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The Shea Industry's Economic Impact in Africa

Dr. Peter Lovett - plovett@watradehub.comShea Expert, USAID West Africa Trade Hub

Africa’s Shea Zone

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Putting Shea into Perspective

Sudanian Savannah zone3.7 million km2

> one-third land area of USA> one-tenth of Africa

Human population ~200 million

UNEP

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Shea Production

• Area of core shea zone GIS estimate = 2.64 million km2

• Area of zone suitable for shea = 1.15 million km2

• Av. shea tree density = 7 trees ha-1 [parkland density 15-50 ha-1]

• Potential number of shea trees in core zone = 807 million

• Average dry shea kernel yield per tree = 5kg

• Estimate of total ‘potential’ production = 4.04 million metric tons

Boffa, 1995; Shreckenberg, 1996; Lovett and Haq, 2000; Poudyal, 2011; Kelly, 2007; Elias, 2012

GIS calculations, Lovett PN & Naughton C pers. comm.

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Parklands and Sheanuts

Traditional Process – Kernel

1. Harvest (from farm, rarely bush)

2. Accumulate (in piles or pits)

3. Heat? (boil, roasted or left raw)

4. Dry whole nuts

5. De-husk (cracked by-hand!)

6. Dry kernels & store

Traditional Process - Butter

7. Crush kernels (or left whole)

8. Dry-roast (or heated in ash or sand)

9. Milled (or pounded & stone grind)

10. Kneaded (or water-boiled or pressed)

11. Boil oil/fat to dry & clean (filter!)

12. Prepare for use, sale or storage

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Population, Collectors & Butter Consumption

• Entire total shea zone human population = ~200 million

• Rural population from FAO data (~50% urban) = 107 million

• Assume 40% rural consume shea butter daily = 42.8 million

• 21g per person per day = 330,000 metric tons shea butter

• Volume sheanut collection required = 1 million metric tons

• @ 12 bags per ton and one bag per women = ~12 million collectors

150g family of seven per day (Fleury, 1981, Mali); 21g per person per day – (GIZ-Benin, 2012)

FAO population figures (2000) plus 2.3% p.a. growth (Naughton C pers. comm.)

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Country (major stearin producers only: Vitellaria

paradoxa subsp. paradoxa)

Estimated total exports as sheanuts

(t)

Est. shea butter converted pre-export (kernel equivalent of

country crop* t)

Estimated total shea export (t)

Benin** 15,000 10,000 25,000 Burkina Faso*** 45,000 25,000 70,000

Côte d'Ivoire 30,000 10,000 40,000 Ghana 30,000 30,000 60,000

Guinea-Conakry 7,000 3,000 10,000 Mali 60,000 15,000 75,000

Nigeria 30,000 15,000 45,000 Togo 15,000 10,000 25,000

232,000 118,000 350,000 *All figures given as dry kernel equivalent, i.e. 1 ton butter exported requires 3 tons of sheanuts and so butter export is given as kernel (sheanut) equivalent

**Figures for Benin are given as an estimate exclusive of imports from Nigeria

***Calculation of figures for conversion into butter where factory country is different from origin is confounded by customs data

Estimated Example of SETs Annually Exported

• Sheanut Equivalent Tons (SETs) Exported = 350,000 metric tons• @ 12 bags per ton and one bag per women = 4.2 million collectors

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• Traditional tree crop• Millions rural women• Weeks collecting• April to September• Kernel quality defined• Price takers <$150 t-1

• 1,000s of nut traders • Consolidate & finance• Sell >$250 t-1 post-Oct.• Quality challenge• Option to value-add

• < 10 major buyers• Export & process• Price $250-$800 t-1

• Quality challenge• Lack traceability

Industry Needs:• Shared value

• Improved efficiency

• Competitive price

• Sustainability proof

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Jobs Created in Shea Industry

• Women collectors and family apprentices• In the shea zone indigenous & traditional activity (family business no imported labour)

• Processing equipment, firewood & water provision

• Market workers, bag sewing, truck loading, etc.

• Local buying agents and exporters

• Warehouse & truck owners & workers

• Service providers: financiers, certifiers, suppliers of packaging materials, laboratories, shipping firms, etc.

• African-based factory owners and workers (extraction and fractionation)

• European-based factory owners and workers (extraction, fractionation, refining & edible formulation)

• Distributors, formulators (cosmetics), packaging firms & retail outlets (plus service providers)

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Social Impact: Popular 5% Shea Body Lotion

Description Size Assumptions ConversionLotion bottle (ounces) 12

Lotion bottle (grammes) 340 28.35 grammes per ounce

Shea butter in formulation (g) 5%Shea butter per bottle (g) 17

Units sold per annum 10,000,000 1,000,000 grammes per metric tonTotal butter required (tons) 170

Total nuts required 515 33% hand-crafted extraction rateBags per ton 12 85 kg per bag

Bags of nuts per ton 6,064 Number women collectors 6,064 1 (to 3) bag collected per season

Women days per bag processed 3Working days per month 20

Bags per women per month 7Butter per women per month (kg) 187

Women group size per FCL in one month 115 21500 kg butter per full container load

Time for group to complete order (months) 8OR, # processors required in one month 910

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Social Benefits of Shea Income

• Significant women’s livelihood activity

• Pouliot (2012) suggests 12% of poorest households total income

• More jobs & higher incomes, e.g. • School fees paid• Improved family nutrition• Better housing

• Higher incomes to coops & communities • Access to potable water improved• Schools & medical centres constructed

• Fiscal returns of transparent business

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Export Shea Butter Value Chain

Collectors Traders Processors Fractionators Edible Brands

Processors

FractionatorsVillage-based Processors

90%

10%

10%

45%

45%

Representative Organizations:• Village-based processing – by co-ops & firms,

e.g. Burkarina, Songtaaba, SEKAF, Naasakle• WA Processors – Fludor, Nioto, Ghananuts• Int’l Processors – AAK

• WA Fractionators – Ghananuts, Wilmar• Int’l Refiners – AAK, Loders, SRC, Cargill• Int’l Fractionators – AAK, Loders, 3Fs• Brands – Body Shop, L’Oreal

15%

70%

Refiners5%

West African International Kernel Butter Final Product

Legend

* Note, %’s represent volume of SETs in the shea industry as of 2011;; figures do not reflect unrefined shea butter* At present, ~5% of industrially processed total (fractionated/refined) gets used by the cosmetic industryƗ 65-75% of harvested shea does not enter the export market and is retained for traditional uses

85%30%

Cosmetic Brands

15%

Traditional Uses Ɨ Distribution/

Formulation

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