Responsible Commodity Contracts Can Accelerate Africa's Restoration Economy

Across Africa, local companies are harnessing the power of global markets to help farmers restore degraded land. These businesses work within sustainable supply chains, providing seedlings and sourcing products grown from trees that help restore land. When these “restoration champions” thrive, they provide new income sources for the farmers whose crops they buy and process and ultimately help the continent achieve its ambitious restoration goals and adapt to climate change.

As these local companies expand their capacity to buy, process and sell crops like avocados, cocoa, macadamia nuts and citrus fruits, they create jobs in manufacturing and logistics — and incentivize farmers to grow more trees. When grown in the right places using restorative methods like agroforestry, those trees improve food security, repair soils and build resilience to floods, droughts and landslides.

That is why every $1 invested in land restoration can create $7 to $30 in economic benefits, while protecting biodiversity and fighting climate change.

But these companies need financing to scale and contracts that guarantee an attractive price for their products that can help grow sustainable supply chains.

Africa’s Barriers to Investment

Although these enterprises have strong potential for growth and impact, those that would typically raise investment in mature markets like the U.S. and Europe often encounter systemic barriers that limit their ability to scale and deliver results. These barriers include:

Disconnected supply chains: Inadequate infrastructure, fragmented logistics and inconsistent commodity supply hinder processing capacity and growth. In Kenya, failures in cold chain storage led to 40% post-harvest losses for avocados.

• Meeting quality, certification and traceability standards: All buyers require high-quality products that can pass rigorous quality checks. But access to markets with premium prices, like Europe and the U.S., requires more than quality — they demand compliance with certification and traceability standards. Most enterprises lack the resources to meet these requirements. Half of Kenya’s avocados are produced organically, fetching high premiums, but access to export markets is limited for the smallholder farmers producing 70% of the country’s avocados.

• A focus on raw exports: Due to insufficient processing capacity and capital, most enterprises export raw products — capturing a small portion of the final sale price. In Ghana, less than 1.5% of cocoa is exported as finished chocolate.

• Restrictive policy environments: Enterprises operate in unpredictable and often restrictive policy environments. Ghana’s Cocoa Board is a government-owned institution that regulates the production, marketing and export of cocoa, coffee and shea nuts in Ghana. Its strict processes prevent enterprises from entering into direct export agreements for buyers, hurting profit margins.

• Financing gaps: Growing businesses are often too large to qualify for grants, yet too risky for commercial lenders. They often lack sufficient collateral, have a limited credit history and operate in supply chains or countries that are unfamiliar to most investors.

• Limited market intelligence: Agribusinesses in many African countries operate without access to timely information about their markets, which limits their ability to respond to changes in demand and price. In Rwanda and the Democratic Republic of Congo, low digital literacy and inadequate infrastructure isolate rural cooperatives.

Helping Restoration Champions Connect to Capital

To thrive, restoration enterprises need a buyer, commonly called an “offtaker,” who will pay them an attractive, guaranteed price for the commodities that they purchase from their partner farmers. These “offtake contracts” are a standard agreement in agricultural supply chains — from wheat to mangoes — and can be advantageous for all sides in a deal: Farmers know that a company will pay them a set price once they deliver high-quality produce; an enterprise knows that they can sell collected and processed crops at a set price to buyers; and buyers can guarantee their supply of sustainably produced products at a set price. The best agreements put the most money in the pockets of farmers and allow enterprises to invest their profits in tree seedlings, processing equipment or hiring to expand production and restore more land.

But to access this type of trade finance, enterprises need targeted technical support to engage with investors and buyers seeking high-quality, sustainable products. They require detailed financial documentation to prove the health of their business, assistance to navigate the complexities of sustainability certifications to earn premium prices and connections with buyers that are a continent away.

