Published On: Tue, Mar 29th, 2016

Transforming Tanzania’s agribusinesses through the southern corridor

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When the 2015 rice buying seasons opens in June, Peter Dotto will look back with satisfaction. For the first time in many years as a struggling farmer, the father of six will pocket as much as eight times his average earning from a handsome harvest.

Dotto’s two acres piece of land in Kilombero district, 450km South-West of the commercial city of Dar es Salaam, yielded an astonishing 16 tonnes of rice compared to about two tonnes that he used to get from the same land.

What’s more, he has a ready market for the entire produce. Dotto will also freely negotiate the price with the buyer, a break from the norm in which middlemen reigned supreme.

For Dotto and 7,300 other rice growers across 11 villages in the district, the establishment of Kilombero Plantations Limited (KPL) could not come at a better time.

“Not only do we now have a ready market for our rice but also get a reasonable return on our toil,” the farmer said of the recently established large-scale rice growing scheme that is helping poor farmers in Kilombero raise their fortunes and change their lives.

KPL, a subsidiary of UK-based agribusiness (Agrica), is a partner in the Southern Agricultural Growth Corridor (SAGCOT), a public-private partnership that seeks to modernize the agricultural sector through high value investments in the Tanzania’s southern corridor.

SAGCOT works as a catalyst of partner organizations to incubate initiatives around inclusive, sustainable and viable agricultural value chains that engage with smallholder farmers. The plan targets both local and foreign investors.

By 2030, SAGCOT partners seek to bring 350,000 hectares of land under profitable production, transition 100,000 small-scale farmers into commercial farming and create 420,000 new employment opportunities.

The plan aims to uplift two million people out of poverty and generate $1.2 billion in annual farm revenues. This, analysts say would be the turning point in the green revolution.

Official details show to date, SAGCOT has registered more than 70 partners, with another 30 prospective investors pledging $1 billion under the G8’s New Alliance for Food Security and Nutrition, launched in 2012 by President Barack Obama as part of a grand initiative to transform the future of farming and food production. Tanzania is a member of the initiative and is collaborating with development partners (Donors) to achieve its goals.

For people like Dotto, the ideals of SAGCOT will become clearer as his pay day nears. “As a member of the KPL Kilombero rice scheme, Dotto will have the unfettered opportunity to determine the cost of his produce,” explained Mr Frederick Jailos, an official at KPL.

“A majority of the farmers in the scheme were trained on how to increase their harvests and will be selling to us some 7,000 tonnes of rice in June alone. We will offer them the market price or negotiate an acceptable rate,” said Mr Jailos.

The Agricultural Council of Tanzania (ACT), a farmers’ umbrella body, says the KPL success in the short period of time goes to prove how positive reforms could impact the lives of the majority of the poor peasants.

ACT’s chairman Dr Sinare Sinare says replicating the success throughout the SAGCOT area will be a boon to farmer communities and help achieve Kilimo Kwanza goals to drastically transform the agricultural sector.

“We support the mainstreaming of smallholder farmers in the SAGCOT value chain plan which we view as a viable vehicle to change the lives of impoverished communities that rely on agriculture for survival.” ACT operates as a bridge between farmer associations and cooperatives with companies and institutions whose activities relate with agriculture.

Tanzania’s Minister for Agriculture, Food Security and Cooperatives, Mr Stephen Wassira, says another significant project would be the roll-out of the 3,500 hectares Bagamoyo Sugarcane Out-growers Scheme (BASOGS), also in the SAGCOT corridor.

Planned for implementation in the 2015/16 fiscal year, the mammoth investment will turn 2000 smallholder farmers into commercial growers while benefiting thousands others living in the 22,000 hectares around its nucleus.

The minister is optimistic of its spill-over impact on small and big business, arguing that it empowers farmers to stay on their land, while producing for a market in their vicinity.

The minister assures that no farmer will be evicted to pave the way for investors as stipulated in the SAGCOT principles.

President Jakaya Kikwete believes the country will record even faster economic growth as anticipate transformation in the agricultural sector takes root. He says the country’s economy last year registered strong macro-economic performance, with the GDP growth expected to rise to 7.4 per cent from 7.3 per cent in 2014. 

Kikwete says inflation dropped from 6 percent in January 2014 to 4.8 percent in December 2014, attributing the drop on an increase in food production.

“In 2014, we produced a surplus of 3.25 million tonnes of grains compared to a surplus of 2.23 million tonnes in 2013. (Therefore) The objectives of Kilimo Kwanza and SAGCOT are working and succeeding,” he says.

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