Safi Organics

North Kinangop Junction, Kenia

An Overview Of Our Solution

Rural smallholder farmers in Sub-Saharan Africa pay 2-3 times the world price for fertilizer. Due to high cost of fertilizers and due to farmers’ limited disposable income, they can often only afford the cheapest, synthetic varieties. Such synthetic fertilizers, over the long term they actually can acidify and degrade the farmers’ soil. Samuel’s grandmother, for example, saw her field’s maize harvest decrease. We decentralize/downscale the fertilizer production process using our technology that is low-cost and portable. This enables us to set up village-based fertilizer plants that use locally available resources and labor, eliminating the high mark-up of imported fertilizer. In Kenya there are 4 million farmers facing this issue, spending $75 million/year. In the world, we estimate this fertilizer spending is $1.5 billion/year.

Who is this solution impacting?

Community Type

Rural

Organization type

Corporación/Sector Privado

Ecosystem (select all that apply)

Deserts

Forests

Grasslands

Population impacted

20000 people to date

Size of agricultural area

1000000000 ha

Production quantity

150,000 kilos

People employed

8 people

Describe your solution

We use technology to decentralize and downsize the fertilizer production process, making it feasible to implement localized fertilizer production in rural villages using only locally available resources, labor, and waste. Because we eliminate the long-distance fertilizer transportation, we also drastically reduce the fertilizer cost while offering farmers a much higher-quality product. Our product, Safi Sarvi, is a locally produced carbon-negative fertilizer that helps smallholder farmers improve yields by up to 30%. Our technology, validated and tested at Massachusetts Institute of Technology (MIT), utilizes torrefaction, whereby agricultural waste is treated under moderate heat in air-controlled environment in order to rapidly break down the long cellulosic chains. The resultant carbon-rich substrate is then mixed with special nutrient recipe (dependent on the soil and crop requirements) into a standalone fertilizer, Safi Sarvi. Farmers who use our product earns between 20-30% additional income from the increased harvest. In addition, our carbon-rich substrate stays inert in the soil for hundreds of years – and therefore for every acre of land that uses our product, we are effectively sequestering 1.7 tons of CO2 equivalent from the atmosphere. Currently we own and operate our pilot village-based production (0.5 tons/day), and will scale via a business franchise model.

Describe your implementation

Take the example of Mr. Kibuchi, a rice farmer in Mwea, Kenya who owns a 1-hectare plot. For the past 20 years, he has been dependent on urea and other synthetic, acidulated fertilizers that are imported, paying about $520/ton for such product. Nonetheless, in recent years, he has seen the crop growth gradually decrease. Back in 2015, our marketing team reached out to him to explain the benefits of our product and he reserved a small portion of his farm to test our fertilizer. Immediately in the next harvest season, he has seen improvement, and after 3 growing seasons, he now completely uses our product and has seen his income boosted by 20%, for the same price that he pays for fertilizer traditionally. That is sufficient to send 2 children to school and buy a new tractor for his farm last year. In Kenya, there are 3 million fertilizer-dependent farmers like Mr. Kibuchi tilling acidified soil, growing at about 4%/year. We have also observed similar communities in other Sub-Saharan African countries and India, primarily on oxisol or ultisol-dominant areas. We estimate the total market size to be about $15 billion/year and growing. The company currently holds the trade secret and brand trademark (in Kenya) related to the formulas added to the carbon-rich substrate in order to complete the nutrient. We face a risk of Competitive Input Uses: There may be other waste-to-product companies that will compete to get the same farm waste from farms. This is unlikely to be a significant risk, because even if there exists such a need, the sheer amount of biomass in the region is so much that it is unlikely to be easily exhausted Another risk Quality Control: As we expand, one immediate risk is that of quality control. While of the initial farmers, the input feedstock quality has been consistent (mostly rice husks), there are a variety of other agricultural types. Different feedstock types are currently being tested at MIT laboratory.

External connections

We are working with Massachusetts Institute of Technology (MIT), in order to further develop and upgrade the underlying technology in order to make it more efficient. Currently we are also working closely with the Kenyan Bureau of Standards (KEBS) in order to certify our product as a fertilizer. We have been engaging them in the past 1.5 years for various stages of product testing and vetting, and we are in the final stages of certification, which is expected to be completed by December 2016. We have also worked extensively with the K enya Agricultural & Livestock Research Organization (KALRO) in testing the efficacy of our fertilizer blend before our product went commercial. Even now, as we are making new nutrient formulations for different crop types and soil conditions, we still work with KALRO on an ongoing basis to validate these new formulations as part of our active ongoing R&D. While our beneficiaries are smallholder farmers, our main customers are local organizations who will sponsor and recruit a locally based entrepreneur to operate our village-based franchises. Initially, we will approach community NGOs such as Jhamtse International. As we expand beyond the initial NGO market to rural farming cooperatives/mills in Kenya

What is the environmental or ecological challenge you are targeting with your solution?

