Much attention is being focused on Gabon’s rural areas and on developing the country’s roughly 5m ha of fertile land. While it is has one of the lowest population densities in sub-Saharan Africa, according to the Ministry of Agriculture, around 86% of the country’s 1.8m inhabitants have opted to live in the major urban centres – namely Libreville, but also Port-Gentil and, to a smaller extent, Franceville.
Urbanisation has been driven in large part by development of the country’s energy industry over the past 60 years, and the decrease in the size of the country’s rural population has been mirrored by lower agricultural production and revenues.
A Key Sector
Developing the sector is a key part of the Emerging Gabon Strategic Plan (Plan Stratégique Gabon Emergent, PSGE), announced by the administration of President Ali Bongo Ondimba’s in 2009. The plan establishes the foundations for the country’s economic diversification strategy. In addition to the goals listed in the PSGE, the government pledged in 2011 to increase agriculture’s contribution to GDP from its current level of around 5% to 20% and achieve food self-sufficiency by 2020.
After growing by 7.1% in 2014, the agriculture, livestock and fishing sector expanded by 8.9% in 2015, according to the General Directorate of Economic and Fiscal Policy. The sector accounted for 4.4%, or CFA236.6bn (€354.9m), of GDP in 2015. This was an increase from 4.2% of GDP in 2014. Sector employment, meanwhile, increased by 10.6% to 10,802 workers in 2015, up from 9765 the previous year.
Stronger growth in 2015 was mainly attributed to an increase in output due to deployment of the Agricultural Development and Investment Project (Projet de Développement et d’Investissement Agricole au Gabon, PRODIAG) across all provinces, which boosted the development of arable land and improved productivity. The addition of Awala Olam’s oil palm plantations, which entered into production in the fourth quarter of 2015, and the performance of livestock activities in Moulengui Binza in Nyanga were also key contributors to growth over the year.
With the introduction of various public and private initiatives and projects to boost the sector’s workforce and improve its cultivation methods, tools and attractiveness, Gabon is on the right path towards achieving the goals set out by the PSGE – namely sustainable economic growth and diversification. However, more work and further investment will be required to achieve self-sufficiency.
The year 2015 and the first two quarters of 2016 have largely been a holding pattern for the agricultural initiatives, as growing crops from scratch requires a certain waiting period. Additionally, lower international energy prices have led to lower revenues for the government, a key co-financier of many of the sector’s most important projects.
While sector activity has declined over the past few decades, following the discovery of oil in 1956, agriculture in Gabon remains much more than a simple dichotomy between traditional small farming and high-yield industrial production.
In a 2015 report the Ministry of Agriculture identified five different types of farming activities in Gabon, depending on the size of the operation. However, the exact number of each type is more difficult to obtain, as no comprehensive national survey has been conducted in some years.
The backbone of the agriculture sector in Gabon is primarily made up of subsistence smallholder farmers in the country’s rural hinterlands. The Ministry of Agriculture estimates that there are around 70,000 farms of this nature, encompassing a population of approximately 150,000 people. Such farms are between 1 and 2 ha in size, and they primarily cultivate plantain, cassava, taro, yam and various other vegetables. In addition, local husbandry is also practised at a relatively small level in family compounds.
In less rural areas, private individuals – namely active and retired civil servants – cultivate fruits and vegetables on medium-sized private farms. As no census has ever been conducted on this type of farming, it is difficult for the Ministry of Agriculture to estimate the size of this category, which also includes private medium-sized rubber plantations (no smaller than 10 ha) and small palm plantations.
Small farms began developing on the outskirts of urban centres, particularly near Libreville, around the same time that the country started experiencing high urbanisation rates and an increase in domestic demand for fresh produce. There are some initiatives in place that provide technical assistance and training to peri-urban agriculture, particularly in the suburbs of Libreville. However, the majority of these 2000-3000 small farms remain unregulated and receive no formal assistance at present.
Prior to the country’s independence from France in 1960 small village plantations and animal farms began operating following the introduction of new cash crops such as coffee, cocoa and palm oil. These farms were on the outskirts of agro-industrial sites as satellite operations, with agro-industrial operators ensuring adequate levels of technical and maintenance support to those communities. However, following the collapse of a number of these operators due to liquidation or privatisation, the future of these plantations became more uncertain.
In 2004 the Belgian operator, Société d’ Investissement pour l’Agriculture Tropicale (SIAT), bought the failing companies, bringing support to palm oil and rubber tree plantations in five key areas – namely, Bitam, Mitzic, Oyem, Minvoul and Kango.
