Joint ventures to boost citrus production

TWO agriculture investors in Chegutu, Mashonaland West have embarked on a joint venture project in the citrus sector with farmers, which could significantly boost production with the Chinese market beckoning.
Zimbabwe recently signed a trade protocol with China on citrus trade, opening up the Asian country’s huge market for potentially other Zimbabwean horticulture products as well.
The two companies, Dodhill Nursery and Sable Park Estate say the venture will grow Zimbabwe’s citrus industry significantly. Dodhill is the only internationally-certified citrus nursery in Zimbabwe.

“Land is key to the growth of the citrus sector and that land in Zimbabwe, the majority of it, is state-owned agriculture land. The companies have engaged the government through the ministry of Agriculture to engage farmers in Chegutu under a hub and spoke model,” chief project advisor, Rangu Nyamurundira, told The Financial Gazette this week.
“We have identified two farms which are the hubs, that already have citrus orchards and the requisite expertise. They are then incorporating farmers neighbouring those two hubs.
“They will secure at least 50 hectares of land on that A2 farm and then establish citrus orchards, which then allows the farmer to continue doing other activities on the remainder of the land. That 50 hectares will become a commercially run enterprise,” he added.
A2 farms engage in medium-scale commercial agriculture.
According to Nyamurundira, Dodhill and Sable will provide the expertise and management of the citrus for the first 10 years.
“So, this is a commercial arrangement between the local investors, Dodhill and Sable Park, the farmer and the ministry.
“They have secured an investment licence from Zida (Zimbabwe Investment and Development Agency). The licence protects the investment.
“We also have joint venture agreements between the investor and the farmers, which have been undersigned by the ministry and are valid for a 30-year period.
“By the end of this period, the farmer will be left in possession of a piece of land that is commercially viable and that is bankable,” Nyamurundira said.
The farmers who sign onto the joint venture agreement are entitled to an annual stipend.
“From day one the farmers get US$150 per hectare per year and this appreciates in value every year as the trees grow. By the fifth year, that land will be worth US$500 per hectare.
“By the 10th year when the loan has been cleared, the farmer has an opportunity to buy into the business. They can approach banks and use the citrus under export to apply for funding for equity,” Nyamurundira said.
“The investors have also proposed to the government that they want to give five percent of the revenue from the citrus to the government’s compensation commitments.
“They don’t want the land under the orchards to be given the ‘contested land’ tag and hopefully, this also opens up markets in Europe.”
This comes amid excitement in the Zimbabwean horticulture sector at the prospect of gaining access to the Chinese market after the signing of a citrus trade protocol between the two countries.
The 2021 protocol was signed as part of efforts by Zimbabwe to add China as a major agriculture export market.
It will broaden export destinations for Zimbabwean citrus and end the country’s over-reliance on South Africa and Europe.
The protocol will see Zimbabwean farmers export fresh citrus varieties, including sweet orange, mandarin orange, grapefruit, and sour orange to China.
Trade development and promotion body, ZimTrade, has also said the citrus trade protocol can open up the Asian giant’s market for other horticulture products from Zimbabwe.
ZimTrade conducted a market scan in China on the sidelines of a recent Zimbabwe-China Business Forum and believes that local farmers can earn premium value on a wide range of crops with the import bill for China in (horticulture) at US$521 million in 2021.
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