Zollinger Investment Limited is an agricultural company set up for vertical integration on Avocado, medical cannabis & Livestock. The company is registered in the Zambia & UK with office in Kenya. In 2016, the company bought 10,556 hectares (26,084 acres) of land in Zambia as it moved from Narok Kenya where it had been doing wheat farming since 70’s. Biodiversity is the origin of all crops and livestock and it’s this basis together with huge market that made Zollinger focus on mix production of avocado, mango, honey, medical cannabis & livestock products.

 

Zollinger will support smallholder farmers tap the avocado and livestock opportunities while utilizing its facility. The establishment of Avocado nursery and Livestock Disease-free Zones is of great benefit not only to company but will go a long way in increase increasing farmer’s income and impact their livelihoods.  Zollinger is founded and formed by Dr. Ali Hassan its Chairman and led by CEO Peter Chemuigut, a key leader in success in Agricultural Development in Kenya. Zollinger aims to embedded at the highest levels of Zambia government

Main Goals

  • To develop product that matches the needs of the customer at a price acceptable.
  • Maintain strict compliance with quality and delivering it as agreed with our buyers.
  • Operate strong communication to our customers as we persuaded them buy our accessible products.

Mission

  • To provide any customer with a year-round supply of high-quality products.

Main Objectives

  • Net annual income to support operational
  • Sales and capacity increasing steadily throughout the first

Products & Services

Zollinger specialize on avocado, medical cannabis & beef vertical integration by offering seeds, value addition and marketing.  Its success is achieved by offering quality products through economies of scale that seeks to reduce production cost as it reduced barriers to market. The combination of avocado, medical cannabis & livestock production, together with mango and apiary provides harmonizes biodiversity ecosystem with each enriching other & meets today market demands.

  • Avocado Nursery. Avocado seedlings will be provided to its farms and out growers
  • Avocado Orchard. A 1,000 acres avocado orchard will be established together with 150 acres of Mango orchards & beehives along the edges of farm to aid on pollination.
  • Avocado packaging & Processing. Sixty percent of fruits from its orchards and from out growers farms will be package for exported to the EU wholesalers and distributors. Likewise, Forty percent of fruits from its avocado orchards and that from out growers will be processed into avocado oil for export markets. The honey processing and mango drying is also included.
  • CBD oil. Zollinger is to establishing a commercial growing and production facility for medical cannabis and CBD oil of which Zollinger to being issued license by Zambia Government in return Zollinger is to pay % of net profit share from its sale and export
  • Livestock Center.  The unit will have a 1,000 acres Livestock Disease Free Zone with Semi-Feedlot & Semen Center for production of Conventional Semen, Sexed Semen & Liquid Nitrogen. 1,500 acres will be set up for production of silage &  hay  along Feed Mill

Key Partners

Zollinger focuses on business partners essential in optimizing its business in providing market, technology, & capital.

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Market Opportunities

AVOCADO; The booming global avocado demand is causing prices to rise, according to 2020 global avocado market research published by Transparency Market Research (TRM); global revenue generated from avocado market is estimated to be valued at US$ 13,641.2 Mn by the end of 2018 and is expected to increase at a CAGR of 5.9% over the forecast period. By the end of 2026, the market will possibly attain a value worth US$ 21,561.8 Mn.  The health benefits of avocado fruit are staged as the major marketing strategy.  Zollinger could make the most of these market opportunities through avocado vertical integration.

