Rural warehousing facility feasibility study

FBSA Rural Supplier Development Programme

ECRDA has appointed iSpaza Projects (AIM member) to assist the RED Hub Mills craft a route to market for their 4 500 tons of annual production of white maize.

Part of the project’s logistics strategy involves the establishment of district warehouses. Local Economic Development Agencies have endorsed this idea and iSpaza is negotiating with ECDC to identify suitable sites to optimise distribution costs within the RED Hub project footprint of the four mills in the project.

The project further seeks to use the same logistics system to bring a range of other rural supplier products to market through this shared facility.  iSpaza has successfully negotiated vendor listing and supplier agreements with the Spar Eastern Cape Distribution Centre for the RED HUB Mills white maize products.

This will see the product being put onto shelves next year. This will catalyse the need to match the product service and logistics footprint to the RED HUB Mills (Ncora, Mqanduli, Mbizana and Lady Frere) to the localized customer bases in the project. AIM will be observing this project from a distance and assisting where needed within reason of the AIM institutional capability.

District Multi User Facilities

In the previous quarter, DEDEAT commissioned a feasibility study for the establishment of district pack houses/processing facilities for fresh and processed fresh produce in the province. Amongst the main deliverables of the study is an attempt to address the displacement of local producers by the vast volumes of produce being imported for consumption in the EC. The fresh produce being imported into the province by more aggressive and efficient suppliers. This trend is to the benefit of local markets but to the detriment to local producers in respect of land utilization, job creation and enterprise development.

DEDEAT has appointed a service provider to conduct this strategic study. These multi user facilities can be modelled on the national agri hub plans formulated by Dept of Agriculture.

It appears that one of the major challenges that this project will need to address is the collaborative structures into which these stakeholders would need to organize themselves in order to improve their competitiveness and suitability to meet the demands of the market place across the complete value chain. AIM will follow the study closely to observe if it will deliver the “practical” solution that is required to make the desired economic impact.

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