Sustainable Grains & Pulses Innovation
Sustainable Grains & Pulses Innovation
Business Model Description
Invest in sustainable grain and pulse production, including climate-smart agriculture and improved logistics to reduce post-harvest losses and boost productivity. This can be coupled with upgraded storage, transportation, and processing facilities.
Expected Impact
Enhance agricultural productivity, sustainability, and income equity among smallholder farmers, particularly women and marginalized communities.
How is this information gathered?
Investment opportunities with potential to contribute to sustainable development are based on country-level SDG Investor Maps.
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Country & Regions
- Angola: Huambo
- Angola: Kuanza Sul
- Angola: Bié
- Angola: Benguela
Sector Classification
Food and Beverage
Development need
Investing in sustainable agriculture is pivotal for tackling poverty and climate change. It's significantly effective in raising incomes among the poorest, with the World Bank highlighting its power to boost shared prosperity and meet future food security needs (1).
Policy priority
The government is prioritizing family farming, providing access to essential inputs for fundamental products, while also promoting commercial farming to foster innovation and productivity (2).
Gender inequalities and marginalization issues
Women have lower quality jobs than similarly-skilled men; 86% of employed women engaged in vulnerable jobs (defined as own-account workers and contributing family workers) compared to 67% of men (25).
Investment opportunity introduction
Domestic consumption is growing and neighbouring countries can be a target market for export. Moreover, the country is rich in water sources. In 2022, the country exported beer, juices, and soft drinks for over USD 10 million (3).
Key bottlenecks introduction
Key bottlenecks in the agricultural sector may include vulnerability to climate change and climate shocks, low productivity and market access (4).
Food and Agriculture
Development need
The vast majority of grains (>95%) are grown by smallholder farmers and they are important crops because of its contribution to achieve food security in particular countries (5).
Policy priority
The Angola government is encouraging the development of wheat milling to replace relatively costly flour imports as part of its overall economic diversification plan and value added local production (6).
Investment opportunity introduction
Sustainable investment in the grains and cereals market, focusing on crops like maize, rice, and sorghum, offers a promising opportunity. The nation’s favourable climate and vast arable land present a significant potential for increasing grain production sustainably (7).
Key bottlenecks introduction
Unpredictable market demand and unreliable purchasers hinder farmer profitability and stability. Dependency on assembly traders underscores the need for stronger market instruments and support mechanisms (8).
Agricultural Products
Pipeline Opportunity
Sustainable Grains & Pulses Innovation
Invest in sustainable grain and pulse production, including climate-smart agriculture and improved logistics to reduce post-harvest losses and boost productivity. This can be coupled with upgraded storage, transportation, and processing facilities.
Business Case
Market Size and Environment
> USD 1 billion
< 5%
The global demand for grains and cereals is steadily increasing, driven by population growth and changing dietary preferences. The global cereals market, with a value of USD 37.4 billion in 2023, is anticipated to grow at 4.3% from 2023 to 2028 (10).
Through the PLANAGRAO, Angola is looking for investments of USD 550 million to produce 1.3 million metric tons of grains in the next five years. The Private Investment Law considers a contractual regime for large-scale investments, allowing negotiations for tax deductions and credits, and a special regime that grants automatic benefits for investments in priority sectors like agriculture (31).
Indicative Return
20% - 25%
According to FAO, with the Hand in Hand initiative, investments of USD 550 million to produce 1.3 million MT of grains in 5 years would have an IRR of 21% (11).
Investment Timeframe
Long Term (10+ years)
Investments in cereal crops in Angola typically span several years, requiring a mid- to long-term commitment due to agricultural processes, market dynamics, and infrastructure development (12).
Ticket Size
USD 1 million - USD 10 million
Market Risks & Scale Obstacles
Business - Supply Chain Constraints
Market - Volatile
Impact Case
Sustainable Development Need
Food security remains a challenge in Angola, particularly in the Southern provinces hit by climate change-induced droughts. Facing this challenge, the 2023-2027 National Development Plan (NDP) sets food security as one of the two major pillar of development planning. Food security is closely related with other two development challenges: income generation in rural areas, particularly smallholder farmers, and nutrition, particularly for children.
