Sahel Capital Provides US$1.5mn trade finance

Sahel Capital, a prominent investor in the food and agriculture sector in sub-Sahara Africa, has successfully approved a US$1.5 million Trade Finance loan from its Social Enterprise Fund for Agriculture in Africa (SEFAA) facility. Launched in 2021 with KfW as the anchor investor, SEFAA aims to stimulate economic activities among smallholder farmers by empowering the social enterprises that engage with them.

Acier Limited sources and exports agricultural products such as hibiscus flower, ginger, peanuts, chilli peppers, sesame seeds and cashew nuts to customers globally. The company has developed supply chain links with smallholder farmers (SHFs) in Northern Nigeria, aggregating hibiscus flowers from SHFs, cooperatives, and other aggregators. Acier’s sourcing of hibiscus empowers women in those regions by providing them with jobs and increased income for supplying and cleaning the flowers.

“When we provide social enterprises such as Acier with capital, we allow them to grow their volumes, ultimately leading to a higher offtake from SHFs. These guaranteed markets provide the necessary incentive for SHFs to invest in their yields and improve the quality of their lives from higher incomes,” stated Deji Adebusoye, a Partner at Sahel Capital. “Acier has demonstrated a strong understanding of the market and a real intention for growth and scale, which excites us. We are very proud to support them on this growth journey”.

The facility will enable Acier to aggregate more flowers from its supply chain, including the SHFs, and export more volumes to its international customers. This investment will catalyse economic activity among the SHFs and increase foreign earnings for Nigeria.

Richard Isokrari, MD/CEO of Acier Limited, believes this capital will be transformational to Acier and to the Hibiscus value chain in Nigeria. “As we source more hibiscus flowers from these SHFs, they will be encouraged to grow more flowers and do it productively. This has the ability to make Nigeria a powerhouse when it comes to hibiscus production and export. We are glad Sahel Capital and SEFAA decided to support us on this journey”.

Sahel Capital currently manages two funds: Fund for Agricultural Finance in Nigeria (“FAFIN”) which has investments in SME agribusinesses in Nigeria; and Social Enterprise Fund for Agriculture in Africa (“SEFAA”) which provides primarily structured debt to agribusiness SMEs across 13 countries in sub- Saharan Africa. Sahel Capital is also raising capital for a successor fund – Sahel Capital Agribusiness Fund II, which will focus on investment opportunities across West Africa.