Charcoal is a widely consumed product with a well-established global market, reporting activity of $5.88bn in 2018 (PS Market Research). In light of the growing worldwide climate change response global demand has shifted toward ‘cleaner’ charcoal products, specifically avoiding production based on tropical rainforest hardwoods. As a result, the demand for sustainably sourced FSC accredited charcoal has increased. This demand is a critical opportunity to create a commercially viable industry facilitating the clearing of Invasive Alien Plant biomass utilizing rural 100% black-owned SMMEs to sustainably harvest and provide FSC accredited charcoal for local and export markets.
Inhlabathi Investments has undertaken three years of research and development into biomass-based value chains (through Avocado Vision’s Green Business Value Chain programme with DEFF), and has identified business opportunities in Green Artisanal charcoal product markets in South Africa and globally. We have partnered with the FSC (Forestry Stewardship Council); CMO Group Scheme (Certification body and provider of Chain of Custody certification to allow for global market access) and various local partners in various Geographies that includes Matatiele, to roll out a number of Green Artisanal Charcoal processing plants across South Africa, with the aim of becoming the major FSC charcoal producer and exporter in South Africa, supplying to local and international markets. Through a partnership with GIZ and DEFF, we are being supported by the Namibian Charcoal Association for technical support and expertise as they are two years ahead of South Africa in selling FSC charcoal to European and American markets at significant scale.
Our future strategy is to become the premier producer of Green Artisanal Charcoal in South Africa. We will set up 25 – 30 charcoal factories around the country and incubate, equip and procure charcoal from approximately 375 black-owned, rural SMMEs who will, in turn, employ and up-skill about 2250 rural employees. Matatiele is our most mature ‘startup’ project where we are testing all the moving parts in supply chain and logistics, but we have many sites that are currently under discussion.
In Matatiele the processing plant will provide offtakes to approximately 25 charcoal producers producing 1 ton a day of FSC charcoal, and provide 175 local rural jobs in the supply chain, and 8 jobs in the plant.
We will supply FSC certified charcoal (licence number FSC-C150700) into the local retail market initially, followed by a target of fulfilling a substantial part of the latent 100,000 ton-per-annum FSC export market into Europe and the US once the processing plants are set up.