The Country Manager, AFEX Commodities Exchange Limited, Ayodeji Balogun, has lamented that the non-application of technology in Nigeria’s agriculture constituted a major problem in the sector.
He said this while speaking at a one day workshop with the theme; ‘#CodeCashCrop’ organised by AFEX Commodities Exchange Limited in Lagos.
According to him, AFEX is poised to step up the required connection between the agricultural ecosystem and the financial ecosystem, saying that there are investors that currently require exposure to multi-asset classes but currently do not have a robust portfolio because the market is only around the money and the equity market.
“What the commodity exchange does is to create agricultural assets and de-risk them such that they are investable and bring it up for wholesale and retail investors that want to play in that space.
“What we have done over the last four years is to go right into the interior farming communities across the country and build storage facilities to preserve wealth created by farmers.
“We have employed our farmers into groups to farm so that when they harvest there is an already established market to sell. We have built that agricultural ecosystem. We have invested heavily in technology, having an exchange trading platform running live now, where traders, buyers and financiers can connect remotely from wherever they are and then transact. What we see as the future is the connection with the new financial ecosystem and technology is the enabler to bring that marriage between finance and agriculture to fortune,” he added.
Speaking further Balogun stated that AFEX is looking at the opportunities that are involved when finance, agriculture and technology that before now works individually come together to procreate and co-think around the problem within the space and more importantly around the solutions and to bring business opportunities.
“We see a new asset class being built. Technology brings efficiency to agriculture while agriculture brings opportunities for tech”, he added
Contributing, Akinyinka Akintunde explained that the essence of the workshop is how to leverage technology efficiently in agriculture, saying that mechanised agriculture focuses on how farmers farm more to increase yield and aggregating funding into the agriculture sector.
Adeline Fabre, a Partner at Choiseul Africa, said that agriculture was the next big thing in Nigeria and Africa, not because of fall in oil prices but because of the potentials in the sector.
She expressed optimism that the application of technology in agriculture could enable the value chains to work efficiently and that with more data on the sector, the value chain could work while transparency and trust would be engendered, thereby linking farmers to investors.
Ayomide Akindolie of Dalberg, a group of firms that focuses on international development, noted that the firm does a lot of work in the agricultural space.
He observed that the key discussion at the workshop is basically about how technology can address challenges in the agricultural value chain and facilitate access to finance either using technology or essentially improving the profiles of some of the farms and farmers that are working in the agricultural space.
On some of the challenges, Akindolie identified infrastructure deficit as the chief among the problems facing the sector.
She said though a lot of people are coming up with innovations to address the issues and challenges in the agricultural space but stated that road networks is also a fundamental issue that needed urgent attention.
“If you come up with amazing technology to connect farmers in Northern Nigerian to a market in Southern Nigeria, but what happened when they are getting the produce out of the North to the South and the truck breaks down because of bad roads or what happens when the cost of just transporting the produce from the North to South is more than the cost of the produce itself. These are fundamental challenges.
“We need to get to the point where they are resolved so that other initiatives that are been spearheaded by exciting people in the space will have maximum impact,” she added.
