Soybean

Organic Soybean Cultivation and Processing

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Organic Soybean Cultivation and Processing

Country
Sector
Most major industry classification systems use sources of revenue as their basis for classifying companies into specific sectors, subsectors and industries. In order to group like companies based on their sustainability-related risks and opportunities, SASB created the Sustainable Industry Classification System® (SICS®) and the classification of sectors, subsectors and industries in the SDG Investor Platform is based on SICS.
Food and Beverage
Sub Sector
Most major industry classification systems use sources of revenue as their basis for classifying companies into specific sectors, subsectors and industries. In order to group like companies based on their sustainability-related risks and opportunities, SASB created the Sustainable Industry Classification System® (SICS®) and the classification of sectors, subsectors and industries in the SDG Investor Platform is based on SICS.
Food and Agriculture
Indicative Return
Describes the rate of growth an investment is expected to generate within the IOA. The indicative return is identified for the IOA by establishing its Internal Rate of Return (IRR), Return of Investment (ROI) or Gross Profit Margin (GPM).
> 25% (in GPM)
Investment Timeframe
Describes the time period in which the IOA will pay-back the invested resources. The estimate is based on asset expected lifetime as the IOA will start generating accumulated positive cash-flows.
Short Term (0–5 years)
Market Size
Describes the value of potential addressable market of the IOA. The market size is identified for the IOA by establishing the value in USD, identifying the Compound Annual Growth Rate (CAGR) or providing a numeric unit critical to the IOA.
< USD 50 million
Average Ticket Size (USD)
Describes the USD amount for a typical investment required in the IOA.
< USD 500,000
Direct Impact
Describes the primary SDG(s) the IOA addresses.
Zero Hunger (SDG 2) Zero Hunger (SDG 2) No Poverty (SDG 1)
Indirect Impact
Describes the secondary SDG(s) the IOA addresses.
Decent Work and Economic Growth (SDG 8) Gender Equality (SDG 5)

Business Model Description

Cultivate and process organic soybeans using processes that preserve their organic character allows for more added value and for gaining market share locally and for export.

Expected Impact

Contribute to food security and poverty reduction as well as the establishment of sustainable agriculture.

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

Explore the country and target locations of the investment opportunity.
Country
Region
  • Togo: Maritime
  • Togo: Plateaux
  • Togo: Centrale
  • Togo: Kara
  • Togo: Savanes
Learn more

Sector Classification

Situate the investment opportunity within sustainability focused sector, subsector and industry classifications.
Sector

Food and Beverage

Development need
Poverty is slowly decreasing with a rate going from 55.1% to 45.5% between 2015-2019, far from a complete elimination of extreme poverty targeted for 2030. In rural area, the poverty rate is 76.1% (1). Chronic, acute malnutrition and underweight affect respectively 27.5%, 6.5% and 16% of children under five years old particularly in the regions of Savanes, Kara and Plateaux (21).

Policy priority
Making agriculture a real engine of growth and job creation is one of Togo's ten strong ambitions (2). The Agricultural Plan aims to “modern, sustainable and high value-added agriculture serving national and regional food and nutritional security; a strong, inclusive, competitive economy that generates decent jobs and stable by 2030 and reduction of poverty and rural vulnerability (21).

Gender inequalities and marginalization issues
Women are poorly empowered and confined to agricultural activities. Mostly women (53.46% compared to 46.54% of men) carry out agricultural activities, notably in the activities of weeding, sowing, harvesting, storage, processing and marketing of products. The agricultural sector, with its low productivity and low income, plunges agricultural workers, particularly women, in high levels of poverty (1).

Investment opportunities introduction
Investment opportunities are due to both the expansion of local and foreign markets for many agricultural value chains and the land reform Togo initiated, which establishes equal rights of access to land for both women and men. Food crops have significant growth and employment potential, while livestock products and cash crops have additional growth effects (3).

Key bottlenecks introduction
Several constraints affect agricultural value chains like, limited production capacities to satisfy expanding and competitive markets, financing constraints for farmers, lack of long-term credit, and transport costs and constraints. Land issues also exacerbate the situation of farmers, particularly women and young people (3).