Between 1977 and 1985 the government used its oil revenues to develop public-private partnerships (PPPs) and create joint ventures (JVs) with multinational agro-industrial operators to produce sugar, plantain, palm oil, rubber, poultry, cattle, fruits and vegetables. SIAT Gabon, the local subsidiary of Belgian SIAT, has led the market for palm oil, rubber tree and cattle meat since 2002, while Sucrerie Africaine du Gabon (SUCAF Gabon) is the dominant sugar producer. Singapore-based Olam International, which entered the market in 2010 through a JV with the government, also produces palm oil.
The local palm oil industry is increasingly viewed by the government as a key component capable of driving growth in the sector. As of June 2016 SIAT Gabon continued to account for the largest share of production, operating some 7500 ha of plantations around Makouké in the Moyen-Oogoué Province in central Gabon and employing around 1000 workers. According to SIAT’s 2015 annual report, the production of raw material for palm oil increased by 12% in 2015, and the company’s Lambaréné refinery processed a total of 9191 tonnes of crude palm oil that year. The company’s imports of palm oil, meanwhile, amounted to 3178 tonnes, less than the 5000 tonnes of imports that had been predicted for the period. At present, SIAT is continuing to prioritise the expansion of its rubber production over that of palm oil. In late 2016 the firm’s palm oil business was acquired by Olam International, whose palm oil plantations now span a total of 58,000 ha.
A major factor determining the oil extraction ratio is the quality and ripeness of the fresh fruit bunch. According to Olam officials, the firm expects to produce palm with an extraction rate of 24%. Olam Palm Gabon and its newly acquired palm oil plantations are expected to produce 290,000 tonnes of oil. Prior to the acquisition, Olam Palm Gabon farmed 50,000 ha of palm oil, with their first harvest taking place in August of 2015, followed by a second in April 2016.
The company has embarked on a PPP called the Gabon Initiative for Achieving Agricultural Outcomes with Engaged Citizenry (Gabon des Réalisations Agricoles et des Initiatives des Nationaux Engagés, GRAINE), which has seen 42,000 ha allocated for smallholders and 28,000 ha to industrial plantations. An additional 8,000 ha has been allotted to domestic crops, such as cassava, bananas and manioc. According to Faizal Malthunni, project director of GRAINE, the company’s goal is to produce 350,000 tonnes of palm oil – a rate of 5 tonnes per ha.
Phase II of the project aims to develop an additional 120,000 ha of palm oil plantations. “The fact that the GRAINE programme was conceived as a PPP illustrates the fact that more private participation in key sectors is crucial to achieving diversification efforts and developing private sector investment,” Gagan Gupta, country head of Olam, told OBG.
Rubber production is also receiving a fair share of attention, with SIAT focusing a lot of its efforts on boosting its rubber production in Gabon. The company intends to develop a total of 30,000 ha of rubber tree plantations as part of a 10-year planting programme. With approximately 13,000 ha at present, the company plans to plant 2000 ha per year as part of the CFA200bn (€300m) investment programme signed with the government. This adds to the 3000 ha SIAT planted between 2014 and 2016 as part of this programme.
SIAT’s current factory enables it to process 20,000 tonnes of dry rubber per year based on an annual production capacity of some 40,000 lumps of raw material. “Reaching 30,000 ha would push us to build a new factory between Kango and Lambaréné,” Gert Vandersmissen, the COO of SIAT, told OBG. “We would aim to do so by 2020.” As there are no tyre factories in Gabon, all of the rubber produced in the country is exported to Europe, the US and Latin America.
Olam, meanwhile, is still in the initial stages of rubber production, having planted around 8000 ha in Bitam, near the border with Cameroon, as of May 2016; however, rubber is a long-cycle crop, with a cycle lasting between seven and nine years. The company also plans to construct of a 20-tonne processing factory near its plantations in Bitam.
To refocus national efforts on developing the sector, the Gabonese government announced a new strategic roadmap for agricultural development – the National Plan for Agricultural Investment and Food and Nutritional Security (Plan National d’Investissement Agricole de Sécurité Alimentaire et Nutritionnelle, PNIASAN) during a workshop in March 2015. The plan has technical and financial support from the World Bank, the UN Food and Agriculture Organisation (FAO) and CEMAC ,and foresees total investment of approximately CFA400bn (€600m) between 2015 and 2020.
