Singapore trader secures US$25m to scale up Agri-processing in Africa

Robust International, a Singapore-based agricultural commodity trading firm has secured a US$25m investment from BluePeak Private Capital to expand its processing capacity for sesame seeds and cashew nuts in Nigeria, Côte d'Ivoire, Burkina Faso, and Mozambique. BluePeak, an alternative asset management firm with offices in Tunis, Nairobi, and London, aims to support Robust in adding value to Africa’s agricultural exports.

Operating in 10 African countries, Robust sources a diverse range of agricultural commodities, which it then distributes globally. Despite Africa being a major producer of raw cashew nuts and sesame seeds, most of its produce has historically been exported in unprocessed form to Asia for value addition. Robust seeks to change this dynamic by increasing its processing capacity on the continent, transitioning from a semi-processor to a producer of edible commodities.

This investment follows a US$18m loan agreement signed with the International Finance Corporation in 2022. The loan was intended to establish modern warehouses and processing centres for sesame in northern Nigeria. Sesame accounts for 55% of Robust’s operations in Nigeria, while other crops include cashew, ginger, gum arabic, pulses, turmeric, and shea nuts. The company sources 40% of its raw commodities directly from over 40,000 farmers, and 60% from 40 licensed buying agents. Robust conducts primary processing, such as fumigation, sorting, and hulling, before distributing to its clients. The majority, or 53%, of its commodities are supplied to China, with other important markets being Vietnam (37%), Turkey (6%), and India (4%).

Nigeria is the world's sixth-largest producer of sesame and the third largest in Africa, behind Sudan and Tanzania. Most sesame cultivation occurs in the drier northern region. Sesame crops account for approximately 25% of Nigeria's agricultural export value. In 2023, Nigeria exported sesame seeds worth US$428m, with 30% going to China, 20% to Japan, and 13% to India.

Yet, the industry faces several challenges. Most of Nigeria's sesame cultivation is done by small-scale farmers who struggle with low productivity due to limited use of mechanised farming techniques and insufficient access to improved seed varieties and other essential agricultural inputs. Additionally, the country lacks adequate sesame processing facilities, with most seeds still being processed manually, leading to reduced quality and high wastage.

At the 2023 Africa Singapore Business Forum, Robust entered into agreements with two other Singapore entities – Adatos, which employs AI to improve agricultural yields, and Trames, a digital freight management platform – to enhance its operations in Africa. The firm inked a partnership with Adatos to leverage its AI expertise for insights into weather patterns, yield predictions, and nutrient usage for sesame crops in Nigeria. Meanwhile, Trames, a digital freight management platform, will deliver bespoke logistics solutions to optimise Robust’s supply chain in Africa and beyond.

 

References

‘Sesame seed can generate over $1bn annually for Nigeria – NSSAN', Vanguard Media, 12 October 2019

‘IFC backs Singapore-based agricultural company Robust’s plans to expand in Nigeria’, International Finance Corporation, 07 April 2022

‘Which country produces the most sesame seeds?', Helgi Library, 12 January 2023

‘Five new business deals signed as more Singapore firms respond to call of Africa', The Straits Times, 29 August 2023

‘Singapore commodity trader partners AI and digital logistics firms to boost sesame output in Nigeria’, NTU-SBF Centre for African Studies, 26 September 2023

‘Foreign trade in goods statistics (Q4 2023)’, National Bureau of Statistics, Accessed 27 May 2024

‘Robust International Group Nigeria’, International Finance Corporation, Accessed 27 May 2024

‘BluePeak’s USD 25m investment in Robust International supports its forward integration, enhancing processing capacity and driving contribution to food security’, BluePeak Private Capital, 16 September 2024

‘List of importing markets for a product exported by Nigeria: 120740 Sesamum seeds, whether or not broken’, International Trade Centre, Accessed 20 September 2024