeted minimum hectarage over the next 3 years is 40 000ha
- Joint Venture partnerships with beneficiaries of the Government’s Land Reform Programme with over 250 contract farmers expanding to a remarkable 2 300 ha of farming under pivot irrigation from 570 ha
- PHI Farming operations apply conservation agriculture with mulch techniques over a 3-year cycle are already showing signs of benefiting the prospective yield per ha
- Prioritises conservation agricultural over conventional agriculture techniques
- Developed a very high-quality seed industry in the country
- The Blueberry Project produces export quality blueberries with the farms being Global GAP Compliant with regular audits being done
- 80% of the workforce of the Blueberry Project are women
- Proudly developed together with Agritex a solid system producing credible data for use by the authorities
- Small-scale maize supports over 200 families in the Chiweshe District
PHI is also targeting to increase the winter wheat plantings to 20 000 hectares over the same period thus satisfying the ultimate objective of the Group to produce at least 50% of its row crop needs. In 2021 PHI financed 4 900 hectares of commercial wheat contract farming and increased this to 13 200 hectares in 2022. Total wheat tonnage for delivery to National Foods Flour Mill in September to December 2022 is 78 000 tonnes or nearly 40% of the total national crop production.
Contract Farming Schemes
Since the inception of the Contract Farming scheme, PHI has recorded recognizable milestones in both hectarage under plantation and yield improvement. In the 2021/2022 summer season PHI financed farmers to grow 3 500 hectares of fully irrigated maize, with an average yield of 8 tonnes per hectare, 2 800 hectares of rain-fed maize with an average expected yield of 5.5 tonnes per hectare, producing in total 44 000 tonnes of maize. PHI also financed 300 hectares of seed maize, 80 hectares of popcorn, 38 hectares of potatoes, 3 700 hectares of soya beans and 400 hectares of seed and commercial sugar beans.