PNIASAN relies on six different segment-specific programmes to boost development of the sector: grain and vegetable cultivation, husbandry, promotion of the fishing industry, reinforcement of local capacity to sustainably manage natural resources, improving food and nutritional safety, and strengthening the sector’s institutional framework.
The overall objective of the plan is to enable 6% annual growth in the agricultural sector by 2020 and achieve a 15% reduction in food insecurity by 2018. More broadly, PNIASAN also aims to significantly reduce the country’s heavy dependence on imported goods – which some local media outlets report to be approximately CFA300bn per annum (€450m) – as well as support economic growth and help reduce poverty by boosting employment in the sector.
The Gabonese Institute for Development Support (Institut Gabonais d’Appui au Dé veloppement, IGAD) was founded in the early 1990s and charged with using the country’s energy revenues to reduce imports and oil dependence, as well as provide economic and social opportunities to unemployed urban youths. IGAD is the result of a PPP between the Gabonese government and Total Gabon, the Gabonese subsidiary of the French oil and gas multinational, with the international NGO AgriSud International providing technical assistance.
In 2011 IGAD launched the Agricultural Development and Investment Project (Projet de Dé veloppement et d’Investissement Agricole au Gabon, PRODIAG), with 80% funding coming from the French Development Agency (Agence Française de Dé veloppement, AFD) – through a debt conversion agreement the agency has with the Gabonese government – and the remaining 20% coming from the government. The project’s goal is to promote the commercialisation of peri-urban agriculture, support higher crop production through cooperatives and develop husbandry, especially poultry and pig farming.
“PRODIAG allocates land and divides it into cooperatives,” Pascal Pommarel, director-general of IGAD, told OBG. “There are five to 15 producers per perimeter, and each perimeter has an initial surface of 1 ha, with 2 ha of reserves to expand if needed,” he added. The project also provides two-week land management training courses. Participants are trained to implement PRODIAG’s land development roadmap, which details the techniques, such as fertiliser or machinery, to be used on the land at certain times.
As of May 2016 PRODIAG had supported 850 sustenance farms, 30 animal farms and 40 food-processing plants. Sustenance farms followed by the PRODIAG project produced a cumulative 6565 tonnes of 21 products in 2015, including high-yielding goods such as amaranth, tomatoes, celery, sprouts and lettuce. Total production was worth CFA2.37bn (€3.6m) that year, according to PRODIAG data. By far, the two most profitable products were plantain, which yielded 2822 tonnes worth CFA1.34bn (€2m), and cassava, yielding 3103 tonnes and CFA698m (€1m). Amaranth, meanwhile, returned 167 tonnes worth CFA58m (€87,000), followed by lettuce and tomato crops, with 94 tonnes and CFA61m (€92,000), and 89 tonnes totalling CFA36m (€54,000), respectively.
Of the 30 animal farms PRODIAG was working with in 2015, 15 were poultry farms and 15 were pig farms. Together, the poultry farms produced 801 tonnes of eggs in 2015, along with 115 tonnes of chicken meat, while the pig farms produced a total of 72 tonnes of pork meat. Cumulative income from animal farms amounted to CFA1.69bn (€2.5m), with 81.5% of this comprising egg sales, while sales of both chicken and pork meat accounted for CFA312m (€468,000).
While the project is scheduled to be brought to its conclusion around the beginning of 2017, the government, together with the AFD, expects to extend and expand it throughout the country’s nine provinces.
A second large project undertaken to support and develop the sector is GRAINE. The five-year project, which aims to foster agricultural entrepreneurship, was launched in December 2014 by SOTRADER, a JV between Olam International (49%) and the Gabonese government (51%). The project’s ambition is to create and develop agricultural cooperatives throughout the country’s nine provinces and facilitate the birth of a new generation of productive agricultural entrepreneurs.
The project’s target is to reach 200,000 ha of land under cultivation and create 20,000 jobs by 2020. The hectarage will be split between small producers (120,000 ha) and industrial use (80,000 ha). As of November 2015, GRAINE had distributed 54 land titles, totalling 6367 ha. The project comprised 425 cooperatives across the five provinces of Ogooué- Ivindo, Woleu N’tem, Haut-Ogooué, Ogooué-Lolo and Ngounié, which translated to roughly 6900 participants, according to a GRAINE activity report. Each cooperative includes between 15 and 30 farmers, depending on the type of crop. “The land is loaned to the farmers, with repayment schemes stretching over five years, with a 5% profit take-back once the crops become commercially viable on the local and/ or international market,” said Mathunni.