Food security is one of the two major priorities of the 2023-2027 National Development Plan (NDP). The NDP encourages the expansion of both family farming and commercial farming counting on favourable climate conditions and vast arable land, 35 million hectares, of which only 10% is cultivated (32).
Gender & Marginalisation
Women have lower quality jobs than similarly-skilled men; 86% of employed women engaged in vulnerable jobs (defined as own-account workers and contributing family workers) compared to 67% of men (25).
Expected Development Outcome
Enhanced food security through increased local grain production, leading to reduced dependence on imports and improved access to staple foods for the population.
Grain production infrastructure and value chains with investment that boosts opportunities for rural communities.
Sustainable practices that promote soil health, water conservation, and biodiversity, adopted.
Gender & Marginalisation
By providing employment opportunities in grain cultivation, processing, and marketing, the business model empowers women economically, enhancing their decision-making power and autonomy within households and communities (16).
Participation in the grains and cereals business provides women and rural communities with opportunities for income generation, reducing poverty and improving their economic well-being (16).
By increasing local grain production, it contributes to food security, reducing reliance on imports and ensuring access to staple foods for the population (16).
Sustainable Agriculture: Adoption of sustainable farming practices promotes soil health, water conservation, and biodiversity, contributing to environmental sustainability and resilience to climate change (16).
Primary SDGs addressed
1.1.1 Proportion of the population living below the international poverty line by sex, age, employment status and geographic location (urban/rural)
According to the Angola Poverty Assessment by the World Bank, the incidence of poverty in Angola as of 2019 was 32.3% at the national level (17).
25% by 2025 (17).
2.4.1 Proportion of agricultural area under productive and sustainable agriculture
For 2020, 10% of the country’s arable land was under cultivation (30).
N/A
13.2.2 Total greenhouse gas emissions per year
For 2015, the total greenhouse gas emissions in Angola was 99,992 ktCO2e (26).
Reduce to 36%, 21% unconditionally and 15% conditionally below Business As Usual emission levels by 2030 (26).
15.2.1 Progress towards sustainable forest management
In 2020, the proportion of forest area within legally established protected areas was 2.7% (27).
N/A
Secondary SDGs addressed
Directly impacted stakeholders
People
Gender inequality and/or marginalization
Planet
Corporates
Indirectly impacted stakeholders
People
Corporates
Public sector
Outcome Risks
Water Depletion: Intensive irrigation in grain production can deplete groundwater resources, disrupt aquatic ecosystems, and contribute to water scarcity for other uses (18).
Loss of Biodiversity: Monocropping practices in large-scale grain production can reduce biodiversity by eliminating natural habitats and disrupting ecological balance, leading to negative impacts on ecosystem services and resilience (18).
Social Displacement: Large-scale grain production projects may lead to land grabs, displacement of indigenous communities, and loss of traditional livelihoods, exacerbating social inequalities and conflicts (19).
Impact Risks
Lack of necessary skills among workers could hinder employment opportunities, impeding poverty reduction efforts.
Without proper skills, farmers may not effectively adopt sustainable practices, risking productivity and environmental harm.
Impact Classification
What
Increased sustainable production and export of grains and pulses, enhancing food security and economic growth.
Risk
Skill deficits can limit employment, hindering poverty reduction, and obstruct farmers' adoption of sustainable methods, risking productivity and environmental damage.
Contribution
Sustainable grain and pulse production and improving logistics and processing facilities significantly boosts agricultural efficiency and reduces post-harvest losses, contributing to greater food availability and economic resilience.
Impact Thesis
Enhance agricultural productivity, sustainability, and income equity among smallholder farmers, particularly women and marginalized communities.
Enabling Environment
Policy Environment
PLANAGRÃO is an Angolan government program to increase production of essential grains, specifically maize, wheat, soya, and rice. Funded by the state and the private sector, it is looking for investments of USD 550 million to produce 1.3 million MT of grains (11).
Financial Environment
Fiscal Incentives: Private Investment Law (Law 10/21 of 22 April 2021) offers incentives such as tax breaks, subsidies for sustainable farming practices, and support for infrastructure development. It promotes foreign direct investment in agriculture, offering a conducive legal framework and potential partnerships with local stakeholders (24).
