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Congo: The Next Brazil?

September 5, 2013
By: Ed Clark, Top Producer Business and Issues Editor
Congo
  
 
 

It has many problems, but great agricultural potential

In hockey, the best players never go where the puck is, but rather to where it’s going. That goes for farmers, too. The best anticipate the next opportunity years from now, as well as challenges. The latter includes a new potential global competitor not yet on the radar: the Democratic Republic of the Congo (DRC).

"We see the DRC becoming a major food supplier in the years ahead, its development potentially mirroring that of Brazil in the 1970s," according to a report from Renaissance Capital.

While the DRC is a net importer of corn, rice and poultry, in the 1960s and ‘70s, it was a net exporter. Corn production has doubled since 1980. This year, production is forecast to be 49 million bushels, about what’s grown in Maryland.

The nation is becoming more politically stable, economic growth is more than 8% and foreign capital is starting to flow into its ag sector.

"A lot of people are calling the Congo the next Brazil," says Ray Wyse, Gavilon senior director of trade and oilseeds. Arable land under cultivation comprises only 20 million acres; however, 198 million acres could be brought into production, according to the United Nations.

The Congo only has half the potential of Brazil with respect to arable land, but it’s capable of producing three crops a year, and it has a massive river in the middle, Wyse says. The Congo River is to the DRC what the Amazon River is to Brazil, a low-cost transportation artery.

That’s the future. The Congo has been besieged with political trouble, corruption and a civil war now ended that cost 5 million lives. Things are better today than a decade ago, yet the country cannot feed itself. Three-fourths of the population are underfed, life expectancy is just over 40 and average incomes are less than $500 per year.

Still, There Is Hope. In July, the government announced a plan to modify a law that restricts foreign agricultural ownership, hoping to attract investors for a $5.7 billion expansion. The program is part of an effort to grow ag by 6% per year.

"There is no excuse for Sub-Saharan Africa (including the Congo) not to be self-sufficient in food production," says Bob Thompson, University of Illinois professor emeritus of ag economics. 

congo chart

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FEATURED IN: Top Producer - September 2013

 
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COMMENTS (1 Comments)

Rounder
With that country's history of corruption and political instability, not to mention almost non existent infrastructure, investment would be economic suicide.
7:04 AM Sep 10th
 



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