By 2018 the GRAINE programme intends to have around 70,000 ha dedicated to palm oil production and some 8000 ha for day-to-day crops, such as bananas and cassava. “Currently, we are at the early stages of the project, where most of the crops we want to introduce in the first phase have been planted,” said Mathunni. “It takes some months to harvest them, so the first results will be available in the coming months,” he added.
GRAINE focuses on helping farmers re-group in cooperatives, negotiate with the government, seek financing and acquire land – from 4 to 7 ha, depending on the size of the co-operative. GRAINE guarantees the sale of all farm products to smallholders, while the government provides $200 per cooperative member, per month, for the first year, to incentivise enrollment in the programme.
The cooperatives focus on farming for the local market through initial development of tomatoes, peppers, bananas and cassava plantations, as well palm oil production, which will be sold internationally. This will enable the country to progressively become more self-sufficient, but also, through the exportation of higher-value goods, contribute to reducing the economy’s dependence on oil revenues.
While initiatives such as GRAINE and PRODIAG are continuing to take steps to boost the domestic production of certain types of vegetables and grains, the three main cereals consumed in Gabon – wheat, rice and maize – are all imported.
The Société Meunière et Avicole du Gabon (SMAG), a subsidiary of the Société d’Organisation, de Management et de Développement des Industries Alimentaires at Agricoles (SOMDIAA) – a privately owned French agro-industry conglomerate – was the country’s sole importer of wheat and the only producer of wheat flour until 2015.
SMAG, which benefits from import and transport subsidies, imported around 90,000 tonnes of wheat in 2015, or 97% of the national total, primarily from France but also from Canada. Its factory in Libreville has an 80% yield, meaning that for every 100 units of wheat, it can yield 80 units of flour. Thus, with 90,000 tonnes of wheat, SMAG produces approximately 70,000-72,000 tonnes of flour a year, meeting close to all of domestic demand of around 75,000 tonnes per year (see analysis). SMAG also exports roughly two-thirds of the 17,000-18,000 tonnes of bran it produces each year, primarily to Morocco.
However, the Gabonese wheat market is set to see some changes with the arrival of Foberd Gabon, a local subsidiary of Cameroon’s Fokou Group, in 2015. The company’s mill, which specialises in producing wheat flour, semolina and cattle feed, currently produces 150 tonnes of wheat per day out of a total capacity of around 300 tonnes (see analysis).
The opening of the flour market to competition should result in the lifting of state subsidies on prices, which hovers around CFA14,950 (€22.43) per 50 kg, according to SMAG. “These last months the price of wheat fell to a level close to the subsidy threshold,” Bruno Lardit, director-general of SMAG, told OBG. “If the subsidy system ends now, this will therefore have a limited impact on operations or the end consumer, but margins might be squeezed if prices go up again without accompanying measures. The challenge faced today is that subsidies have not been paid for months, weakening our cash flow.”
SMAG also produces roughly 27,000-30,000 tonnes of animal feed per year, with about a quarter of that production dedicated to the firm’s egg-laying hens at their N’Koltang farm in 2015. The rest is sold locally, mainly to small poultry and pig farmers, as well as fish farms to a lesser extent.
With PRODIAG’s first egg production coming on-line in 2013, there are now a number of egg producers in Gabon in addition to SMAG, which, with a 35-40% share of the market, maintains the largest output by far. The company’s annual production is currently around 43m eggs, whereas all the projects under PRODIAG produced a combined 961 tonnes in 2015 – or roughly 15m-16m large eggs, using a base estimate of 16,000 large eggs per tonne.
Domestic demand for meat is almost entirely met by imports. “Meat is expensive to produce in Gabon and less competitive than imported produce,” IGAD’s Pommarel told OBG. That said, small-scale production of chicken and pork meat is common in Gabon, but mostly for personal consumption or for sale on local markets.
SIAT Gabon operates the country’s only industrial abattoir but is looking to build another in Libreville or Owendo, as well as a butchery in Libreville for packaged meats, as part of a CFA314bn (€471m) investment programme through to 2025.
In 2015 SIAT sold around 1000 pieces of cattle, representing 200 tonnes of meat, through its 100, 000-ha ranch in Nyanga. The firm is working to reach full capacity at its ranch to meet its 25% market share target. According to SIAT, the volume of the local fresh meat market is roughly 80,000 tonnes per year.
Meanwhile, PRODIAG is also taking steps to develop poultry and pork capacity. In 2015 farmers under the project produced around 115 tonnes of poultry meat and 72 tonnes of pork meat.
