by Ben Taylor

Fertiliser subsidies announced
There was much relief among farmers in Tanzania when the government announced measures that mean they will enjoy a large subsidy over fertiliser during the 2022/23 season. This was revealed as President Samia Suluhu Hassan launched a subsidy programme in August.

A bag of DAP fertiliser that was previously sold for TSh 131,675 will now cost TSh 70,000 only, while that of Urea, which used to fetch TSh 124,714, will also cost TSh 70,000 only. Other types of fertiliser see similar price reductions as a result of the subsidy.

The measure acts as both a cushion against rising fertiliser prices linked to rising fuel prices, and as a driver of the government’s “Agenda 10/30” that aims to attain 10% annual growth rate for the agriculture sector by 2030. The current annual growth rate is around 2%.

Speaking in Mbeya, President Hassan urged farmers to make better use of the opportunity by increasing agricultural efficiency and yields for domestic consumption and export.

“While the government has set aside funds for fertiliser subsidy, I would like to ask farmers to cultivate commercially to enable us harvest enough food so we will export the surplus,” she said in a televised address. “Generated funds should enable us establish the Agriculture Development Fund (ADF) for providing assistance to farmers during fertilizer and inputs price shocks.”

The President also directed regional, district, ward and village leaders to closely monitor farmer registration so as to identify beneficiaries. “For efficient implementation of the programme, I should insist that all fertiliser bags must be properly labelled and every firm registered to supply subsidised fertilizer should identify its agents in regional and district levels,” she instructed.

“The ministries of Agriculture as well as Finance and Planning should ensure subsidy funds are released on time ahead of farming seasons,” she added.

The fertiliser subsidy programme comes within just weeks after the government more than tripled the budget for agriculture from TSh 251 billion in the 2021/22 financial year to TSh 951 billion in 2022/23.

“It is now clear that agriculture will grow at an enhanced rate. The focus on irrigation means that ours will now be a sustainable agriculture as opposed to the one that is dependent on rain,” said Jacqueline Mkindi, chairperson of the Agricultural Council of Tanzania. She added that the private sector believed the government was going in the right direction as far as the agricultural sector was concerned.

by Ben Taylor

Agricultural Transformation Agenda Launched
On April 4, 2022, President Samia Suluhu Hassan launched an “agri­cultural transformation agenda”, detailing a range of measures to improve agricultural productivity. Under the heading “Agenda 10/30”, these measures aim to produce a 10% annual growth rate for the sec­tor by 2030, up from 2% at present. The slogan “Kilimo ni Biashara” (Agriculture is Business) has been prominently used.

First among the new measures is the government’s desire to see com­mercial banks lower their interest rates when lending to the sector. The President urged banks to provide a single digit interest rate on loans to the agriculture sector. She said this was of paramount importance in shaping the agriculture sector and increasing its contribution to the economy.

“CRDB Bank is already charging a single digit interest rate to nine per­cent. I am positive NMB Bank, which is currently charging 10 percent, will follow suit. I will be even more happy if you go to eight percent,” said President Hassan.

Tanzania Bankers Association (TBA) chairman Abdulmajid Nsekela, also the Managing Director of CRDB Bank, expressed commercial banks’ commitment to addressing the challenge of access to capital that farmers were grappling with. He said currently the agriculture sector was accounting for less than 10 percent of the loans portfolio mainly due to lack of collateral.

“Some 14 banks have signed contracts with Tanzania Agricultural Development Bank (TADB) for it to issue guarantees that will enable farmers to access loans,” he noted.

NMB Bank said it was fully supportive of the government’s ambitions to radically transform the national farming sector into a commercially driven modern enterprise, saying the lender was already using its financial muscle to propel the sector’s growth, having injected over TSh 1.3 trillion into the farming economy and its value chain in the past five years.

The President also instructed the Ministry of Agriculture to establish a Revolving Fund for agricultural inputs and agricultural development, using contributions both from internal sources of revenue and from development partners. “At a time when prices for agricultural inputs shoot due to external shocks, the Revolving Fund will be coming in to cushion farmers,” she said.

