Bamboo Lota: The Dream for a Sustainable Malawi

I. Executive Summary
II. The Problem
III. Mission
IV. Vision
V. Social Impact
VI. Theory of Change
VII. Solution
VIII. Monkey Bay, Malawi
IX. Target Market
X. Competition
XI. Risks and Opportunities
XII. Social Marketing
XIII. Partnerships
XIV. Impact Monitoring and Evaluation
XV. Implementation Timeline

I. Executive Summary

     Bamboo Lota hopes to bring environmental, health, and economic improvements to poverty-stricken Malawians through the establishment of a diverse bamboo company.  “Lota” means “to dream” in Chichewa and our dream is to bring real, positive change to the lives of impoverished Malawians through the use of bamboo products. 

      During the last 15-20 years, bamboo has developed as an exceptionally valuable and superior substitute for wood. Bamboo-based products are hard and durable and valuable for construction. Because of bamboo's ability to replace wood in many industrial applications, it will contribute to the saving and restoration of the world's forests. It has tremendous potential for economic and environmental development and international trade.

      Although Bamboo Lota plans to use bamboo in many products, our main focus is on charcoal.  Bamboo Lota aims to replace traditional depletion of forest biomass for charcoal production with a fast-growing bamboo alternative while bolstering local rural economy. Rural villagers would learn from us the tools necessary to successfully maintain and harvest bamboo while gaining knowledge on the importance of ecological stewardship. Moreover, our bamboo charcoal would be produced cleaner using improved kiln technology. The bamboo would be planted on customary land owned by local title holders. The opportunity for a sustainable source of income makes this forest-based activity more commercially attractive than other land usages.  

      Charcoal is often seen today as a backwards and obsolete fuel source. However, for the majority of the population in Malawi, charcoal usage is a way of life. The charcoal trade, if regulated, is a vastly immense market that has the capability to become a top agricultural earner alongside tobacco and tea. In addition, powdered charcoal when used as a feed additive for cattle can increase production of milk and improve meat quality; this is crucial for a lagging dairy and meat industry. Charcoal is produced from the timber and wood of local forests and has led to much of the deforestation and environmental degradation in the country.  

      The business would formalize the value chain for charcoal by employing producers on the plantation, transporters between nodes of business, and retailers in rural, peri-urban, and urban areas. The community members would become stakeholders in the growing bamboo market and in the future be able to transition from charcoal production to various other demandable bamboo goods.

II. The Problem

      90% of the population in Malawi is reliant on charcoal for household use. The problem is that three-quarters of the 14 million people make up the bottom of the pyramid and cannot afford cleaner alternative fuel sources such as ethanol or electric stoves.1 The domestic market for bamboo charcoal is vast; however, the government neither recognizes nor legalizes it. This informal charcoal trade has created unsustainable deforesting practices by Malawian loggers and has led to rapid destruction of the environment over the past two decades. Between 1990 and 2005, Malawi lost 12.7% of its forest cover, or around 494,000 hectares.2 Unlike bamboo which can be harvested in 3-5 years, it takes trees of hard and soft woods typically 10-50 years until they are harvestable. Therefore, the act of reinvesting in the next cycle of harvest is nonexistent and ultimately diminishes resources for the rural poor in the future. Yet, many Malawians’ only source of income comes from charcoal production. Coupled with the inability to access basic loans, the dependency on this illegal trade is a vicious poverty trap. As more and more trees are consumed, many families whose livelihoods depend on charcoal are becoming increasingly strained. 

      There have been increased pressures from the Animal Health and Livestock Development Director to produce better quality beef in the southern region. Inflated prices of beef, due to a shortage from Foot and Mouth Disease, left many Malawians unable to buy this staple meat. Furthermore, a lagging diary industry meant that 50% of all diary products in Malawi were imported.3 Unstable fluctuation in prices from rising and falling supply make poor, inelastic households vulnerable to financial burdens.

III. Mission Statement

      Bamboo Lota’s mission is to improve the deforestation and fuel crisis in Malawi by allowing rural entrepreneurs to take charge of their own bamboo business. By operating a sustainable bamboo growing system, the company can optimize the triple-bottom line which will create positive returns to profit, people, and the planet.

IV. Vision 

      In order to benefit rural Malawian communities we seek to provide job opportunities for locals, to educate the community on how to grow and maintain bamboo, to allow members to eventually take control of the enterprise, and to provide cleaner fuel in a more sustainable practice. 