Zambia has distinct natural competitive advantages for avocado cultivation and export as its soil and climate conditions are well suited to avocado cultivation, however, avocado exports in Zambia have been low because farmers do not grow avocados demanded by international markets. With several players in the food market exploring suitable areas for avocado Zollinger has edged in positioning Zambia by utilizing its recently acquired 26,084 acres of land couple with its expertise in technology

CBD Market; Despite legalization of growing and processing cannabis in few countries, today’s cannabis industry is still struggling to define itself as a profitable and viable commercial business.  The industry is facing huge obstacles as it struggles to meet global demand. In addition, many countries are still only in the initial phase of legalization and are simply trying to catch up to their industry counterparts. All are facing similar, if not identical, government resistance and regulation

In the Zambia, although growing and processing cannabis has been generally passed through its legislation, the framework for obtaining license has not been finalized.  Zambia has competitive advantages for cannabis cultivation and processing as its soil and climate conditions are well suited in which it can compete well with other Africa counties like Uganda, Zimbabwe and DRC Congo. With several players in the cannabis industry exploring suitable areas for growing and processing cannabis for medical Zollinger is positioning on utilizing part of its recently acquired 26,084 acres of land.

 

LIVESTOCK; Zambia Livestock exports in past did so well and contributed 10% of foreign exchange earnings. That ceased in the 1980’s due to the breakdown of disease that forced imposed bans. The Common Market for Eastern and Southern African Countries (COMESA) that includes Zambia is endowed with the highest population of livestock and therefore huge potential for intra-regional trade, as well as untapped markets including that of Middle East and Europe.

 

The livestock sector increasingly becoming an important component of Zambia’s economy and forms a critical part of the Zambian economic offering unique potential for poverty alleviation, food security and wealth creation. This potential, however, remains largely untapped due to various reasons, and where trade in live animals takes place, it is predominantly informal. Livestock contributes about 3.2% of the national GDP and up to 42% of the agricultural GDP.

 

An estimated 83% households keep at least one type of livestock. Animal rearing is largely for subsistence purposes, with sales mainly occurring to raise cash during times of distress. According to the central statistics office (2017) estimates, the country had 4.98 million cattle, 4.82 million goats and 149,420 sheep. Zambia is a significant producer of livestock in the COMESA region although the populations are relatively low

To tap in to the market and position Zambia, Zollinger will set up Livestock Disease Free Zone with Semi-Feedlot & Bull station to offer semen, sexed Semen & liquid nitrogen. Deficit countries such as DRC, Seychelles, Burundi and Mauritius present ready markets within a preferential trade area for Zambia of which Zollinger is to position using Livestock Center that will benefit small-scale farmer.

Start-up Summary

The business will be fully funded with $20,00,000. This will include total capital cost of $9,581,274, leaving $10,418,726 as working capital for the first 3 years. It has already invested $6M towards the purchase of 6,500 acres of land for setting up the business..

Capital Expenditure Year Working Capital Yr. 1 Yr. 2 Yr. 3
Component 2022 Component 2022 2023 2024
1 Avocado Nursery $35,212 1 Avocado Nursery $40,200 $37,400 $37,400
2 Avocado Farm $1,450,800 2 Avocado Farm $1,259,800 $180,800 $224,800
3 Avocado Pack & Process $1,454,780 3 Avocado Packing $0 $0 $315,468
4 Cannabis Oil $3,993,740 4 Cannabis Oil $746,468 $880,976 $1,399,713
5 Livestock Center $1,964,800 5 Livestock Center $1,318,700 $1,357,100 $1,357,100
6 Administrative $681,942 6 Administrative $412,680 $420,934 $429,187
 Total $3,777,848 $2,877,210 $3,763,668
Total Capital Expenditure   $9,581,274    3 Years Working Capital $10,418,726
Total Capital Expenditure & Working Capital 2022-2024    $20,000,000  

Financial Offtake

Zollinger will fund its startup costs largely through the financing investment of $20,000,000, It expected to generate the first avocado harvest in year three which is 2024.