She directed the Ministry and the President’s Office for Public Service Management to review the Irrigation Commission structure, so that it should have offices in each district. Minister of Agriculture, Mr Hussein Bashe, has set a target of raising arable land under irrigation from 2% at present to 50%, which would see around 10 million hectares under irrigation, up from the current 600,000.

Further, the President announced plans to issue a price stability fund for fertiliser (where prices have risen sharply with rising fuel costs) and to establish a common use facility for packing, sorting and grading of horticultural products.

Scaling up extension services is another of the pillars in “Agenda 10/30”. Tanzania reportedly needs some 21,000 extension officers, though there are currently fewer than 8,000. Plans are in place to raise this figure quickly.

Finally, the government announced plans for the treasury to let off land that it holds but which remains idle, giving this instead to investors for commercial farming.

Financing these ambitions will require considerable budgetary resources. In the 2021-22 budget, the Ministry of Agriculture was allocated TSh 294 bn, of which 77% was for recurrent expenditure, leaving just Tsh 65 bn for development spending.

President Hassan has pledged to raise development spending, and Finance Minister Mwigulu Nchemba has hinted strongly that agricul­ture will be one of his top spending priorities in the coming 2022-23 budget.

by Ben Taylor

Drip irrigation system in Tanzania -favoured due to less wastage than traditional sprinkler systems – Food Ethics Council/ACE Africa

Survey report reveals obstacles to greater agricultural production
A new survey by the National Bureau of Statistics (NBS), has identified five key obstacles to agricultural productivity in Tanzania. The report, the National Sample Census of Agriculture 2019/20, named the issues as limited access to extension services, slow implementation of irrigation systems, low use of fertilizers, low use of improved seeds as well as underdeveloped mechanization.

It was revealed that only 5.2% of farmers practised irrigation farming in Tanzania, fertilisers were applied to 20% of cultivated land and 20% of land was cultivated with improved seeds. Hand tools (95%) and draft animals (26.5%) are used on much more cultivated land than tractors and power tillers (10.2%). And just 7% of crop-growing households received any advice from agricultural extension services, down from 67% a decade earlier.

Although use of irrigation has increased compared to a decade ago, the pace of growth remains slow. The report adds that investment in irrigation infrastructure is critically important for the agricultural trans­formation that will be required to adapt effectively to climate change.

Speaking at the report launch, agriculture minister Prof Adolf Mkenda acknowledged that productivity in the sector is still a major hurdle that limits farmers’ earnings and their contribution to the national economy.

He said the contribution of the crop sub-sector to the national’s Gross Domestic Product (GDP) is low at 15.4%, while in total the agriculture sector contribution is also not satisfactory at 26.9%. Livestock contributed 7.1%, fisheries 1.7% and forests 2.7% to GDP.

65.3% of households in Tanzania are involved in some form of agricultural production. It is the main source of income for approximately 36% of households.

In the twelve years since the previous such survey, the number of households engaged in agriculture rose by 34% to 7.8 million, while the overall national population rose by 40% over the same period.

Government priorities in agriculture
The ministry of Agriculture outlined seven areas the government will prioritise in the 2021/22 financial year to boost growth of the agriculture sector. These are research, seed development, extension services, increasing the amount of land under irrigation, strengthening markets for agricultural crops, improving access to inexpensive loans for financing agricultural investments, and improving preparedness against invasion of pests and crop diseases.

Agriculture minister Adolf Mkenda outlined the priorities in the Parliament in Dodoma when tabling his ministry’s budget for 2021/22. He said this was prepared based on the Five Year National Development Plan endorsed by Parliament in February and the CCM Election Manifesto 2020-2025, as well as the instructions issued by President Samia Suluhu Hassan issued in her maiden speech in Parliament.

In her speech, President Hassan said inefficiency was the main challenge facing the country’s agriculture, pledging that investment in the area will be made in the next five years to improve productivity.

The agriculture budget comes to TSh 294 bn, a 28% increase compared to the previous financial year. It includes TSh 3bn for increasing the country’s capacity to fight invasive pests and birds such as the desert locusts, including the purchase of new aircraft for this purpose. Extension services also see a major increase, from under TSh 1bn a year earlier to almost TSh 12bn this year.

While these increases did on balance attract praise from MP and commentators, an article in the (government-owned) Daily News, highlighted that the Kenyan government had allocated around five times as much to agriculture as Tanzania had done. For comparison, Kenya’s GDP and national budget are roughly 50% and 65% higher respectively than in Tanzania.