      We are first starting the company as a non-profit and then moving it into a social enterprise. After the first six years, we will exit out of Malawi, subsequent to providing for the enterprisers the experience and knowledge necessary to take charge of their own business. In addition, we are looking into providing for additional markets for the bamboo product. During the six years, Bamboo Lota will go above and beyond expectations to ensure that the enterprisers will be able to market bamboo properly, and to gain the conviction and insight necessary to be lifelong leaders for fundamental change regarding business and cleaner alternative energy solutions. 

V. Social Impact

           Bamboo Lota will have a positive impact on the residents living in Monkey Bay, Malawi in a number of concrete and meaningful ways. Our venture will take sustainable roots in the community through the establishment of a market-based business which thrives on local inputs, human and physical. By giving local Malawians ownership of the project, they will assume responsibility over Bamboo Lota’s operations and have a personal stake in Bamboo Lota’s success. Once the company has assumed production of bamboo into charcoal, a more sustainable product will be on the market, allowing local Malawians to learn about and try a product that has a gentler environmental impact and creates a healthier environment for their families and children. Not only will our bamboo charcoal reduce the deforestation epidemic in Malawi and reduce the prevalence of respiratory illnesses, it will provide cattle farmers with a fortification and supplemental product to increase their cattle’s milk production and quality.

VI. Theory of Change

     If we can provide start-up capital to invest in one year-old bamboo shoots, train and hire local Malawians to harvest the bamboo, turn it into charcoal, and sell it to other Malawians, then Malawians will have a sustainable source of income, a more sustainable fuel source, and better environmental and physical health. Thus, we seek to help bring Malawians out of poverty through a new business venture which will ultimately become sustainable and locally owned and operated.

VII. The Solution

      Bamboo Lota will help create an income source for the rural poor, replace traditional charcoal production with renewable and cleaner biomass, and educate about environmental and health benefits. 

      Bamboo Lota is a low-cost and low-maintenance alternative to the currently illegal practice of deforestation, which many Malawians partake in due to poverty and inaccessibility to energy resources. First, Bamboo Lota will market the project to angel investors by showing off the company as an environmental and social project. Bamboo Lota will seek three Malawian workers to help start the bamboo charcoal enterprise, which will first be structured as a non-profit for the first three years, during which bamboo shoots will be planted. An additional three workers will be trained as educators of environmental and health. In another three years, the Bamboo Lota will be turned into a social enterprise. Finally, after providing the fundamental base and knowledge of growing bamboo charcoal, we will follow our exit strategy and leave Bamboo Lota in the hands of the Malawian workers. 

      Bamboo is a versatile product, but we will first be concentrating on making bamboo charcoal. Charcoal is a product with many uses in many levels. It is utilized: at the village level, by blacksmiths and for households; in the domestic sector, as fuel for cooking and heating; in the industrial sector, at different scales of activity, in furnaces, for forging and metal-working; and as raw material for further processing into activated carbon and other industrial products. Wood and charcoal are the preferred cooking and heating fuels in Malawi, even in the poorer parts of cities, and the demand is huge: Loggers illegally clear 100 square miles of forest each year just to meet the demand for charcoal.4 Therefore, because the market demand is so high, Bamboo Lota will ultimately provide for the triple bottom line in addition to high returns. 

     Finally, Bamboo Lota’s business plan can be scaled for other bamboo products, such as for building material, flooring, apparel and cloth, alleviating the smell of cow manure, increasing milk production in cows, and many other domestic products.

VIII. Monkey Bay, Malawi

      Monkey Bay lies on the shore of Lake Malawi and is one of the main ports there. Monkey Bay has a police station, a hospital, markets, and an internet café.

     The residents of Monkey Bay (totaled to be about 14,000) live far below the poverty line at perhaps some might call the “existence line.” Few homes can afford electricity.

      Weather in Monkey Bay is subtropical, with the rainy season occurring from about November to May and the dry season occurring from about May to November.5

       Monkey Bay’s severe poverty, lack of jobs, and subtropical climate make it an ideal starting location for Bamboo Lota’s operations.

IX. Target Market

      Initially, Bamboo Lota will target the average Malawian consumer. This market has a couple of different subsections we will target: the consumer who currently uses wood and/or charcoal made from wood as fuel; and, the local cattle farmer, because the venture will provide the famer with resources (i.e. the bamboo charcoal) to raise healthier and meatier cows, which in turn produce more milk to sell.

       Thus, the venture seeks to target the local consumer who currently engages in illegal practices of cutting down trees for fuel and those who raise cattle, in order to scale the production of bamboo and the transformation of bamboo into charcoal. 

