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Call to enable smallholder farmers to access markets

Agriculture stakeholders have made recommendations on addressing the challenges facing smallholder producers (SHPs) in having access to domestic and international markets.

The recommendations include better use of technology, improving infrastructure, access to finance, capacity building, reconsidering contract farming and investing in SHPs’ organisations.

The proposals were presented on Friday during a breakfast debate organised by Policy Forum under the theme: Domestic and Export Markets: What are the opportunities and challenges facing smallholder producers?

Tabling the presentation, the Agricultural Non State Actors’ Forum (Ansaf) executive director, Mr Audax Rukonge, said the use of technology in resolving the challenges facing SHPs would improve access to information, reduce labour dependency and increase shelf-life.

“The youth with innovative ideas in the Information and Communication Technology (ICT), applications, mobile phones, radio and television should be assisted in increasing the bargaining power,” he said.

On infrastructure development, Mr Rukonge said the public should invest in irrigation, cold-chains, ports, airports, roads and railway networks as well as in rural energy connections in order to build an enabling environment for primary processors.

He said investment in the development of strategic storage facilities including warehouses close to border posts should be prioritised to increase efficiency.

Regarding improving financing, he said innovative business credit packages to accommodate players, considering lease and purchase agreements, and integrated value chain funding, should be heightened.

“Contract farming should be put into consideration to increase productivity, the quality of products and marketing. This should go in line with accelerating development of the National Agriculture and Livestock Insurance Scheme (NALIS),” he said.

He said investment and capacity building were needed in SHPs organisations in order to assist them in organising, producing, searching for markets, enhancing bargaining power, seeking alternative decisions and defending their rights as business entities.

The recommendations were given after examining the challenges facing the SHPs including the unpredictability of policy decisions that sometimes change within a short period.

“SHPs are also facing the challenge of limited knowledge and skills in good agriculture practices, and production of small tradable volumes mostly of low quality. Also, there is the challenge of crop and animal risks and market price volatility,” he said.

According to him, the SHPs operate under poorly developed infrastructures, inefficient transportation facilities, poor electricity supply and limited support in research, extension, financial as well as insurance services.

He said unstructured marketing systems, limited market information, ICT applications and the dominance of intermediaries and agents or middlemen were the other challenges adversely affecting the SHPs.

Furthermore, he said high tariffs and non-tariff barriers as well as prolonged bureaucratic procedures that increase transaction costs and reduce SHPs incomes are the other issues of concern.

“The access to financial services and insurance cover that include lending portfolio against the process and higher interest retail market rates as well as weather variability and climate change are the other challenges adversely hampering agricultural productivity,” he said. However, he said the SHPs significantly contribute to over 80 percent of food requirements, producing a surplus of 3,792,562 tonnes in the 2020/21 season. He said, according to available 2021 statistics, the surplus constitutes 1,678,480 tonnes of cereals and 2,114,082 tonnes of non-cereals products.

Analysing the livestock sector, Mr Rukonge said it grew by 5 percent in 2020, contributing to 1.7 percent of the Gross Domestic Product (GDP).

According to him, the sector contributes 30 percent in the agricultural GDP, 40 percent of the beef production, 30 percent of milk and small ruminant and poultry production respectively.

“742,524 tonnes of meat was consumed domestically in 2020 which is expected to increase to 867,302 tonnes reaching 2022. However, local beef production is expected to satisfy 15 percent of the population as of 2031 raising demand for the gap closure,” he said.

Regarding the dairy sub-sector, Mr Rukonge said over three billion litres of milk is produced annually; 70 percent and 30 percent from improved and unimproved breeds respectively.

He said while 90 percent of produced milk is consumed at farm level, only three percent proceeds to processors.

“Since 2008, the sector grew at an average of 5.3 percent per annum. However, its consumption remains relatively low at 49 litres per capita as compared to 53 and 120 litres for Uganda and Kenya respectively. The World Health Organisation (WHO) has set an annual consumption forecast of 200 litres per capita,” he said.

He said Tanzania produced three million pieces of hides and skin in 2015 that increased to 11.77 million pieces in 2021.

The amount increased from Sh22.8 billion from 160,000 tonnes that grew to Sh23.9 billion from 167500 tonnes between 2015 and 2020.

Mr Rukonge said less than 10 percent is produced domestically against high domestic demands for footwear estimated at 46.8 million pairs annually as compared to 300,000 pairs produced locally.

He said the horticulture industry grew between nine to 12 percent annually, employing 2.5 million people; 65 to 70 percent being women.

“The value of exports grew from $64 million in 2005 to $374 million in 2013 and later to $779 million in 2019. But, SHPs from the 70 percent of vegetable producers operating at less than two hectares,” he said.

Regarding the fisheries sub-sector, Mr Rukonge said as of April 2021, 422,859.78 tonnes of fish worth Sh2.62 trillion were produced and sold in the formal and informal markets.

However, only 11.14 percent goes into the export market in the regional countries of Rwanda, Burundi, the Democratic Republic of Congo (DRC), Zambia, South Sudan, Kenya and Malawi.

The Tanzania Trade Development Authority (Tan-Trade)’s representative, Mr Deo Shayo, said his authority has invited members of the private sector for the capacity building training.

“We will make a market analysis to increase their understanding on what is worth exporting and those can’t be exported because not all products can be traded outside the country,” he said.

Mr Goodluck Massawe from the Sokoine University of Agriculture (Sua) said demand for insuring agricultural products was of paramount importance.

“Insured farmers produce with confidence and at any cost as they are prevented from future uncertainties such as disruptions of markets,” he said.

Ms Shariffa Chikaka of the East African Grain Council (EAGC) said investment in the number of agricultural extension officers to support the SHPs should be increased.

“Instead of purchasing expensive vehicles, leaders should balance their demands and those of the SHPs who feed the population,” she said.

Mr Julius Wambura from the Rice Council of Tanzania (RCT) said access to the market wasn’t an issue, rather how requirements are met and markets are maintained. “We have about 21 million hectares that can be irrigated, but only 600,000 hectares are irrigated. We should strategize and increase the size in order to increase production and feed the region,” he said.

A farmer, Ms Marcelina, said there is a variation on priorities, noting that while the government focuses on producing crops that will increase revenue, citizens’ concern was on food security.

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