24-08-2012, 11:21 AM
Agricultural Marketing
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Background of the company
Amibara Agricultural Development plc is established by a dedicated local entrepreneur called Mr. Abdulatif Omar in the former Amibara Angelele farm which is acquired from the local people on a contract basis in 1997. Middle Awash Agricultural Development Enterprise. Omo valley Agro Industry Plc, Arba Minch and Abaya farms are under the administration of AMIBARA Business Group. These five farms are located in the Afar regional state and Southern Nations, Nationalities and people’s regional states. The farm started with 850 hectares on the present Gelsita farm (which is currently 3,485 hectares) to reach the current total cultivable area of more than 14,867 hectares at five different farms. After years of expanding the farming business it has integrated horizontally beginning from 2006.
Employment
Agriculture consumes the larger share of the employment of the country. Thus as an agricultural company AMIBARA Business Group employs about 2,500 permanent workers and more than 15,000 temporary laborers. Above all, the company has created employment opportunity and a chance to share knowledge and skills to the rural people where the farms are.
Partners and Customers
Customers
AMIBARA Business Group’s main products are lint cotton and oil seed. These products are raw materials for textile and garment factories and oil mills. Thus, major customers of AMIBARA are textile and garment factories and edible oil factories. Some of them are Ayka Addis textile factory, ELSE Addis, Dire Dawa textile factory, Kombolcha textile factory, Awasa textile factory, Arba Minch textile factory, Kebire Enterprises, Adama development, Almeda textile, etc. The main user of the cotton oil seed being Addis Modjo Edible oil factory which processes it to edible oil and supply it to the general public, other local edible oil factories also purchase from AMIBARA.
On the other side the main customers of the Aviation Unit are Arsi and Bale Agricultural developments, and other commercial farms locally and farms in Sudan.
Partners
In the process of reaching the level at which AMIBARA currently is; there are different development partners among these the salient ones are government officials from ministerial level to kebele administration, customers from small scale to large scale, employees from daily laborers to top level management, Banks and insurance companies, and most importantly the society at farms and other projects.
Environmental Analysis
The free market economy in which the country is operating is a good opportunity to the company to buy inputs and sell its products as well.
Though the expansion of the textile industry in the country has created a higher demand for cotton, it also is the main reason for the ban on export sales of cotton products. An export sale has an advantage of earning dollars which can be used for the purchase of machineries and inputs from abroad.
Although there is chance for technological advancements in the agricultural sector, lack of skilled man power and supply of spare parts for technologically improved machineries make it difficult for the sector. The company’s current situation compared to other local farms is technological good having semi-mechanized farms with future prospects to be improved.
Investment Opportunities
• Agriculture and Agro-processing – New private investment is sought in the production and processing of agricultural crops such as coffee (the country’s single most important cash crop), tea, sugar, flowers, fruits and vegetables, teff, wheat, maize, beans, peas, lentils, soybeans, chickpeas, starch production, oil crops such as rapeseed, linseed, groundnuts, sunflower, sesame, maize, Niger seed and cotton seed, as well as investment opportunities for introducing modern commercial livestock breeding and processing into the largest livestock population in Africa (cattle, sheep and goats), plus significant fresh water fishery and livestock resources. Investment is also reqired in the provision of agricultural support services such as pest and disease control.
Factors Affecting Cotton Supply in Ethiopia
The largest volume of cotton production in the world is concentrated in countries like China, United States, India, Pakistan and Brazil. And yet, low income countries in Sub-Saharan Africa (e.g. Benin, Burkina Faso, Chad) and other similarly poor countries elsewhere in the world depend heavily on cotton for earning foreign exchange (Anderson and Valenzuela, 2006). Ethiopia is one of the African countries that produce and export cotton. It has an estimated area of 2,575,810 hectares that is suitable for the cultivation of cotton (ESTC, 2006). However, the total production area is only about 100,000 hectares. According to Sneyd (2006), also the area of land allocated for cotton in Ethiopia during 2004/05 was 113,000 hectares.