Sub Sector

Food and Agriculture

Development need
The situation of malnutrition and undernourishment in Togo places the food and beverage production sector at the center of these scourges. The agricultural sector does not provide sufficient production and suffers from low productivity and low income for workers. Various agricultural subsectors are involved, including crop, livestock, fish production and agri-food industries (21).

Policy priority
As part of the operationalization of the agricultural national policy, investment plans by crop have been developed for the period 2024-2028: roots and tubers; pineapple; fonio; cashew; shea; and mango (21), and a five-year plan for the soybean sector.

Gender inequalities and marginalization issues
Women are engaged in individual activities to the point where the majority of them are in the informal sector (54%), commerce and services (53.46%) as well as agricultural activities. Women experience land insecurity and low jobs opportunities which also affect young people. They also suffer from limited support in securing their production plots, as well as difficulties in accessing credit (4).

Investment opportunities introduction
With a view to encouraging exports, Togo has engaged in liberalization characterized by measures to harmonize legislative and regulatory frameworks with treaties and agreements. Making way for the private sector, Togo inaugurated the Adétikopé Industrial Platform dedicated to the transformation of Togo's natural resources and agricultural exports (5).

Key bottlenecks introduction
Competition between smallholder farmers and agro-industries for access to land results in the detriment of smallholder farmers finally deprived of land. Weak water resource management, downstream pollution as well conflicts linked to transhumance and storage infrastructure deficit affect agricultural activities (21).

Industry

Agricultural Products

Pipeline Opportunity

Discover the investment opportunity and its corresponding business model.
Investment Opportunity Area

Organic Soybean Cultivation and Processing

Business Model

Cultivate and process organic soybeans using processes that preserve their organic character allows for more added value and for gaining market share locally and for export.

Business Case

Learn about the investment opportunity’s business metrics and market risks.

Market Size and Environment

Market Size (USD)
Describes the value in USD of a potential addressable market of the IOA.

< USD 50 million

CAGR
Describes the historical or expected annual growth of revenues in the IOA market.

< 5%

Critical IOA Unit
Describes a complementary market sizing measure exemplifying the opportunities with the IOA.

Togo reached a trade balance of USD 5.14 million for vegetables and fruits in 2022.

Imports of food and animal products amounted to USD 322.458 million, or 11.1% of total imports in 2022 for a deficit of USD 10.77 million in the same year. Imports of fruit plants exceeded exports of products in the same category by USD 5.14 million in 2022. This balance can be considered as the initial market size of plant and fruit products (6).

Soybean production for the 2022-2023 campaign was 281,000 tonnes. The farm-gate purchase price was set at 300 CFA F/kg (USD 0.5/kg) or USD 500 per tonne for the 2022-2023 campaign. The produced value of soybeans in 2023 is therefore for 281,000 tonnes of equalling USD 140.50 million (25). Soy production is carried out by several producers, among them more than 200 companies for a turnover in 2020 (26, 27).

For the 2023-2024 campaign, the objective is 300,000 tonnes, divided equally between conventional soybeans and organic soybeans. 80% of conventional soybeans will be processed and 20% exported. 60% of organic soya will be exported and 40% processed locally (24). A farm gate price of 200 F/kg or USD 33,333 per tonne is set for the 2022-2023 campaign (25).

Indicative Return

GPM
Describes an expected percentage of revenue (that is actual profit before adjusting for operating cost) from the IOA investment.

> 25%

As part of the case study conducted for an organic soybean farming project, profitability is estimated at 11% in the first year and 38% in the last year (28).

The production of organic soya appears to be more profitable in Togo than that of other vegetables and cereals. Yields per hectare are around three tonnes of soybeans and allow appreciable profitability (26, 27).

Investment Timeframe

Timeframe
Describes the time period in which the IOA will pay-back the invested resources. The estimate is based on asset expected lifetime as the IOA will start generating accumulated positive cash-flows.