Cannabis Revenue
     

 Year >>>

2022 2023 2024 2025 2026 2027
1 Land Production Arces 247 494 988 1482 1976 2470
2 Total Plant Population (# of Transplants Per Acre) 1500 1500 1500 1500 1500 1500
3 Percent of Transplants Harvested/Marketed 95% 95% 95% 95% 95% 95%
4 Average Dried Floral Material Per Plant (lbs)                      1                  1                 1                1                 1                 1
5 Total Harvested Dried Floral Material             351,975         703,950      1,407,900     2,111,850      2,815,800      3,519,750
6 Projected Cannabidiol (CBD) % of Dry Matter                       0                  0                  0                 0                  0                  0
7 Price Per % CBD Oil $1.50 $1.37 $1.24 $1.11 $0.98 $0.85
8 Revenues from Extracted Ingredients 5,279,625 9,644,115 17,457,960 23,441,535 27,594,840 29,917,875
TOTAL 2022 – 2027        >>>                           113,335,950

 

Funding Arrangements

Zollinger  is seeking to finance $20,000,000 on 50/25/25  from two lenders and investor through share equity. As projected on its Financial Model, the main loan will be $10,000,000 at rate 7% with grace Period of 3 years and subordinate loan with 5,000,000 at rate 7% with grace Period of 3 years. It is imperative to note that potential financiers have reviewed the project and willing to finance it with presence of off take in the three products; Avocado, Livestock and Cannabis.

 

Social Impact Summary

Transformational Change; this project will create impact at our firm, market for small holders farmers  and improve livelihood in the community,  key among project transformation change includes; New infrastructure is built in community, Income Improvements, Smallholder Participation in Export markets, Accessible Service & Improve Skills to farmers, Increase Foreign Exchange  & Taxes, Community Development, Increase Exports From Zambia, Delivery Safe Food & Meds, Corporate Social Responsibility (CSR), Agro ecology Increases Climate Resilience.

The project will introduce new product to Zambia Community, open in new market for its farmers and removing bottlenecks in value chains in avocado & livestock sector. The project will create 266 direct jobs with $ 5,376,420 salaries in 6 years with more than 3,500 casual workers opportunities. More than 20,000 smallholder farmers will benefit from avocado out growers project while the livestock project is to increase income of 100,000 small-holders’ farmers.  Below is summary value chain sector;

Avocado Sector; the Zambian avocado industry has not performed optimally due challenges including: not accessing international markets, inadequate linkages and reliability of supply, inadequate sectorial organization, marketing strategy, insufficient understanding of quality requirements in export market. The avocado project will address above challenges and increase the export capacity, support farmer to meet the export market via nursery, pack house, processing availed to farmers; This is projected to  improve the Zambia avocado’s value chain

Livestock Sector; Zambian livestock enterprises have been dwindling to an extent it cannot meet the market demands due to challenge on livestock value chain and thus cannot tap into export market within Africa & Middle East. The Zollinger Livestock Center project will address this challenge by offering semen & access to market. This intervention is expected to directly benefit over thousands small livestock farmers by providing them with increased income and encourage the growth of the livestock sector.

Medical CBD oil; Through strategic agreement with the Zambia Government, Zollinger to being issued license and right to cultivate, harvest, process, sell and export the product, in return Zollinger  to % of net profit share from the sale and export of cannabis biomass and CBD oil to the Zambia government for a term of up to 50 years.  From these proceeds, new infrastructure is built in the community, including schools, youth centers of excellence, hospitals, community centers and housing.

Corporate Social Responsibility (CSR); Zollinger will focus on training farmers on avocado production & livestock production alongside student training on Artificial Insemination Training.  Likewise it will support servicing and supply chemicals to community cattle dips through its livestock programZollinger will pay % of net profit share from its sale and export of medical cannabis and CBD oil to Zambia Government.  Zollinger is very conscious of the impact it makes to communities of the Zambia & it’s involved its government as it’s improve its economic, social  and tangible environment.

Increases Climate Resilience; Agroecology  adopted by Zollinger increases climate adaptive capacity and reduces the vulnerability of agroecosystems, mainly through improved soil health, biodiversity and high diversification of species within agricultural production systems. From our success, there will be ncreased investment in scaling up Agroecology  in strengthening farmers climate resilience.

 

For more information contact Geoff Hindmarch via email editor@cannabisoilresearch.com or

Peter Chemuigut on email chemuigut@gmail.com