Avocados – the new green gold?
Close to 9,000 tonnes valued at $30 million were exported from Tanzania in 2020, up from almost zero seven years ago, driven in large part by increasing global demand.

Demand for Tanzanian avocados in particular is said to be higher due to the high quality of the product. The leading markets for avocados from Tanzania are the Netherlands and other European countries, South Africa, Dubai and other Gulf states. Recent years have also seen a big growth in demand from China and India.

It is estimated that over 10,000 farmers across the country are involved in avocado production. They produce an estimated 39,000 tonnes of the fruit each year, but only a quarter of this amount is exported.

Growth in demand has also led to sharp price increases. Farm-gate prices reportedly rose from TSh 450 per kg in 2014 to TSh 1,500 last year.

Commercial production of avocado has until very recently been concentrated in the southern highland regions, specifically Njombe District blessed with adequate water and cool conditions. This led to the construction of a state-of-the-art facility in Njombe where farmers can store their fresh produce and is also a hub to connect with buyers.

More recently, efforts are underway to encourage greater production in the northern regions of Arusha and Kilimanjaro. These regions have relatively easy access to global markets due to the proximity of Kilimanjaro International Airport, which specialises in exporting fresh agricultural products.

Despite the growth, exports from neighbouring Kenya are many times higher than Tanzania, with around 68,000 tonnes exported annually to the international markets.

by Ben Taylor

Kenya-Tanzania dispute over maize imports
In early March, the Government of Kenya announced a ban with immediate effect on the importation of maize from Tanzania and Uganda. The ban was lifted the following week, though not before causing considerable strain on diplomatic relations, and with exports subject to strict conditions.

On March 5th, the acting Director-General of Kenya’s Agriculture and Food Authority, Kello Harsama, directed that the imports should stop after a survey found that maize from the two countries is not fit for human consumption.

“The authority has been conducting surveillance on the safety of food imports into Kenya. The results from maize imported from Uganda and Tanzania have revealed high levels of mycotoxins that are consistently beyond safety limits,” she said in a letter to Kenya’s tax authorities.

Long queues of trucks were seen over the following days at the Namanga border post after the Kenya Revenue authority denied the trucks entry into Kenya.

Tanzania’s deputy minister of Agriculture, Hussein Bashe, said the Government of Tanzania is taking the ban of maize imports seriously. “We are closely monitoring the ban and I can assure business people and the general public that the government will continue to protect its interests,” he said.

Aflatoxins, the form of mycotoxin reportedly found in this case, are naturally occurring toxins produced by certain fungi and can be found on a variety of different crops and foodstuffs including cereals, nuts, spices, dried fruits and coffee beans, often spread during storage and under warm and humid conditions. Aflatoxins are capable of causing disease including cancer.

Mr Bashe who was accompanied by the Tanzania Bureau of Standards (TBS) director general, Yussuf Ngenya, said no official communication has been made to the country.

He said even in the event of one or two incidents the Kenyan government should not draw conclusions to the entire maize industry without involving a wide range of institutions that should communicate during challenges. He added that since Tanzania and Kenya are EAC members their differences should be resolved through procedures governing the regional body instead of tarnishing the image of Tanzania’s produce.

Kenyan millers also faulted the government over the blanket ban, arguing the move will have a serious implication on the price of flour. The processors argued that the government should have only intercepted the maize that has high-levels of aflatoxin and allowed those that meet the set standards to be imported.

By March 11th, the Kenyan government relaxed the ban, but instead introduced tough new restrictions on maize imports. All stakeholders dealing in maize imports into Kenya would be required to be registered, consignments must be accompanied with a certificate of conformity on toxin levels and that traders have to issue details of their warehouses. The certificate of conformity should indicate that the aflatoxin levels comply with the maximum required levels of 10 parts per billion.

“While we strive to give Kenya safe food by addressing the challenge in production system, we equally expect our trading partners to trade safe maize as per the East African Community (EAC) standards,” said Mr Angolo, Kenya’s Chief Administrative Secretary of Agriculture.