Short Term (0–5 years)

The study of the financing modalities of an agricultural farm producing organic soya in Togo estimates the duration of amortization of the loan and return on investment at 5 years (28).

The return on investment period for many soy production projects is approximately 5 years as presented on the website of the Agency for the Promotion of Investments and the Free Zone of Togo (29).

Ticket Size

Average Ticket Size (USD)
Describes the USD amount for a typical investment required in the IOA.

< USD 500,000

Market Risks & Scale Obstacles

Capital - Requires Subsidy

Agricultural investments are constrained by financing. Less than 1% of bank loans go to the agricultural sector. Financial institutions hope for a rapid return on investment and guarantees. The cost of the microfinance funds to which agricultural promoters are led to are also very high (30).

Business - Supply Chain Constraints

Growing food clashes with access to land, particularly for women, as land is held by communities and family groups who manage it to the detriment of women and girls. This results in disputes and land conflicts, the management of which constitutes an important axis of Togo's agricultural policy (31).

Market - High Level of Competition

The processing of agricultural products is faced by high cost of energy. This is the case for cotton and soya for which the competitiveness of the products derived from them, especially textiles and oils, is affected (7).

Impact Case

Read about impact metrics and social and environmental risks of the investment opportunity.

Sustainable Development Need

According to PNIASAN, the trade balance of agricultural and food products presents an average annual deficit of USD 99.083 millions over the period 2010-2014 (32). Food import included cereals, particularly rice, and meat products and fish, which reached USD 454.167 million in 2022 (6).

In 2022, the cereal deficit increased to 25,179.60 tonnes of exports of cereals and cereal preparation. For pulses and fruits, imports were 57,469.70 tonnes against exports of 19,115.20 tonnes. The deficit for pulses and fruits reached USD 5.14 millions (6).

Togolese agriculture is characterized by low productivity, which condemns workers in the agricultural sector to low incomes. This means that populations living from agriculture are among the poorest due to the low-paying nature of agriculture; the national poverty rate was 45.5% in 2019, compared to 76.1% in rural areas the same year (1 ).

Gender & Marginalisation

Women working in Togolese agriculture, including in organic soy production, are subjected to poorly paid tasks which plunge them into poverty (1). Women's ability to seize economic opportunities in rural areas is limited by unequal access to land ownership (8).

Around 25.21% of women and even fewer in rural than urban areas compared to 38.3% of men have access to a bank account (8). This situation limits the ability of women to invest and implement more productive processes due to lack of adequate equipment and inputs like improved seeds (8).

The limitation of women's opportunities in rural areas, materialized by their poor access to land and financing, forces them to set up systems of production and processing of agricultural products that are not very productive and poorly remunerated (8).

Expected Development Outcome

Organic soybean cultivation for food based on high productivity cultivation methods will provide abundant and nutritionally diverse food products for the growing needs of the population and ensure food security.

Organic soybean cultivation for food will provide better remuneration for engaged workers and contribute to increased income from the export of organic soybeans and reduced imports of vegetables and cereals.

Organic soybean cultivation for food will create increased valorisation opportunities including through the supply of raw materials for the production of edible oils and animal feed.

Gender & Marginalisation

Organic soybean cultivation for food improves the remuneration of agricultural workers, particularly women who are the most numerous to work in this space, and allows them to escape poverty.

Organic soybean cultivation for food improves the technical and financial capacities of women in agricultural activities and allow them to improve their financial assets and capabilities to undertake and fully seize their opportunities.

Organic soybean cultivation for food ensures to women, including youth, the implementation of improved techniques for processing agricultural products for increased added value.

Primary SDGs addressed

Zero Hunger (SDG 2)
2 - Zero Hunger

2.3.1 Volume of production per labour unit by classes of farming/pastoral/forestry enterprise size

Current Value

14.00 PPP USD of agricultural production per day of work of small food producers in 2019 (9).

Target Value

28.00 PPP USD of agricultural production per day of work of small food producers by 2030 (9, 21).

Zero Hunger (SDG 2)
2 - Zero Hunger

2.1.1 Prevalence of undernourishment

Current Value

12.8% in 2022 (9).

