Liberian Rice Producer Struggling As Gov’t Plans To Open Door For Foreign Investor
Margibi County – Jeanine Cooper is an audaciously ambitious entrepreneur venturing into Liberia’s agribusiness sector despite the incessant challenges.
Report by Alpha Daffae Senkpeni – [email protected]
“The bank is supposed to bridge the gap. Everywhere in the world the banks, financial institutions play a role between farmers and processor, between processor and distributors – here (in Liberia) they don’t play that role” – Jeanine Cooper, Liberian Entrepreneur
About three years ago, she, along with partners, opted to put her money into the sector when most Liberians looked elsewhere.
As Senior Partner of Fabrar Liberia Inc., one of three major players in Liberia’s rice production industry, she’s given the sector a beacon of hope.
The firm is thriving on daring optimism to see locally produced rice available to most Liberians and compete with foreign importers.
She’s very aware of the demand for rice in Liberia, and from an investment standpoint, she knows it would yield more opportunities by putting more money into the sector.
“If we can consider institutional sales because our processing capacity is not up to speed, and the government can support local rice processors by buying the rice from us at a price that we will be able to sell and make profits.
“That profit will go down to the farmers and everybody in the value chain will benefit,” Cooper told FrontPage Africa during a tour of her rice processing facility in Kakata, Margibi County.
She’s determined to increase competition for foreign rice importers, which she reckons might significantly have a trigger down effect on the retail price and the availability of rice in the country.
Currently, Fabrar buys paddy rice from local farmers in Margibi, Grand Cape Mount, Lofa, Nimba, Bong, Grand Bassa and Grand Gedeh Counties and spends about US$9,000 as processing cost every month.
The firm produces between 70 and 90 tons of rice per month although it has the capacity to process about 150 tons monthly.
Constraints along the value addition chains are not stopping the firm’s investment plan.
Fabrar’s business module has received an appreciable level of applauds from international partners including USAID and the World Bank.
And Cooper is optimistic that once Liberian companies get the requisite support they can produce 40 percent of rice consumed in the country.
“In three years we will be able to feed Liberia if they adopt our business module and we commercialized the way rice is grown, produced, processed and distributed in Liberia,” she said.
“We also have the West African market which is the largest consuming market of rice on the continent so we can start exporting to other countries in the region if what we produced here cannot be consumed by us.”
Currently, Fabrar supplies the Liberia Maritime Authority and international NGO, Mary’s Meal, for its school feeding program.
The firm supplies about 30 percent of the NGO demand but has now increased its capacity to take on the full demand.
However, Cooper is looking to infuse about a million United States dollars into the sector by expanding her investment, augmenting production and increasing distribution.
But the challenges are enormous for investments like hers and acquiring loans from the bank is on top of the list of challenges.
So far, the only loan Cooper managed to source from the Liberia Bank for Development and Investment (LBDI) was in 2017 when she was constrained to provide several collateral.
It was a protracted and bureaucratic process even though her firm at the time had the backing of international development partners like USAID.
“The bank is supposed to bridge the gap. Everywhere in the world the banks, financial institutions play a role between farmers and processor, between processor and distributors – here (in Liberia) they don’t play that role,” she said.
Her firm also faces problems with farmers and aggregators that are either dishonest in supplying rice when they are paid or lack the knowledge to supply the exact quantity and quality.
But having a fair share of the market is problem local rice producers are encountering and this has the tendency of strangulating the sector.
Cooper says the Government buys rice for the Armed Forces of Liberia and other institutions at US$14 for a 25kg bag, which she deems a lost for Liberian producers, who carry the burden of production cost at US$13.89 for a 25kg bag of rice.
“The government pays US$6 more when buying from importers which is US$19.00; US$39 for 50 Kg. Why we could have gotten a dollar – since then I refused to sell to the government unless they will buy from me at the regular price,” she said.
Local rice producers also face stereotypical misconception from the Ministry of Agriculture, Cooper says.
The ministry perceives local producers like hers as threat to the local farmers and considers the processing companies as the ‘enemy’ of the farmers.
“And that was the mistake that was made by the Ministry of Agriculture by focusing only on the farmers and not the next step which is a processing.
To reduce risks and challenges for the local rice production sector, Cooper suggests more emphasizes have to be placed on the implementation of foreign aid rice production projects in the country.
“World Bank comes in February; Japan comes in September and African Development Bank comes in December.”
“All of them doing different things in different places; they are not joined together and at the end of the day, because the processors are so few and when the rice are now produced for the market it spoiled.”
Connect those dots first with the development partners, as a coordinated effort and then a more tangible progress would be made in the local sector, which would see farmers reaping the benefits of their hard labor, she said.
According to Cooper, a recent meeting held between Liberian rice producers and President George Weah ended disappointingly for them after the President disclosed that the government is contemplating striking a deal with a foreign firm to invest in local rice production.
“We are the Liberian rice business group; we are the ones that went to meet the President and he informed us that he had already met with the Nigerian investors and that’s the way he is going,” she said.
Liberian producers like Fabrar see the President’s move as a slap in their face despite their struggles to keep a lifeline.
She said the most feasible approach for enhancing locally produced rice is pouring capital into existing investments in the country.
However, she suggests that the government should also encourage collaboration between the local and any possible foreign investors.
“We have the capacity to say this is how you can support us and we gave him several points on how they can support us,” she said of the meeting with the Liberian leader.
Meanwhile, Cooper says local producers are calling on the government to reserve the supply to public institutions, schools feeding programs, and agencies for local producers.
“Once we have contracts like that this sector will grow and when Fabrar grows all the farmers that are supplying me will grow as well.”
“Ministerial purchases of rice should be 100 percent local rice and they should buy it from us at a competitive price which is what they pay importers.
“The other thing is that government must centralize the payment, because you sell rice to government and you wait half a year before getting your money.”
“For our own Liberian business, we cannot withstand two years of the government owing money and not paying us.”