Locust alarm in Longido
Farmers and residents of Longido District, Arusha, were thrown into panic in February when their farms were invaded by locusts. The pests, which attacked crops with devastating effects , were first seen in Namanga on the Kenya-Tanzania border and later crossed over into Tanzania.

Longido District Commissioner Frank Mwaisumbe said the locusts spread to many parts of the district. He said he had already contacted regional officials and the agriculture ministry who had promised to send experts as soon as possible.

Longido resident Jeremiah Sanka said they were afraid of their crops being eaten by locusts. “We have sent people to the fields because by this time the maize has started to germinate so if eaten it will be such a huge loss” he said.

President Samia announces priority areas in agriculture
During her first State of the Nation address to parliament on April 22nd, 2021, President Samia Suluhu Hassan announced several priorities for her government in the areas of agriculture, fisheries and livestock.

She said the sector accounts for only 27% of GDP and 25% of foreign currency earnings despite the fact that 65 percent of Tanzanians are farmers.

“This is because of low productivity,” she said. “For instance, while some can produce eight tonnes [of maize] per hectare, Tanzania’s farmers produce only 1.9 tonnes per hectare. In the same vein, a Tanzanian cotton farmer produces 250 kilograms per acre instead of 1,000 to 1,250 per acre.”

She added that the same applies also to livestock, whereby the sector contributes only 7.4% of GDP, despite the fact that Tanzania has the second largest livestock population in Africa.” She said cows in Tanzania produce an average of three litres of milk per day instead of between 20 to 30 litres if modern livestock keeping methods are put in place, and that Tanzanian cattle produce only 150 kilograms of meat instead of between 500 and 600 kilograms in some countries.

To address this, the President pledged that the government will foster investment in improved varieties and livestock keeping technologies through funding research and extension services. “We will give them seeds, capital and allow them to keep producing on commercial basis. That will prevent us from importing seeds because such seeds will be available locally,” she said.

She also promised that irrigation will be given special impetus, pledging to increase the size of land for irrigation from 561,383 hectares to 1,200,000 hectares by 2025. She said this will enable the country to reduce its dependency on rain-fed agriculture, noting that farmers will be required to farm on a commercial basis and contribute towards costs of irrigation infrastructures.

by Ben Taylor

Government allays fears of food shortages
Rising global food prices will have no impact on Tanzania’s food security, according to Permanent Secretary in the Ministry of Agriculture, Mr Gelard Kusaya. “As a country we have enough food and we have never depended on any foreign assistance when it comes to feeding our people,” said Mr Kusaya.

Mr Kusaya was responding to a report by the Food and Agriculture Organization (FAO) which said prices of the most globally traded food commodities rose sharply in November to their highest levels in nearly six years, a situation that was putting extra pressure on Tanzania’s food security. The agency named Tanzania as among 45 countries that would continue to be in need of external assistance for food.
In its quarterly Crop Prospects and Food Situation report, FAO stated that there are localized shortfalls in staple food production in Tanzania. Manyara, Kilimanjaro, Dodoma and Singida regions were mentioned as areas of concern.

But Mr Kusaya said currently the country’s food stocks are nearly 3.5m tonnes, with adequate food supply as the weather favours farming activities across the country.

“There are only three commodities that Tanzania imports from abroad which are wheat, cooking oil and sugar. The government is strategising to make sure that we reduce the import levels by producing these commodities locally,” he said. (The Citizen)

Cashewnut production misses target
Cashew nuts production will be short of target by over 20 percent this year, according to projections by the Cashewnut Board of Tanzania (CBT). Earlier projections had put the cashew nuts production at 278,000 tonnes for the 2020/21 harvest season. But this may not be reached for various reasons including vagaries of the weather and crop diseases.

The decline means cashews production will be unlikely to exceed the 232,681.8 tonnes produced last season.

Annual production varies considerably. Over 313,000 tonnes were produced and exported in the 2017/18 season, earning $575 million (about TSh 1.3 trillion) before declining to 225,304.98 tonnes the following season.
According to the CBT acting director general, Francis Alfred, 159,196.17 tonnes of the produce worth TSh379.929 billion have been sold reaching the 40th round of auctions in November 30, this year.

