VZCZCXRO2161
RR RUEHMA RUEHPA
DE RUEHCO #1229/01 3560613
ZNR UUUUU ZZH
R 220613Z DEC 06
FM AMEMBASSY COTONOU
TO RUEHC/SECSTATE WASHDC 9104
INFO RUEHRC/USDA FAS WASHDC
RUEHDK/AMEMBASSY DAKAR 1303
RUEHAR/AMEMBASSY ACCRA 1352
RUEHZK/ECOWAS COLLECTIVE

UNCLAS SECTION 01 OF 02 COTONOU 001229 
 
SIPDIS 
 
SIPDIS 
 
DEPT FOR AF/W:DBANKS AND AF/EPS:TLERSTEN 
DEPT PASS TO USTR:LAGAMA 
FAS USDA FOR FAS/FAA:HAGER, FAS/OCRA:DIABY, FAS/OCBD:EVANS, SMITH, 
RUBAS 
AMEMBASSY DAKAR FOR FAS HANSONR 
AMEMBASSY ACCRA FOR AID KNIGHTM, BOTTENBERGH 
 
E.O.12958: N/A 
TAGS: EAGR EAID BN
SUBJECT:  REGIONAL AGRICULTURE ATTACHE VISIT TO BENIN/GOB PLEA FOR 
ASSISTANCE WITH AGRICULTURAL INPUTS 
 
REF: COTONOU 1187 AND PREVIOUS 
 
¶1.  Summary:  This is an Action Request - please see para 6. 
Regional Agriculture Attache Robert Hanson traveled to Cotonou Dec 
17-20 and met with Embassy Staff, newly-appointed Minister of 
Agriculture Dovonou, the Permanent Secretary of the 
Interprofessional Cotton Association, the West Africa Rice Research 
Center, and Catholic Relief Services.  Ag Attache conducted a 
preliminary round of Cochran Fellowship program interviews.   Ag 
Attache also traveled to Bohicon to visit a SONAPRA (state owned) 
and a private ginning facility.  The visit provided valuable 
insights into key issues involving the organizational structure of 
the cotton sector and some of the current problems faced by the 
sector.  Seed cotton production for the coming harvest is currently 
estimated at 300,000 MT. The day after the visit, the GOB sent a Dip 
Note repeating a request for US support on agricultural inputs.  End 
Summary. 
 
COTTON REPORT 
------------- 
 
¶2.  The newly appointed Minister of Agriculture is enthusiastic and 
eager to become more engaged in strategic and development activities 
in the cotton sector.  The government recently called for a review 
of the tendering process for fertilizer and pesticide inputs.  The 
government also recently set the farmer seed cotton price and in 
doing so also lowered the level of support that the 
Interprofessional Cotton Association (AIC) would receive to 5 CFA 
per kilo from 20 CFA per kilo.  Some sources indicated that the 
remaining state-owned gins (SONAPRA) would be privatized after the 
2006/07 campaign. The Minister and his staff were quick to nominate 
new candidates for the Cochran Fellowship cotton program. 
Candidates proposed are active in research and extension work. 
 
¶3.  The Permanent Secretary and staff of the Interprofessional 
Cotton Association (AIC) provided a comprehensive overview of 
Benin's privatization process and some of the current problems still 
faced by the sector.  The sector faces perpetual financial 
difficulties caused in part by rising input prices, high 
transportation costs, high energy costs, exchange rate fluctuations 
and low world cotton prices.  Logistical problems include late 
procurement of inputs, distribution problems and diversion of 
fertilizer to food crops.  In the current year sufficient quantities 
of a key pesticide were not procured and farmers were reluctant to 
use a substitute due to previous experiences.  AIC also made a plea 
to be able to nominate candidates for the Cochran Fellowship 
program, noting that as private sector representatives, they should 
play a greater role in future training and development programs. 
 
¶4.  Benin's ginning capacity is just short of 600,000 MT.  With 
production currently forecast at 300,000 MT, AIC will allocate 
quotas to the various mills at approximately fifty percent of their 
capacity.  Once a mill receives a quota, it is required to pay 40 
percent of the cost, which will be used in the procurement of inputs 
for the next campaign.  Considering that some mills are in financial 
difficulty, and some have a bad track record with respect to working 
with the AIC, the quota allocation process is likely to be somewhat 
more complicated than it appears.  Cotton ginning should begin in 
the next couple weeks.  Cotton has already begun to be harvested and 
is being weighed in the villages before being delivered to the 
gins. 
 
¶5.  COMMENT:  The Benin cotton sector is distinct from the other C-4 
countries to the extent that it is privatized.   The AIC -- which 
represents the producers, ginners (both public and private) as well 
as the input distributors -- considers itself to be a private sector 
entity.  While Benin's cotton sector has more private sector 
components than other C-4 countries, the linkages and balance 
between the public and private players has lead to many of the 
well-documented problems faced by the sector.  The government and 
Ministry of Agriculture, which is represented in the AIC via 
SONAPRA, the state-owned ginner, appears to be prepared to again 
play a stronger role in the sector.  The US-funded West African 
Cotton Improvement Program (WACIP), which is just becoming 
operational, offers great potential to address numerous 
inefficiencies in the sector, but will have to work delicately with 
all the players to ensure that the program is well received and can 
have maximum impact.  END COMMENT. 
 
¶6. ADDENDUM AND ACTION REQUEST: The day after the Ag Attache's 
visit, on December 21, the Embassy received a Dip Note from the GOB 
on cotton.  The note recalled a working meeting between the Beninese 
 
COTONOU 00001229  002 OF 002 
 
 
and US delegations on the margins of the June 30-July 1 Commercial 
Negotiations Committee of the WTO.  The GoB's note says "the US 
delegation promised to study the possibility of providing support 
for agricultural inputs, particularly to the four countries, 
including Benin, of the Sectoral Initiative, while awaiting for 
solutions to be found at the level of the commercial aspects of the 
cotton dossier."  The GoB note goes on to ask for a favorable 
outcome of this study, to aid the GoB in making the next cotton 
season a success.  ACTION REQUEST:  Post would appreciate Washington 
guidance on whether any support for agricultural inputs is being 
considered.  END ADDENDUM AND ACTION REQUEST. 
 
RICE AND FOOD AID ISSUES 
------------------------ 
 
¶7.  A visit to the Africa Rice Center (WARDA) revealed an impressive 
research center that has worked to develop a high-yield and 
resistant variety of rice - NERICA, or New Rice for Africa - that 
has wide potential in Subsaharan Africa.  A return visit by the Ag 
Attache will be planned to coordinate how the research center might 
collaborate with USDA and other donors on regional food security, 
agriculture development and commercial activities. 
 
¶8.  Catholic Relief Services (CRS) will begin implementing a 
McGovern-Dole Food for Education (FFE) program once commodities 
arrive some time in January 2007.  CRS is phasing out its Title II 
programs.  The USDA program will provide meals and take home rations 
for two years, at which time parents and faculty should begin 
providing food for the schools.  This model has been used by CRS in 
their Title II program. 
 
HOLTZAPPLE