Investment | DuPont Plans to Double Its African Seed Business in Five Years

LAGOS, Nigeria, Capital Markets in Africa: DuPont Company plans to more than double its African seed business, excluding the mature South African market, over five years as governments and farmers on the least-developed continent seek to boost crop yields, a director of the company’s Pioneer unit said.

“From a revenue perspective we’re aiming for over 20 percent in terms of the compound annual growth rate,” Prabdeep Bajwa, the African regional business director for Pioneer, said in an interview Thursday at the World Economic Forum on Africa in the Rwandan capital, Kigali. “Africa is deemed a strategic long-term play for us.”

DuPont is the largest private corn-seed provider in Africa after Pioneer bought a controlling stake in South Africa’s closely held Pannar Seed Ltd. in 2013. A combination of low hybridization, old seed technology and poor management practices mean there are lots of opportunities to grow sales, he said.

While South Africa is the most developed and largest market on the continent, countries including Kenya, Zimbabwe, Zambia, Tanzania and Ethiopia offer prospects for significant growth, Bajwa said.

“From a growth perspective, it’s these countries which are really underdeveloped,” he said. “Average yields are 2 metric tons per hectare across these countries.”

Cereal yields in North America and the European Union, by contrast, are 6.9 tons and 5.4 tons respectively, according to World Bank data.

“You cant do this alone in Africa, you have to collaborate with governments, there’s just so many farmers,” he said. “It takes time.”

DuPont in December agreed to merge with Dow Chemical Co. and form the world’s largest agriculture business.

Source: Bloomberg Business News