To address these persistent challenges, Regeneration, in collaboration with WRI and the Bezos Earth Fund, created the Market Readiness Technical Assistance (MRTA) Facility to build investment readiness and connect 20 restoration enterprises working in the restorative coffee, cocoa, macadamia, fruit and gum arabic supply chains with offtake contracts. They focused on enterprises operating in the target landscapes of WRI’s Restore Local initiative: Kenya’s Greater Rift Valley, the Lake Kivu and Rusizi River Basin of Burundi, the Democratic Republic of the Congo, Rwanda; and the Ghana Cocoa Belt. 

By building a network of committed supply chain companies that value sustainable commodities, MRTA mobilized $24 million in private finance for seven companies, a six to one return on investment within 16 months. These restoration champions are now on track to restore 13,700 hectares and benefit 9,000 people.

In-depth conversations and hands-on support for enterprises, investors and sustainable commodity buyers identified a few innovations needed to boost this important part of the restoration economy.

1) Flexible Working Capital Is Essential

Over 80% of the more than 100 enterprises engaged by Regeneration cited the lack of working capital as their top challenge. Even when an enterprise signs a favorable offtake contract, they don’t have enough cash to purchase crops from farmers, process them and deliver the crops to a buyer on time.

In most African markets, loans for working capital favor the creditor: They come with high annual interest rates of 20% or more, short repayment periods that leave enterprises cash-strapped and minimum investment sizes that are too large for companies to manage. When they are issued in foreign currencies (like the U.S. dollar or the euro) that local currencies, like the Rwandan franc, depreciate against, companies struggle to repay.

ABOCFA, a certified organic and Fairtrade cocoa cooperative in Ghana, had a confirmed buyer, but they struggled to raise the capital needed to pay their more than 1,000-member farmers a fair price for their high-quality beans. MRTA facilitated a creative solution between the company, offtaker Tradin Organic and Tachibana, a Japanese cacao trader, who provided the upfront capital. This financing sustained operations and fulfilled buyer expectations, but it was a stopgap measure that required significant effort to make it work.

To close this gap, a dedicated investment facility could provide low-interest, flexible investment capital to profitable companies that are operating in core restoration value chains. By using AI to detect trees from space to track the impact of those investments, the facility could tie payments to the verified outcomes of those investments.

2) Value Addition and Certification Drive Profitability and Impact

Enterprises selling fresh fruits, nuts and other produce face volatile prices and thin margins. Two strategies can help them attract more finance and expand impact.

First, adding value through processing, such as pressing avocados into oil or roasting and packaging macadamia nuts, can offer 20% to 40% higher prices than raw commodities. Second, consumers in Europe, North America and the Middle East are increasingly looking for organic and fair-trade-certified produce, which receive 10% to 15% premiums.

Despite the opportunity, enterprises struggle to raise the long-term capital needed to start a new processing line or undergo a months-long independent certification process. This shift to higher-margin models can help African countries retain more value locally and compete on the international markets, long dominated by Europe, North America and Asia.

Biofarms can gain a premium price for its organic avocado and avocado oil with a guaranteed market provided by an offtake agreement. Photo by Monica Kinyua.

Targeted support can help enterprises build their business cases and secure deals for value-addition processing and new certifications. Biofarms, a Kenyan fruit exporter, began processing lower-quality avocados into oil in 2024. While their strategy aligned with rising European demand for organic traceable products, Biofarms lacked the certification and market access needed to sell at premium prices.

MRTA conducted market research and identified Tradin Organic as a strategic buyer. Biofarms refined its product and pitch, securing a five-container deal. Tradin also committed to financing Biofarms’ organic certification, projected to boost margins by 35% to 40%. The partnership is set to benefit 4,000 smallholder farmers and sustainably manage 808 hectares in Kenya, showcasing how targeted matchmaking and certification support can unlock value.

