Welcome to Lona
Citrus is a well-established agricultural commodity for South Africa and has experienced steady export growth over the past 5 decades, growing from 10 million 15 KG equivalent cartons in 1965 to 117 million 15 KG equivalent cartons in 2015. South Africa has an excellent reputation internationally as a good quality exporter. Following the deregulation of the industry in 1996, a number of citrus exporters established themselves in the country. One such company, that has continued to grow from strength to strength since inception, is that of the Lona Group (Pty) Ltd.
“Lona is now one of the 5 largest exporters of citrus products in SA.”
The group comprises of a number of entities and joint ventures that successfully contribute to agricultural development in South Africa through the production and export of citrus products. The group is involved in activities from the start of the value chain (farming and packing) up until the final step (export). This allows for control and reliability of the internal operations of the companies and it also increases the synergies within the network. Involved at each point in the supply chain, Lona has developed and specialised in input aggregation, pack-houses, cold storage and marketing and has continued to grow from strength to strength over the years.
Lona’s transformative business model combines business sustainability, wealth creation for Previously Disadvantaged (PD) farmers, supply chain security, strong buyer relationships and the socio-economic development of farming communities. This model has enabled the group to maintain a position of strength both domestically and in the international arena and demonstrates the companies’ commitment to the developmental necessities of South Africa.
Farming & Bulk Procurement Services
Lona has been farming for close to a decade after the initial farm investment in 2006 in the Eastern Cape. Today, Lona’s farms are to be found in the Limpopo province, the Eastern Cape and the Western Cape. The company has an expansion and development program on its existing operations that will enable it to grow substantially in the next 10 years. These farms mainly produce citrus, with Lona Citrus being ultimately responsible for the marketing of the crops produced. Other crops include mangoes, grapes, pears, plums, avocados, pomegranates and various vegetables.
The company assesses the input requirements of all the farms involved with the Lona Group and negotiates more cost efficient terms with suppliers. The prices and payment terms negotiated by Lona are naturally better than what the individual farms are able to achieve, as we are able to not only offer scale to input suppliers, but much more importantly, central and secure payments.
What we do...
Lona Citrus (Pty) Ltd (the export company) is one of the country’s top 5 largest exporters, now shipping approximately 4.5 million 15 KG equivalent cartons of citrus per annum. Lona Citrus operates internationally, exporting fresh citrus produce to 40+ countries around the globe including customers in North America, Western and Eastern Europe, Russia, Central Asia, the Middle East and the Far East (including Japan). The company sources its fruit from independent producers, as well as from farms that it either fully or partly owns or manages, in the Western and Eastern Cape, KwaZulu Natal, Mpumalanga, Limpopo and Zimbabwe. Lona’s customers which include many of the world’s leading wholesalers and supermarkets in the above mentioned regions import the whole basket of its citrus fruit, listed as follows: Navel oranges, Valencia oranges, Soft Citrus (Clementines, Mandarins and Satsumas), Grapefruit and Lemons.
Lona’s success as an established and reputable exporter was reaffirmed in 2012 when the company was awarded the “Transnet National Ports Authority Trophy” for a non-engineering company that has excelled in exporting in the Exporter of the Year competition sponsored by ABSA and the Cape Chamber of Commerce.
Technical And Advisory
Lona has been managing, mentoring and financing emerging farmers nationwide for the past decade. The business model aims to link emerging growers with our experienced technical and financial advisory team, as well as our extensive international client base, to ensure they become the success stories of the future. Lona is involved with approximately 50% of the active “PD” citrus growers in South Africa. These services include, but are not limited to the following:
- Technical advice is provided on an on-going basis during the season by Lona area representatives. These staff members are all well trained and informed in technical issues.
- Annual road shows by the technical team before commencement of each season keeps producers up to date with regards to quality standards and changes and provides valuable input from producers regarding systems and procedures.
- Assistance is given with applications for special markets and quality compliance registrations.
- Variety selection advice is provided based on market requirements whenever producers are planning on planting additional trees.
- Packhouse management assistance is provided throughout the season, ensuring compliance with the country’s export protocols.
- Quality reports from customers are provided to producers throughout the season.
Agricultural Finance and Administrative Services
The Agri-Finance division of Lona (Grassroots Capital (Pty) Ltd) provides its farmers with financing in an industry where the crop is generally not recognised as collateral for seasonal or expansion loans by financial institutions. Lona is in a unique position to be able to extend financing, monetize the fruit and collect incoming funds before the grower is paid for the season’s crop, effectively limiting the risk of lengthy debt collection processes a normal commercial bank would be subject to. The company adheres to a strict and documented credit policy, is NCR accredited, and has an enviable repayment record. Lona works together with commercial banks and also has facilities in place with development finance institutions, such as the Landbank and Sefa. These services are supplied to the majority of emerging farmers out of our regional hubs in Tzaneen (Limpopo), Nkwalini (Kwa-Zulu Natal), Fort Beaufort (Eastern Cape) and Cape Town (Western Cape).
Information Technology Services
Lona is a vertically integrated producer-packer-shipper of citrus fruit, and thus is represented on all the communication platforms. This key position in the value chain exposes it to many different vendors and products, which creates a steep learning curve. Producers benefit from this knowledge as they are guided with regards to which system suits their operations best. Lona has built relationships with most of the major hardware and software distributors in order to provide the best value for members of the group and their affiliates.
The Lona Way
Compared to similar firms operating in the South African citrus industry, the Lona Group possesses key characteristics that enable it to occupy a growing and unique space within the South African citrus industry. As mentioned, agriculture needs to encompass sustainable and environmentally responsible farming and operation practices as well as ensuring profitable yields, a growing business and farmer and farm-worker well-being.
Lona manages to achieve this through their unique transformative business model which combines: participating at each level of the value chain right up to export ensuring greater control and reliability of internal company operations and supply security; development of strong relationships with suppliers and final market; socio-economic development of farming communities; support and mentoring to emerging black farmers which results in increased returns and markets; and commitment to innovation and research and development with regards to solutions to reducing energy consumption and improved business practices.