Regulatory Environment
Decree No. 92/04 rules on the import of transgenic or genetically modified grain used as food support in compliance with the recommendations made by the Integrated Council of Ministers of Southern Africa Development Community (SADC) (27).
Marketplace Participants
Private Sector
Carrinho, Vera Nova, Angopri, Novagrolider, Breda, Socamia, Casa do Fazendeiro.
Government
Ministério da Agricultura e Florestas (MINAGRIF), Instituto de Desenvolvimento Agrário (IDA).
Multilaterals
United Nations Development Programme (UNDP), World Bank, International Finance Corporation (IFC).
Target Locations
Angola: Huambo
Angola: Kuanza Sul
Angola: Bié
Angola: Benguela
References
- (1) Farmers Review Africa (2022). Angola has potential as a future agriculture powerhouse. Source: https://furtherafrica.com/2022/09/15/angola-has-potential-as-a-future-agriculture-powerhouse-world-bank/.
- (2) Government of Angola (2023). Programa de Apoio à Produção, Diversificação das Exportações e Substituição das Importações. Source: https://governo.gov.ao/programa/prodesi.
- (3) General Tax Administration (AGT) (2022). External trade statistics.
- (4) World Economic Forum (2022). Angola's agricultural sector could become Africa's powerhouse. Here's why. Source: https://www.weforum.org/agenda/2022/09/angola-agricultural-sector-powerhouse-of-africa/.
- (5) Rabo Partnerships B.V. (2023). Boosting the Food & Agribusiness Sector in Angola. Source: https://www.rvo.nl/files/file/2023-08/boosting-the-food-and-agribusiness-sector-in-angola.pdf.
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- (7) World Bank Group (2019). Creating markets in Angola. Source: https://documents1.worldbank.org/curated/en/606291556800753914/pdf/Angola-Country-Private-Sector-Diagnostic-Creating-Markets-in-Angola-Opportunities-for-Development-Through-the-Private-Sector.pdf.
- (8) Ones Karuho & Kate Collins (2020). Improving African Grain Markets for Smallholder Farmers. Source: https://agra.org/archive/wp-content/uploads/2020/07/Grain-Markets-Report-7-26-20.pdf.
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- (11) FAO (2023). Angola Investment Plans and Opportunities. Source: https://www.fao.org/hand-in-hand/hih-IF-2023/angola/en.
- (12) FAO (2016). In Angola, FAO launches a project to promote innovation for sustainable agricultural growth. Source: https://www.fao.org/in-action/tropical-agriculture-platform/news/detail/en/c/415738/.
- (13) McKinsey & Company (2019). Winning in Africa’s agricultural market. Source: https://www.mckinsey.com/industries/agriculture/our-insights/winning-in-africas-agricultural-market.
- (14) United States Department of Agriculture Foreign Agricultural Service (2024). Grain: World Markets and Trade. Source: https://apps.fas.usda.gov/psdonline/circulars/grain.pdf.
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- (21) African Development Bank Group (2023). Angola - Agriculture Sector Reform Program (ASRP) - Project Appraisal Report. Source: https://www.afdb.org/en/documents/angola-agriculture-sector-reform-program-asrp-project-appraisal-report.
- (22) Governo (2023). Programa de Apoio à Produção, Diversificação das Exportações e Substituição das Importações. Source: https://governo.gov.ao/programa/prodesi.
- (23) World Economic Forum (2022). Angola's agricultural sector could become Africa's powerhouse. Here's why. Source: https://www.weforum.org/agenda/2022/09/angola-agricultural-sector-powerhouse-of-africa/.
- (24) Law 10/21 of 22 April 2021. See also: UNCDTAD (2021) - Amendments to the Private Investment Law. Source: https://investmentpolicy.unctad.org/investment-policy-monitor/measures/3705/amendments-to-the-private-investment-law-.
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- (28) Milling MEA. 2023. Angola achieves record cereal production, surpassing three million tons. Source: https://www.millingmea.com/angola-achieves-record-cereal-production-surpassing-three-million-tons/.
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