K80m stake makes IAI a big player

INNOVATIVE Agro Industry (IAI) Ltd is committed to a continued presence in Papua New Guinea with equity investments of K80 million in various projects throughout the country to date.
Chairman Ilan Weiss says as an investor in the agriculture sector, IAI prides itself on a culture of delivery, bringing with it the industry technology of its homeland in Israel.
Weiss says IAI has introduced advanced methods and state-of-the-art technologies to its various operations.
These reflect project sustainability and profitability through market-driven production planning, high yields and efficient operation.
“Working with partners in both the public and private sector, we aim to develop commercial agriculture projects in PNG that will assist to meet important development goals for the majority of the population, who live in rural areas,” Weiss told The National.
“By efficiently harnessing PNG’s fertile land, water and most importantly human resources, we are working side by side to help realise the commercial agriculture potential of this sleeping giant.
“Till today, we have made equity investments of approximately K80 million in various projects, focusing on agriculture projects addressing logistics issues, logistics being one of the main issues facing rural PNG farmers.
“There are three other projects currently in development.
“We are continuously developing our seven farming sites throughout PNG in Koroba, Pangia, Hela, Enga, Tabubil, Ilimo and 9-Mile in Port Moresby.
“We are currently working hard to deliver our project pipeline so the focus over the next 12 months will we be on that.”

• In Aug 2018, IAI signed a memorandum-of-understanding with partners ExxonMobil, Mineral Resources Development Company and the district administrations and provincial administration of Hela to formalise plans for a large-scale coffee development project and jointly funded the detailed design phase at a cost of K10 million.
  “Preliminary results are very positive,” Weiss says.
  He says IAI is pleased with the pace of work on this project, which is a large-scale public-private partnership that will impact up to 5000 people in Hela.
  It addresses coffee development and marketing issues which are key to rejuvenating the industry in PNG.AI is looking at planting up to 15 million new coffee trees in Hela.
  “Our teams have been working with partners and the Coffee Industry Corporation to develop a model that will empower the people of Hela,” Weiss said.
  “The project will diversify the economic base in Hela and further encourage the development of additional small enterprise.”
  He says running parallel to the coffee project will be another agriculture initiative.
  “Coffee takes a long time to grow, so we have developed a maize programme to provide feed to our chicken factory in Hela,” Weiss said.
  “We are currently distributing seeds to local communities and assisting with extension work.
  “We have operated in Hela for some time.
  “The extraordinary resilience of the people of Hela in supporting themselves in their transition from subsistence farming to participation in the formal economy, through cash cropping and employment opportunities, tells us that this is a people who can absolutely guide their own positive change.
  “We are not just stepping into Hela province and adding an outsider’s perspective to strengthening the people’s spirit, post-natural disaster and tribal conflict, but rather, we are supporting the character of these people and their ability to focus on helping themselves.
  “It’s an approach to outgrower engagement that we take throughout the country.
  “We are committed to empowering communities to organise and develop solutions for participation that work for them.”
• In Oct 2018, IAI signed a shareholder agreement to embark on a K30 million commercial farming project in the Yangoru-Saussia district of East Sepik, partnering with the province, district, Kumul Agriculture and traditional landowners.
  Weiss said the project in Sepik would create 140 direct employment opportunities and thousands of outgrower opportunities.
  He said the project would begin with development of an agro-industrial centre focused on cocoa, grain production, stock feed processing and poultry production.
  “The facility will also feature a cocoa-drying and processing facility,” Weiss said.
  “The poultry production farm will cater for the local market and supply meat and eggs as a source of fresh protein to both East and West Sepik.”
• IAI is also currently moving ahead with plans for a second commercial dairy to be built at Yalu in the Huon-Gulf district of Morobe.
  “Plans are well advanced and we will have an update for you on that in the not-too-distant future,” Weiss said.
• IAI’s Ilimo Dairy has been performing exceptionally well with “fantastic support” from the local community.
  “We are now moving into a wider product line,” Weiss said.
  “Flavoured milk is already available, and, of course, our much-loved frozen milk sticks.
  “Ice cream, cream, yoghurt, butter and dairy snacks will be available this year.”
  Weiss saiad most importantly, IAI was committed to reducing its reliance on imported feed for its herd.
  “Although we are able to grow a significant amount of silage and maize onsite, it is not enough for the herds feed requirements,” he said.
  “We have been working closely with our partners in the dairy, Central government, to develop a maize outgrower programme for Central farmers.
  “With Central Province Women in Agriculture to create awareness for the project, IAI is assisting with extension support and development of a maize outgrower manual for farmers.
  “Ilimo Dairy Farm agronomist Ronen Peterofsky has been working with the Central team to provide extension support to communities.”
• In Dec 2018, IAI visited communities in the Kairuku-Hiri district with MP Peter Isoaimo.
  “Kairuku-Hiri was the first to participate in the pilot project, with the Brown River community leading the way,” Weiss said.
  “We are providing seeds to farmers as part of the programme, so our visit was to generate further awareness and directly engage with communities.
  “Two-way engagement is a big part of what we do.
  “Listening to the challenges local farmers are facing is important to developing outgrower models that empower communities and encourage participation from all members of the community.
  “We visited Daisama, Brown River, Taisiama village and Berere village in Doura, and Kerea village.”
  Weiss said IAI was also working with partners to develop a pilot programme to make the nutritional benefits of fresh milk available to a larger segment of the community that needs it the most.
  “We see a bright future for Papua New Guinea in the agriculture sector and we look forward to developing more and more agriculture projects around the country,” he said.

Challenges
“Our greatest challenges generally relate to infrastructure development in the country,” Weiss said.
“Transport costs are a big challenge – roads, bridges, and the cost of utilities and communications.
“I’m proud to say that problem-solving is a real strength of the IAI team here in PNG.
“This involves listening and constant face-to-face engagement with the communities in which we operate.
“Developing outgrower models that work for a community in one area doesn’t always work in another area of PNG.
“IAI operates projects from Enga to Central.
“We have learned to listen over time and we are often led by our local communities when it comes to developing models that work for them.”
Weiss said a good example of a model that is developed for a specific community is the Enga Agro Industrial Centre (AIC) model that creates employment opportunities for female workers from the local community.
“Encouraging rural women’s participation in commercial agriculture operations teaches them new skills,” he said.
Weiss said female participation in farming cooperatives can help to achieve economies of scale to access markets and reduce isolation, while building confidence, leadership and security. Weiss said women were an integral part of community building and involving them in projects that teach them new skills were essential to empowering women.
“Finding a way to do this without battling cultural norms and disrupting the communities’ way of life was the challenge faced by Enga AIC in creating employment opportunities for female farmers when the project first came online,” he said.
“The model currently used by the local community to ensure female participation, as employees of the farm, is a first for any agribusiness operation in the province.
“Households support each other to ensure that women are given the required time to hold a job in the farm.
“This is a solution developed by the communities themselves.
“IAI is very proud to have played a part in creating this opportunity for female empowerment and participation at the village level for local families.”