Further, despite improvements in cashewnut trading compared to previous years, some farmers complained of delays and other problems with payments for their cashewnuts. Farmers in Mtwara region reported to have sold their produce to various cooperative unions in November, but receiving no payment by Christmas. (The Citizen)

Agriculture in a difficult year
The turbulence of 2020 – with general elections in Tanzania on top of a global pandemic – did not spare Tanzania’s agriculture sector. The pandemic has impacted on both global and local demand for agricultural produce.

One study found that grain sales by wholesalers within Tanzania declined by 40% at one point, when the closure of schools and higher education institutions deprived traders of a major source of custom. Coffee exports declined over 5% year-on-year.

In contrast producers of lemon and ginger profited from the situation, with the price of a single lemon rising from Tshs 50/ to Tshs 500/, due to widespread belief that these products can protect against Coronavirus infection.

The pandemic is also blamed for a shortage of fertiliser in Tanzania, which could impact on productivity into 2021. (Daily News)

EU support for farmers
Cinnamon and Avocado growers across Tanzania are among those benefitting from an EU initiative to support East African farmers in accessing EU markets. The EU-EAC Market Access Upgrade Programme (MARK-UP) is a €40m, four-year initiative launched in 2018, co-financed by the EU and the Government of Germany.

Spice farmers and exporters have been trained in production and post­harvest techniques, leading to a substantial rise in the value of their sales – from $2 per kg of cinnamon to $10.

“More than 1,300 smallholder farmers, over 200 SMES and 20 institutions have so far benefited from MARK-UP interventions in Tanzania,” said Mr Safari Fungo, senior regional technical advisor for the initiative. In addition, 71 private sector representatives and 130 trade experts from the public and private sectors were trained in market research analysis.
The initiative assists farmers and exporters with compliance with Good Agricultural Practices (GlobalGAP) which is key to penetrate the food export markets.

Research shows potential for increased cotton production
Research by the Tanzania Agricultural Research Institute (TARI) has demonstrated how the profitability of cotton farming can be more than doubled by the use of improved agricultural practices.

According to Everina Lukonge, the lead researcher, use of improved technologies has delivered impressive results, as cotton farmers are clearly benefiting from the increases in seed cotton yields by using fertilizers – and reduced use of chemicals by using Integrated Pest Management (IPM) techniques.

From the training conducted for farmers, extension staff and other cotton communities in the covered villages, farmers were able to harvest at least 1,200kg of cotton crop per hectare. Profit per hectare rose from TSh 150,000 to just under 400,000.

The initiative has trained over 360 extension staff and 1,800 farmers in the Western and Eastern cotton regions on IPM, farm business and entrepreneurship skills. (The Citizen)

by David Brewin

Food reserve steps in as food prices rise sharply
The National Food Reserve Authority (NFRA) released 3,000 tonnes of maize into the market in early January, in response to a rapid rise in food prices. Prior to the release, wholesale maize prices in Dar es Salaam had reached TSh 87,000 for a 100kg sack, compared to around TSh 50,000 twelve months earlier.

NFRA chief executive, Milton Lupa, told The Citizen that the decision to release thousands of tonnes of maize into the market was aimed at stabilising prices. “CPB (the Cereals and Other Produce Board) will also release maize flour into the market in Dar es Salaam,” he added.

A number of regions – including Dodoma, Tabora, Singida, Mara and Shinyanga – will be supplied with maize from NFRA’s storage facilities, while Dar es Salaam will receive maize flour from CPB.
Opposition politician, Zitto Kabwe had earlier decried the high food prices and accused the government of failing to set aside adequate funds for buying reserve food. “In October 2015 when the fifth phase government came into office, the country’s food reserves amounted to 253,000 tonnes. However, they have since declined to 55,000 tonnes, which is equivalent to one kilogramme for every Tanzanian,” said Mr Kabwe.

Mr Lupa said an evaluation by the Agriculture ministry showed that 25,000 tonnes of maize were needed to offset any shortage up to March, this year, and 35,000 tonnes to May, adding that NFRA expects to purchase 110,000 tonnes of maize in May and June, this year. He said NFRA will this week dispatch 7,000 tonnes of maize to Zimbabwe in line with an agreement to supply the country with 20,000 tonnes of the cereal.

