Agri-processing is not only about factories. It is about capital, market access, management, growers, workers and the future of regional agricultural economies.
For André Kemp, Investment Manager at Norfund, agriculture becomes most powerful when the different parts of the value chain work together. As he puts it, “Agri is an embodiment of that. You need to work together.” That view is central to how he thinks about investment, processing capacity and the future of businesses that connect farms to markets.
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Agriculture does not end at the farm gate
Agriculture is often spoken about at farm level: orchards, crops, yields, labour, weather, pests and production costs. But once fruit leaves the farm, another part of the agricultural economy begins. It is the world of processing, packaging, storage, working capital, logistics, export markets, foreign exchange exposure and customer relationships.
Kemp’s own career has moved through agriculture, finance and investment. He grew up with exposure to farming, but he is clear about where his role fits into the sector today: “Not farming, but investing. I’m not a farmer.” That distinction matters. Agriculture does not only need producers. It also needs capital, structure, governance, management, logistics and market access. Without those elements, even strong production regions can lose value.
Why processing capacity matters
A processing facility is not simply a building with machinery. It is an anchor in a regional economy. It gives growers an offtake market. It supports seasonal and permanent employment. It carries relationships with customers. It converts raw agricultural production into shelf-stable, exportable products. In the case of fruit, that can mean canned fruit, purées, dried fruit inputs and other processed products that move into retail, food service, baby food, juices and related markets.
Kemp describes this kind of business as highly demanding from a capital perspective. In fruit processing, the largest cash requirement is concentrated into a short seasonal window. As he explains, “you need quite a lot of working capital,” and the pressure is not spread evenly through the year. The major buying and processing period can sit in “90 to 120 days, the first four months of the year.” That means the business must have enough capital available before it can generate the full return from the season.
The working capital challenge
This is one reason why agri-processing transactions can be difficult. It is not enough to acquire a factory. The new ownership structure must also be able to fund fruit intake, operations, stockholding, shipping and the commercial cycle. As Kemp says, “given the nature of buying a company like this and then putting in working capital, it’s quite expensive for an investor.”
The Langeberg Foods story illustrates this clearly.
The Langeberg Foods case
The business represented a major agri-processing asset with deep links into the fruit-growing regions around Ashton and beyond. It had export relationships, existing product streams and a role in the regional economy. But it also required the right structure, the right partners and the right capital behind it. According to Kemp, the export side of the business was significant, with “80% of the revenue” linked to exports and predominantly private-label customers. Products moved into food service and retail markets globally, including customers in markets such as the United Kingdom.
That export exposure is important. It shows that South African processed fruit is not only a domestic consumer product. It is part of an international food supply chain. The label may carry another retailer’s brand, but behind it sits South African fruit, South African processing capacity and South African growers.
More than a nostalgic industry
For Kemp, the opportunity was not simply to preserve a nostalgic industry. It was to protect and rebuild a commercially relevant platform. He notes that a business of this nature can be “an extremely good business” if it has the right management team and if the stakeholders understand the realities of foreign exchange, export cycles and seasonal volume.
The structure of the transaction mattered. Norfund was not looking to take control in the way a typical private equity buyer might. Kemp is clear that Norfund’s approach is partnership-driven: “We prefer not to be above majority. It’s not what we do, so we prefer to partner.” He also emphasises that Norfund is “not a private equity company” in the traditional sense, because it works with long-term development capital rather than a short exit cycle.
Why long-term capital matters
That difference matters in agriculture. Many agricultural assets need patience. They need stability. They need investment that understands seasons, biological timelines and operational cycles. A purely short-term view can miss the strategic importance of keeping infrastructure alive.
In the Langeberg Foods case, the changed transaction structure helped unlock the path forward. Kemp refers to the publicly known structure where “the company can be bought for one rand,” but the real issue was never only the purchase price. The real issue was how to capitalise the business properly and align the right shareholders behind it. He explains that Norfund’s role was, in the end, to help bring parties together, because “the big outstanding was somebody to provide working capital.”
That is one of the strongest lessons from this case: sometimes the value of capital is not only in the amount invested. It is in the confidence it gives to the rest of the structure. Banks, farmers, management teams and other shareholders need to know that the business has support beyond the initial transaction.
Community ownership and regional impact
The community and grower dimension is equally important. Kemp sees particular significance in the fact that the business now includes community involvement in its ownership structure. “Given the history of South Africa, I think it’s an amazing story to say that there’s a community now involved as shareholders in the business,” he says. That kind of alignment changes the nature of a turnaround. It is no longer only about preserving an asset. It becomes about linking economic participation to the people and region most affected by the asset’s future.
But ownership alone is not enough. Kemp repeatedly comes back to management. For him, the key change is having “the right management position, that’s correctly incentivised and aligned with the shareholders.” Once that is in place, the role of the investor changes. “We don’t have to do anything,” he says, because “this management team knows exactly what they need to do and they’re doing it.”