X. Competition

       Bamboo Lota will be competing first with traditional modes of energy production- things like firewood, and charcoal made from trees. However, these traditional methods contribute quite significantly to the massive deforestation practices, and are officially legal within Malawi. Bamboo Lota offers several new attributes to the market: creates income sources for entrepreneurial rural poor; opportunities for Malawians to enter the bamboo market while simultaneously making charcoal; opportunities for improved cattle health; cleaner and renewable fuel/biomass; healthier families; sustainable production; faster growth and replanting is unnecessary.

XI. Risks and Opportunities

      Bamboo is a low risk crop because of its extreme versatility and resilience. It requires little external resources and can prosper even in extreme environments. Pilot projects in Kenya have shown that it will yield as many as 20,000 culms per hectare per year, with each culm growing to a height of 12 meters (40 feet). The bamboo species eventually chosen would be non-invasive. The local workers would be trained to control and monitor the growth of the bamboo to ensure that local flora and fauna are not jeopardized.

      Bamboo Lota’s risk comes from the instable political structure coupled with the rising strain on agricultural lands. 

      The opportunities are limitless. Currently bamboo is not a cultured crop in Malawi and thus, there are no businesses that offer the products and services Bamboo Lota plans to provide. The bamboo can be used for charcoal, food products, and construction materials. Bamboo charcoal also offers benefits beyond acting as a traditional energy source. Bamboo charcoal improves the quality of livestock when integrated into their feed, filters water, and lengthens the lifespan of other fruits and vegetables. It also is a cleaner burning fuel, reducing carbon emissions and harmful particulates which cause respiratory illnesses

XII. Social Marketing

      To target Malawian consumers, Bamboo Lota will explain and advertise the environmental benefits of bamboo products, most specifically bamboo charcoal.  We will stress the benefits of a bamboo company not only for the environment, but also for a stable and secure standard of living.  Through employing and giving ownership to local bamboo cultivators and entrepreneurs, Bamboo Lota will be showing the Monkey Bay community that it is a sustainable and beneficial venture for the community.   Bamboo Lota will also improve health within the community by providing families with cleaner burning fuel.

      Bamboo Lota will target investors by touting the environmental and health benefits of bamboo.  Investors will also gain satisfaction through formalizing an legalizing the charcoal industry and the creation of jobs for many poverty stricken families.  Finally, the venture will become sustainable and earn a profit.

XIII. Partnerships

      Partnerships will be made with the owners and operators of existing kilns, local microfinance institutions (MFIs), cattle farmers (producing dairy products and meat), and the International Development Research Centre. The International Development Research Centre (IDRC) has completed bamboo projects and done extensive research in Kenya, China, India, and Malawi. This is our most formal partnership, as it gives us pre-existing research and operations expertise. However, our partnerships with the local businesses and entrepreneurs are crucial in Bamboo Lota’s success. Without the partnerships with local kiln operators, MFIs, and cattle farmers Bamboo Lota would not have access to local networks of entrepreneurs, local expertise and creativity, and knowledge of local customs and operations.

XIV. Impact Monitoring and Evaluation

       Bamboo Lota will utilize a series of social and biological metrics to evaluate its success in alleviating poverty in Malawi through creating and diversifying economic opportunities available to locals. Biological metrics include: measuring the air quality of Monkey Bay, in parts per million; the rate of soil erosion; the total amount of carbon dioxide sequestered; and the prevalence of deforestation practices. Social metrics include: the average life span; income levels; the number of diagnosed respiratory illnesses; and the number of children in school.

     These metrics will be evaluated every year after the third year of operations, at which time the bamboo will have grown and ready to be made into charcoal.

XV. Implementation Timeline

Year One:

-Set up infrastructure to implement health and environment social marketing programs

-Set up supply chain between producers and retailers

-Hire local workers (Four to work the land and two for education)

-Plant bamboo on two hectares of land and educate works on how to maintain

Year Two:

-Market ecological stewardship to neighboring rural villages

-Built improved, cleaner kilns for bamboo charcoal pyrolysis

Year Three:

-Continue planting and maintaining bamboo crops

-Begin process of creating bamboo charcoal

-Establish distribution channels

-Expand amount of workers to three field workers per grove, and one additional educator

Year Four:

-Continue distribution and marketing

-Open markets to northern regions of Malawi

-Monitor and evaluate current progress

Year Five:

-Diversification of bamboo into other markets (expand into using bamboo as materials for construction and building)

-Exit strategy: Transition management roles to local Malawian workers

For more info contact: info@bamboolota.org