Target Value

N/A

No Poverty (SDG 1)
1 - No Poverty

1.1.1 Proportion of the population living below the international poverty line by sex, age, employment status and geographic location (urban/rural)

Current Value

26,6% in 2021 (9).

Target Value

N/A

Secondary SDGs addressed

Decent Work and Economic Growth (SDG 8)
8 - Decent Work and Economic Growth
Gender Equality (SDG 5)
5 - Gender Equality

Directly impacted stakeholders

People

Workers in the cultivation and processing of organic soybeans based on high productivity will see their well-being improved and their ability to work strengthened. Such success would be likely to attract other promising people to this IOA and contribute to the fight against poverty.

Gender inequality and/or marginalization

Women and girls employed in the cultivation and processing of organic soybeans, with improved equipment and seeds, will be able to increase their production and achieve significant remuneration that can improve their living conditions.

Planet

Parties implementing diversified agriculture and resilient, high-productivity agricultural practices in the cultivation and processing of organic soybeans will contribute to the preservation of ecosystems and the strengthening of the capacity to adapt to climate change.

Corporates

Service providers and agricultural works, companies operating as suppliers or customers of the cultivation and processing of organic soybeans aimed at improving productivity will enable organic soybean to cope with the growing markets.

Public sector

Public authorities, through the implementation of Planned Agricultural Development Zones and other incentives, will contribute through their external economies to strengthening the viability of agricultural projects including those of the cultivation and processing of organic soybeans

Indirectly impacted stakeholders

People

The cooperatives and family farming units involved in the cultivation and processing of organic soybeans will find in the highly productive investment opportunities as avenues for developing competitive agricultural entrepreneurship and any other economic opportunities.

Gender inequality and/or marginalization

Women, girls and young people will find opportunities to conduct their own activities differently, thus serving as models for increasing their own productivity.

Planet

Workers in the cultivation and processing of organic soybeans will learn the techniques of sustainable agriculture that have proven themselves in their immediate environment and implement them in turn and thus guarantee the sustainability of their agricultural activities.

Corporates

Several promoters will be encouraged to invest in the cultivation and processing of organic soybeans thanks to the performance that leading companies in the field will achieve, in particular by gaining greater market shares.

Public sector

Local governments will find opportunities to reduce unemployment through the development of small and medium-sized businesses in their districts in the area of organic soybean cultivation for food. They will thus be able to limit the rural exodus and attract other investors.

Outcome Risks

The cultivation and processing of organic soybeans not based on sustainable processes could affect ecosystems and constitute a considerable factor of harm to ecosystems and soil degradation, including water pollution, ecosystem degradation and increased greenhouse gas emissions.

The cultivation and processing of organic soybeans could face problems with access to land and cause competition between companies and farmers over these resources.

The high productivity of the cultivation and processing of organic soybeans could push uncompetitive developers and farmers out of business.

Impact Risks

High professional requirements in the cultivation and processing of organic soybeans could penalize young people and women living in production areas, who are less qualified.

Faced with a very competitive production process, women without land or capital and unable to find financing will be confined to unprofitable activities and trapped in poverty.

Low productivity could negatively affect the cultivation and processing of organic soybeans faced with competition from imported food products such as rice and vegetables by compromising sales.

Impact Classification

B—Benefit Stakeholders

What

Organic soybean cultivation and processing increase the income of agricultural workers, particularly women, while ensuring the reduction of imports of food products (7).

Who

Companies, the agricultural workers and professional associations involved in the cultivation and processing of organic soybeans and the Ministry of Agriculture participating in the intervention.

Risk

While the model is proven, professional requirements, competitive production processes and women involvement, and importation competition requires consideration.

Impact Thesis

Contribute to food security and poverty reduction as well as the establishment of sustainable agriculture.

Enabling Environment

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Policy Environment

Strategic Plan for the Transformation of Agriculture in Togo by 2030 states as objectives to ensure food security; rebalance the agricultural trade balance; improve the level of agricultural income; ensure a high rate of agricultural growth in a sustainable manner (21).