Most fertilizers in the world are produced in large-scale, centralized, and capital-intensive production facilities (costing millions of dollars in capital), mostly located in Europe, China, and the Americas, and then shipped to the emerging markets such as Sub-Saharan Africa. Due to the long-distance logistical and importation mark-up, a rural farmer in Kenya, such as Mr. Kibuchi, pays 2-3 times the world price for fertilizer, and this figure is anticipated to rise to 5 times by 2050. What is worse, because of Kibuchi’s limited income, he can only afford the cheapest, synthetic, low-quality fertilizer varieties that while in the short term may boost his crop growth, but in the long term actually degrades/acidifies his soil

Describe the context in which you are operating

Current fertilizer production involves a trade-off between capital expenditure and operational complexity. Most large centralized fertilizer production processes (e.g. OCP, Mosaic) are very capital-intensive (US10M+ in capital investment) but are reasonably efficient in operations. Due to the centralized production, it costs tremendously in transportation to get such product to our target market in rural areas in emerging economies. On the other hand, there are many small-scale, decentralized composting projects (such as Sanergy) that are inexpensive to set up, but takes excruciatingly long (it takes weeks to months to complete), and therefore operationally expensive. We have worked with many of these projects in the past (primarily in the Kenyan and Indian context), and have visited numerous composting technologies to understand their fundamental economics. From a comparative analysis with these alternatives, our process costs roughly the same as traditional composting to install, but is 100 times faster (we can process agricultural waste into fertilizer in a matter of 2 hours). We therefore push the current frontier in the CapEx-OpEx trade-off, and do things both faster and cheaper in the fertilizer industry. At the same time, as a side benefit, our solution also sequesters carbon into the soil in the form of carbon-rich substrates from biomass torrefaction. This also uniquely sets our solution apart from the traditional fertilizer production processes.

How did you impact natural resource use and greenhouse gas emissions?

Our business,has three environmental benefits. Firstly, our product is carbon-negative: by applying the Sarvi fertilizer to their soils, the farmers are sequestering about 1.5 tons/acre of CO2 equivalent from the atmosphere. Secondly, in terms of agricultural waste disposal, our solution eliminates the prevalent wanton burning of waste. A recent study from Stanford (Jacobson, 2014) showed that burning biomass waste contributes to 18% of all global carbon emissions, as well as 5-10% of global deaths due to air pollution. Therefore, indirectly, we are reducing pollution and improving public health. In fact, per ton of our product sold, we estimate that we will reduce the following atmospheric pollutants: methane (1.2 kg), carbon monoxide (9.7 kg), NOx (110 g), particulates (1.1 kg), and black carbon (120 g). Finally, as our soil conditioner can also reverse negative soil acidity, this also leads to improved soil viability in the long-term, which increases the growth of the plant. This has seen a greener environment.

Language(s)

English, Kikuyu

Water

Our fertilizer has the capability of retaining water upto ten times its weight, which prevents water loss through evaporation, saving up to 33% of irrigation water use.

Food Security/Nutrition

Farmers who use our product earns between 20-30% additional income from the increased harvest.

Economic/Sustainable Development

we expect each village-based project to create $50,000/year of value in the community (additional jobs and improved yield). By 2018, with 10 production sites in operation, with $500,000/year in local value creation.

Climate

Our carbon-rich substrate stays inert in the soil for hundreds of years – and therefore for every acre of land that uses our product, we are effectively sequestering 1.7 tons of CO2 equivalent from the atmosphere.

Sustainability

In the short term (2015-2017), we primarily operate our own pilots in different villages in Kenya in order to maximize control and learning: we buy farm waste directly from farmers, operate our own facilities to turn the waste into soil conditioner, package the product, and then sell the product to distributors and/or directly to farmers. We have demonstrated our production cost to be $138/ton, and we sell the fertilizer at between $160-210/ton, which is what farmers in the area are willing to pay. In the medium term (post-2017), as we show the success of our own processing facilities, we will expand to other areas of Kenya and other countries through a franchising model.

Return on investment

Currently we operate a 1-ton/day pilot production in Mwea that took a cumulative $15k to invest to set up. As we break even in this pilot production by mid-2017, we will set up and operate village-based operations in 10 other agricultural communities in Kenya, and start a test franchisee in a neighboring country (e.g. Uganda). This requires another $250k in capital investment, with an anticipated return of $1M/year in revenue at full production.

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How could we successfully replicate this solution elsewhere?

In the medium term (post-2017), as we show the success of our own processing facilities, we will expand to other areas of Kenya and other countries through a franchising model. Local entrepreneurs, with our support and the support of locally based NGOs, will be responsible for setting up their own community-based waste-to-conditioner value chain, including finding local distributors and attracting customers from his/her own communities. Here, at a cost-recovery fee, we will provide training and technical/business package to help local entrepreneurs start their own operations. We will then charge a franchise fee of 7% on the revenues from these operations. In the long term, as we reach scale (>10 tons/day), we will also consider carbon credit as a secondary source of revenue, as our product directly sequesters carbon from the atmosphere. However, because carbon credit takes a long time and complexity to set up, we are not dependent upon it as our primary source of revenue.

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About us

Overview