by Claire Kelly, Regional Director for West Africa/MENA
Submitted by Whole Foods Market Foundations
Whole Planet Foundation traditionally provides our partners with funds to expand their microcredit programs. However, under our “asset finance” model – Whole Planet Foundation can finance the provision of business assets which help low-income individuals to increase their incomes. Our new partner, J-Palm Liberia, has received ≈$88,000 zero-interest loan from Whole Planet Foundation to construct 90 mini-mills in rural Liberia. These mini-mills reduce the processing time of wild palm by 65% and improve palm oil yield by 53% for the smallholder farmer. Each mill can be used by 100 smallholder palm collectors. Therefore, these new mills can increase the productivity, and therefore the incomes of up to 9,000 farmers.
From the J-Palm Liberia website: "Globally, palm oil production often brings to mind multinational corporations clearing large swathes of terrain, seizing local people's land, and destroying animal habitats to create oil palm plantations. However, in Liberia and across most of West Africa, oil palm grows naturally in the wild (dura variety), due to the tropical climate. And in rural Liberia, these palm trees are communally owned, and governed by local chiefs and elders. Still, most of Liberia's smallholder oil palm producing households remain in poverty. While there is no shortage of palm fruit supply, smallholders lack access to modern processing technologies and hence resort to a traditional technique of manually squeezing the palm oil out of the fruit. As a result, over 35% of Liberia's palm fruit go un-harvested every year. During processing, smallholders suffer an additional 53% oil loss due to inefficient manual processing techniques. Traditional methods used to process palm oil, such as pit processing, are highly inefficient and labor intensive."
Started in 2013 by Liberian founder Mahmud Johnson, J-Palm Liberia works to improve production efficiency and sales for smallholder wild palm collectors in rural communities by providing access to modern, more efficient processing technologies. J-Palm manages and operates the mills in partnership with rural communities. Oil palm processors within a certain radius harvest palm fruit from communally owned trees and use the machines to process palm oil at no up-front cost. In addition to purchasing the palm oil, J-Palm sustains this business model by purchasing the palm kernels (hitherto discarded oil seeds, by-product of palm oil production) from the farmers, creating an additional source of income from a resource that was previously treated as waste.
Watch the video to see how the mini-mills work.
The Whole Planet Foundation/J-Palm project officially launched at end September 2021. To date, J-Palm has already installed 70 mini-mills in 24 villages, of the targeted 90 mini-mills. According to J-Palm Founder and CEO, Mahmud Johnson, “Our partnership with Whole Planet Foundation is a model for how philanthropic organizations can partner with socially conscious enterprises to catalyze rural economic development through asset financing, that immediately makes an impact in the lives of smallholder farmers. These machines solve what is essentially a last-mile problem: there is huge market demand for palm oil, yet smallholder farmers suffer huge post-harvest losses. This partnership enables low-income Liberian palm oil producers to increase their yields, reduce processing cost, and double their incomes almost overnight.”
For example, one of the new mini-mills was installed in western Liberia. One palm smallholder, James, who uses the mill, shared this perspective, “With J-Palm, when we use the machine, we get more oil. But with our traditional method, we get less oil because we are not able to process it as well as the machine does.”
With developments in the microfinance sector, Whole Planet Foundation has widened our definition of microfinance to include organizations that support low-income entrepreneurs with in-kind loans of agriculture inputs and business assets. By providing productive community assets to smallholder palm farmers, the J-Palm project works across several of Whole Planet Foundation's approaches. Their specific approach to leverage and scale value chains to include small holder farmers results in increased income opportunities. This is a unique project for Whole Planet Foundation and the team is excited to support other organizations under the concept of "Scaling Value Chains That Benefit Poor Communities", within our portfolio. This is especially relevant now as the global situation around food insecurity and inflation is hitting already vulnerable families the hardest, and Whole Planet Foundation will continue to identify impact-oriented organizations serving this segment.
Learn more at wholeplanetfoundation.org.
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