Despite efforts to boost domestic supply, further development of the local livestock segment will likely continue to be hindered as long as taxes on meat imports are absent, exposing the market to more competitive meat from South Africa and Brazil.
In 2015 Gabon produced around 23,500 tonnes of sugar – of which 22,500 tonnes was refined product and 1000 tonnes was brown sugar. SUCAF Gabon, a local subsidiary of France’s SOMDIAA, is the country’s sole sugar producer, relying exclusively on its 5100-ha plantation close to Franceville, which also has on-site refining. The year 2015 was a challenging one for the sugar segment. While SUCAF’s operations have been protected through a sugar import ban, and prices have been fixed since 1998, the firm has been operating at a loss for the past four years.
The total sales volume of sugar in 2015 was 800 tonnes less than in 2014 and 2000 tonnes below target, according to SUCAF figures. “Sugar production was negatively affected by an unseasonably long dry spell of four months without rain,” Christian Renardet, SUCAF’s director-general, told OBG.
Prospects for sugar output are more positive for the coming growing season, after a new, higher-yield seed variety was planted in 2016. Sugar cane output of 315,000 tonnes is expected in 2016, up 7.5% over the 293,000 tonnes recorded in 2015, with an estimated 26,000 tonnes of sugar to be produced.
Gabon is one of the highest consumers of fish in sub-Saharan Africa, according to the UN FAO. While the country’s production potential is estimated at 200,000-300,000 tonnes of fish per year, development of the domestic industry has been hindered by insufficient infrastructure and a lack of financial support. In addition, the government needs to tackle illegal fishing by improving its mechanisms to enforce the country’s fishing regulations.
In 2015 the government estimated that industrial fishing and small-scale fishing produced a combined 42,000 tonnes of fish – up from approximately 38,000 tonnes during the 2005-07 slump, but nevertheless down 63.7% from a peak of 65,900 tonnes per year between 1998 and 2000.
For the fishing sector to grow, more investment is needed to support the acquisition and maintenance of fishing vessels, as well as to expand the capacities of the country’s small coastal harbours. Under PNIASAN, a total of CFA45bn (€67.5m) has been allocated to support the sector – divided between funding for vessel purchases and maintenance, and training and mechanisms to improve processing capabilities. However, it is unclear whether the funding has been distributed as yet.
A better tax regime, which currently consists of 20-30% in value-added tax and an undisclosed amount of Customs duties, will also be required to help develop the domestic fishing and aquaculture sector, particularly given the Ministry of Agriculture and Livestock’s projection that domestic demand will rise to 55,000-65,000 tonnes per year by 2020.
As of 2015 it is estimated that just 14% of Gabon’s population lives in rural areas, according to Jean-Louis Moubamba, senior agro-economist at the African Development Bank. Furthermore, around half of this segment is aged 60 or over. As a result of this – with increasing evidence pointing to a generation gap since the country’s urbanisation boom between the 1960s and 1980s – the country is lacking an active rural workforce. “Today’s younger generation has seldom lived outside of urban areas,” said Christian Mbina, the technical director of the National Agency of National Parks. “Their parents have seen their own parents work the land, but thanks to the first oil discoveries, these parents took on office jobs, and their children have been growing up with the idea that the only good job is a white-collar job,” he added.
“Boosting employment in the rural sector starts with changing the social image of the agriculture worker,” Jean-François Cornu, loan officer for the AFD in Gabon, told OBG. “They are not poorly educated people living in isolation on their land.” GRAINE has been working to tackle this perception issue head-on through advertising campaigns that convey the image of farmers as entrepreneurs.
However, another challenge in terms of developing a rural workforce is a lack of training facilities. “Some 80-85% of youths in schools are not trained for manual labour jobs, so it is difficult to find qualified workers in the agricultural sector,” Moubamba said. From a forestry operator’s perspective, the cost of labour is also a key consideration. At around CFA150,000 (€225) per month, labour remains more expensive in Gabon than in many surrounding countries.
“To clear out a 1 ha piece of land, you’re looking at spending CFA500,000 (€750), if it’s done exclusively with local workers,” said Pommarel. “Mechanisation of the task would cost a lot less,” he added. However, with forests accounting for the majority of the country’s terrain – at around 85% – it is difficult for agricultural plots to accommodate such machines.
Nevertheless, the GRAINE project has already been taking steps towards promoting mechanisation as a means to improve the sector’s appeal, efficiency and costs. Operating machines requires training and renders some agricultural jobs more technical rather than solely manual. In the eyes of the government, this could help make the sector a more attractive proposition to a younger and more educated generation.