National Agricultural Investment, Food and Nutritional Security Program (PNIASAN) 2017-2026 is the tool for implementing the 2016-2030 agricultural policy accompanied by the Strategic Plan for the Transformation of Agriculture in Togo by 2030 through the development of agricultural centers (7).

Action Plan for the Soy Sector (2023-2028) has been put in place with the objective of promoting processing units for the crushing of soy intended for human and animal food. It is a plan for promoting the international export of organic soy and the local processing of soy-derived products (32).

As part of the operationalization of the national policy, investment plans by sector have been developed for the period 2024-2028. Soyabean is one of the domain covered by the investment plan (32).

The Ministry of Agriculture placed issues of equity and gender equality at a heart of its monitoring unit; women's empowerment is particularly considered through significant participation of women in production, processing and marketing activities of agricultural products (4, 7).

Financial Environment

Law 2019-005/PR of January 2019 on the investment code provides for approved companies making a minimum of USD 83,333,333 in new investment, exemptions from duties and indirect taxes or, in the case of imports, other taxes collected (granted for a period of five years) (12).

Companies generating 75% of their turnover from exports benefit from the special industrial zone regime (12) and are eligible for more tax advantages, including exemption from corporate tax during the first 5 years and 10% on taxable profit from the 11th to the 20th year (13).

Regulatory Environment

Law No. 2018‐005 of June 14, 2018 relating to the Land and State Code Art. 10 states that land is the subject of a policy known as national land policy: Subtitle 4 – National land policy (10). The policy influences agricultural activities for land acquisition and exploitation.

Policy Land Principles (Law No. 2018‐005) is applicable to property, access to land ownership, and use of land resources; seeks to improve productivity and the contribution of land resources to social, economic, political and environmental development; and works towards promoting poverty reduction (10).

Togo Land and State Code Law No. 2018‐005 of June 2018 prescribes that the state must ensure that women and girls enjoy equal land rights and equal access to land, fisheries and forests, regardless of their gender, civil status or their marital status (10).

The National Engagement Strategy states the need to ensure equitable access to land, constitutes the foundations of strategy aimed mainly at the development and implementation of a land policy, and defines sectoral policies with the involvement of multi-stakeholder and civil societies (11).

Marketplace Participants

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Private Sector

Agrokom SAS, Al-Walid Agribusiness SARL, Soja Bio SARL and Scoops Akpene Soja.

Government

Ministries for Agriculture, Livestock and Rural Development; Urban Planning, Housing and Land Reform; Village Water and Hydraulics; Environment and Forest Resources; Promotion of Investment.

Multilaterals

African Development Bank (AfDB); International Fund for Agricultural Development (IFAD); Food and Agriculture Organisation (FAO); World Bank; West African Development Bank.

Non-Profit

The Interprofessional Council of the Soy Sector (CIFS) brings together the following NGOs: National Federation of Soya Producers Cooperatives (FNCPS), National Association of Soya Traders and Exporters (ANCES) and Togolese Association of Soya Processors (ATTS).

Target Locations

See what country regions are most suitable for the investment opportunity. All references to Kosovo shall be understood to be in the context of the Security Council Resolution 1244 (1999)
country static map

Togo: Maritime

semi-urban

Togo: Plateaux

The Plateaux region is dominated by agriculture. Continental fishing is also practiced here thanks to dense hydrography (17, 18). The Plateaux region provides a significant contribution soybean production (like the Centrale region) (33).
semi-urban

Togo: Centrale

The Central region is marked by crafts, notably artisanal processing of agri-food products, the manufacture of local cheese, mango juice, mechanics, weaving, sculpture, basketry, pottery, cast iron, etc. (16). The Central region provides a significant contribution to soybean production (33).
semi-urban

Togo: Kara

The Savanes region, located in the north of the country, practices subsistence agriculture and cash crops. The Savanes region specializes in livestock farming and constitutes the main entry point for transhumant livestock (19). The Savanes region is the one with the most soy producers (33).

Togo: Savanes

References

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