3) Market Intelligence Builds Better Deals for Local Enterprises

Enterprises often lack information on the financing options, regulations and buyer expectations within their value chains. Without access to digestible information, they can’t make smart decisions: An avocado supplier needs to know the going price of avocadoes in European supermarkets to determine if a buyer is offering them a fair price. A macadamia exporter needs to know if demand for organic nuts is rising in Germany to decide whether they should invest in a new certification or a small but promising partnership with a German buyer. A cocoa cooperative needs to understand the premiums that major chocolate companies will pay for traceable beans to maximize profits for their member farmers.

Tropical Mac processes and sells Kenyan macadamia to international buyers. Photo by Monica Kinyua.

Tropical Mac , a macadamia processor in Kenya, was historically dependent on exporting through intermediaries that combined low prices with minimal transparency. Seeking to increase its margins and secure more stable markets, the company turned to MRTA for support. By consulting its database, MRTA identified a U.S.-based buyer interested in direct engagement with smallholder-linked businesses. The team produced documentation that met the buyer’s standards and advised the company at trade fairs and during commercial negotiations. Tropical Mac successfully signed three offtake contracts with higher prices for its network of smallholder farmers.

Only by democratizing access to low-cost market intelligence will local enterprises benefit from a fair playing field as they raise money, partner with more farmers and restore land.

A More Profitable Restoration Economy  

While offtake contracts can channel finance for local enterprises that restore land, they can’t close the financing gap on their own. Investors need to provide working capital that is flexible and tied to verifiable impact along with long-term financing to expand processing capacity and pay for certifications. Buyers can accelerate impact and reinforce their bottom line through long-term sourcing relationships that provide companies (and their partner farmers) with a fair price.

Given the challenges, philanthropies and development finance institutions will need to partner with buyers and investors to catalyze this investment. For their part, governments should review their regulations on exports and taxation to incentivize local businesses to grow. And affordable business development support can provide nascent enterprises with the support they need to successfully interact with financiers.

Even if change happens rapidly, local enterprises can’t close Africa’s financing gap for restoration on their own. Financing innovations that pay for the services that native trees provide are equally important and critical to meet the continent’s climate and biodiversity goals.

But these job-creation engines need help. It’s time they got it.

Blog Post Title Two

It all begins with an idea. Maybe you want to launch a business. Maybe you want to turn a hobby into something more. Or maybe you have a creative project to share with the world. Whatever it is, the way you tell your story online can make all the difference.

Don’t worry about sounding professional. Sound like you. There are over 1.5 billion websites out there, but your story is what’s going to separate this one from the rest. If you read the words back and don’t hear your own voice in your head, that’s a good sign you still have more work to do.

Be clear, be confident and don’t overthink it. The beauty of your story is that it’s going to continue to evolve and your site can evolve with it. Your goal should be to make it feel right for right now. Later will take care of itself. It always does.

Blog Post Title Three

It all begins with an idea. Maybe you want to launch a business. Maybe you want to turn a hobby into something more. Or maybe you have a creative project to share with the world. Whatever it is, the way you tell your story online can make all the difference.

Don’t worry about sounding professional. Sound like you. There are over 1.5 billion websites out there, but your story is what’s going to separate this one from the rest. If you read the words back and don’t hear your own voice in your head, that’s a good sign you still have more work to do.

Be clear, be confident and don’t overthink it. The beauty of your story is that it’s going to continue to evolve and your site can evolve with it. Your goal should be to make it feel right for right now. Later will take care of itself. It always does.

Blog Post Title Four

It all begins with an idea. Maybe you want to launch a business. Maybe you want to turn a hobby into something more. Or maybe you have a creative project to share with the world. Whatever it is, the way you tell your story online can make all the difference.

Don’t worry about sounding professional. Sound like you. There are over 1.5 billion websites out there, but your story is what’s going to separate this one from the rest. If you read the words back and don’t hear your own voice in your head, that’s a good sign you still have more work to do.

Be clear, be confident and don’t overthink it. The beauty of your story is that it’s going to continue to evolve and your site can evolve with it. Your goal should be to make it feel right for right now. Later will take care of itself. It always does.