Management turns capital into execution
Capital can create the runway, but management must execute. A turnaround does not happen in a spreadsheet. It happens in procurement planning, factory readiness, customer reassurance, logistics, staff leadership, product quality and sales discipline.
The first season under the new structure required exactly that kind of operational focus. There were systems to transition, customers to visit, commercial relationships to stabilise and production plans to rebuild. Kemp says the focus was “to steady the ship and scale the ship.” That phrase captures the immediate and long-term challenge. First, the business must stabilise. Then it must grow.
Rebuilding markets and confidence
There is reason for cautious optimism. Kemp says the factory is not currently optimally utilised and that the ambition is to increase volumes over time. “The fruit is there. It’s not just making sure the market is there,” he explains. That is a critical distinction. Production capacity in the region is not the only issue. The factory also needs market access, customer confidence and enough time for the commercial team to rebuild momentum.
He adds that “we’ve got a factory. We need to use it,” and that the business would like to increase utilisation and diversify what it processes, while remaining fruit-based. This speaks to a broader issue across South African agriculture: infrastructure must be used productively if regions are to remain competitive. When processing capacity disappears, growers lose options, towns lose jobs and export systems lose depth.
Southern Africa’s entrepreneurial base
Kemp’s view extends beyond this single business. He sees Southern Africa as a region with strong entrepreneurial potential, despite difficult operating environments. “It’s always nice seeing businesses, if we invest or not invest,” he says, because “people are entrepreneurial. They’re active. They want to try and make a difference.” He broadens that view from South Africa to Southern Africa, adding that “the people are exceptional in these countries.”
That matters for development finance. Investment is not only about identifying perfect conditions. Often it is about identifying capable people and viable businesses operating in imperfect conditions. Kemp refers to businesses in Zimbabwe as examples of companies that have come through difficult circumstances and continued to thrive. This is an important reminder that resilience is not theoretical in African agriculture. It is often built under pressure.
Export agriculture as a competitive advantage
Exports remain central to his view of opportunity. “From an African agriculture perspective, I think anything around exports is always a competitive advantage given the quality that we produce,” he says. This is a strong statement for South African and regional agriculture. The continent has the production base, the entrepreneurial capacity and the product quality to compete. The challenge is often to strengthen the basics: processing, reliability, logistics, finance, governance, energy and execution.
Energy, infrastructure and agricultural growth
Norfund’s broader work also reflects this systems view. Kemp points out that renewable energy is Norfund’s biggest portfolio area, with the goal of creating “better, greener energy” through platforms that can support generation and the broader electricity value chain. While agriculture is a core focus for his own work, the link between energy and agriculture is clear. Processing, cold storage, irrigation, logistics and manufacturing all depend on reliable power.
The bigger lesson for agri-processing
The future of agri-processing in South Africa will depend on this kind of integrated thinking. Factories need fruit. Farmers need markets. Exporters need customers. Communities need employment. Investors need governance and alignment. Management teams need clear incentives. And the entire system needs infrastructure that works.
The Langeberg Foods case shows that rebuilding value in agriculture is possible, but it also shows that it is complex. It requires more than sentiment. It requires capital that understands the sector, shareholders who are aligned, management that can execute, and markets that can absorb the product.
For Kemp, the opportunity remains significant. Africa does not need to overcomplicate every part of its agricultural growth story. As he says, there is “massive opportunity” in “just doing more of the basics right.” In agri-processing, that may be the most important message of all.
Key takeaways
- Agri-processing capacity is a strategic part of agricultural value chains, not a secondary activity.
- Working capital is often the critical constraint in seasonal processing businesses.
- Long-term capital can help protect assets that short-term investment models may overlook.
- Community and grower alignment can change the nature of a turnaround.
- Strong, incentivised management remains the difference between capital on paper and execution in practice.
- Export-focused agriculture remains one of Southern Africa’s competitive advantages.
About André Kemp
André Kemp is an Investment Manager at Norfund, focused on agri-manufacturing and manufacturing investments in Southern Africa. His career includes experience in agricultural investment and corporate finance, including time at Zeder and involvement in the broader agri-investment environment. His work at Norfund focuses on identifying and supporting businesses where long-term capital can contribute to growth, resilience, employment and development impact.
About Norfund
Norfund is the Norwegian Investment Fund for developing countries. Its investment focus includes renewable energy, financial inclusion, green infrastructure, scalable enterprises and agri-related businesses. In Southern Africa, Norfund invests across several markets, including South Africa, Zimbabwe, Zambia, Mozambique and Malawi. Its approach is partnership-driven, with a focus on long-term capital, sustainable business growth and development impact.
Source note: This article is based on Lucentlands Podcast Episode 137, hosted by Dewald Kirsten and Louise Brodie, featuring André Kemp, Investment Manager at Norfund.
