Farming & Social Impact
Farming & Warehousing Social Impact
The Company recently acquired approximately 5,000 acres of farmland in the Mkushi Region of Zambia.
The Mkushi farm produces the same grains that are in high demand by Sadot Agri-Foods for trading operations (e.g., soybean, wheat, and corn, etc.). The farm also grows Tommy Atkins Mango and Hass Avocado.
About
Sadot Group’s recent expansion into Farm Operations aligns with the Sadot Group's strategic vision of increasing margins through vertical integration and placing the Company in a strong position to deliver sustainable solutions to the ever-growing demand for food and feed. This growing demand is expected to make farmland increasingly scarce and constrain supply on a global basis.
Accordingly, the Company’s acquisition of almost 5,000 acres of farmland in Zambia’s Mkushi Region has the potential to deliver multiple accretive benefits.
- Potential to provide a steady and reliable supply of grains and tree crops, which are currently experiencing constant demand and yielding higher margins. In addition, the consistent production of these farmed products has the potential to elevate our trading operations with more sophisticated types of trades along with the associated higher margins.
- The asset purchase is expected to improve access to global credit facilities, allowing for larger agri-commodity trades and improved margins.
- Potential to provide a fresh source of revenue by operating as a regional hub for smaller farmers. By providing future warehousing and distribution services for their products, the Sadot Group will not only aid these farmers in reaching wider markets and may also help them optimize their agricultural practices.
Opportunities
Contract farming with the holders of small farms (~2,500 acres each, over ~7 million acres in aggregate).
- Sadot Group has the potential to originate inputs (upfront purchases that a farm requires to begin production), manage the farms commercially with an offtake agreement in place securing a profit for the farmers as well as for Sadot Group at about 10% of topline. Sadot Group has the potential to capture small farm holders with regional government support.
Additional opportunities include: 1) Expansion of acreage under ownership, 2) Diversification of crops, 3) Warehousing/Hub Operations – not only for Sadot’s own crops but for the region at large, facilitating year-round selling, and 4) AgTech improvements to improve yields.