Two months previous, in November, Agriculture Deputy Minister, Hussein Bashe, had said the government would use the grain reserve to ease food shortages but would otherwise leave market forces to determine how much consumers would pay for the commodities. “When maize prices were low, MPs blamed the government for banning exports at the expense of farmers. This time we have opened up and we will not intervene so that farmers can also benefit from the price increase,” said Mr Bashe, answering questions in Parliament.

“The government will not control prices but will promote more production, reduce production costs and create an enabling environment for competition which will regulate the prices,” he said.

World Bank report focusses on Agriculture
The World Bank’s latest Economic Update on Tanzania – titled ‘Realizing the Potential of Agriculture for Inclusive Growth and Poverty Reduction’ – paid particular attention to the country’s agriculture sector.

The agriculture sector provides livelihoods directly to around 55% of the population (and three quarters of the poor) and indirectly to a further 15% within related value chain functions such as traders, transporters and processors. The report also found that 368,000 new medium-scale farms established in Tanzania between 2008 and 2014 created 13 million days of additional work annually for hired workers.

The authors emphasise the importance of having supportive public policies and spending which attracts private investment, in order to catalyse a transformation in agriculture. “What we are seeing for example is that medium-sized farms grew from 23% of all farm land holdings in the country in 2008 to 35% in 2014; and these are in the 5–20 hectare (ha) range, compared to the typical smallholding of 1–2 ha, whose numbers are decreasing” said Holger Kray, World Bank Agriculture Practice Manager and co-author of the report.

“The current trends in agriculture offer a tremendous opportunity to catalyse private investment, both local and foreign, and raise the incomes of the poor,” said the World Bank Country Director for Tanzania, Ms Bella Bird. “For Tanzania to speed up the agricultural transformation process, it should increase the quality and pace of needed policy reforms to make a business environment for agriculture more profitable and predictable,” she noted, adding: “We congratulate the government of Tanzania for improving the environment for agribusiness, by implementing local and national fiscal reforms, including removal of over 100 agriculture fees and taxes and limiting the use of export bans; a huge step forward.” (The Citizen, Daily News)

Cashew payments for 2018/19 still incomplete as 2019/20 market is extended
The government has not quite yet completed payments to cashew nut farmers for their 2018/19 crop. “The government has paid TSh707 billion out of TSh723 billion required, therefore we are supposed to make the remaining payment of TSh16 billion,” said the Minister of Agriculture, Japhet Hasunga, in early January.

The Minister added that the government’s evaluation team was still assessing eligibility of unpaid farmers, noting that payment would be concluded after the exercise has been completed.

This followed a meeting between Prime Minister Kassim Majaliwa and cashew farmers from Ruangwa, Masasi and Tandahimba districts, after which the Prime Minister directed the ministry to conclude paying cashew farmers unpaid monies.

It also emerged that Tanzania has exported almost all the raw cashew nuts that were purchased by the government last season (213,000 tonnes out of the 225,000), according to the ministry of Agriculture. This earned $251.7 million (around TSh 580 billion), considerably less than the TSh 720 billion that the government’s chief spokesperson, Dr Hassan Abbas, said the government had spent in purchasing the nuts from farmers. It is also less than half the amount ($575 million) earned from the 2017/18 harvest, largely due to fluctuating global prices.

The ministry also said that over 4,800 tonnes were given to domestic processors, out of which over 800 tonnes have already been processed for export and domestic consumption. “We are looking for buyers of the remaining 4,000 tonnes. Some will be provided to local firms to strengthen the domestic processing capacity,” said Mr Hasunga.

Meanwhile, auctions for the 2019/20 crop of cashew nuts in Mtwara, Lindi and Ruvuma was extended by nine days to ensure that the entire crop is sold.

“This means that farmers remaining with unsold cashew nuts – and buyers who are willing to buy the crop – can continue to trade,” said the Minister, adding: “The government is aware that some farmers still have unsold stocks and they should, therefore, take advantage of the extended period.” Other regions with later harvest seasons, such as Coast, Tanga and other regions were not affected by the new deadline.

At the time of writing, 209,000 tonnes of raw cashews had been sold in the auctions, out of a projected total harvest of 290,000 tonnes in the 2019/20 farming season.

The Ministry is sticking to its promise not to interfere in raw cashew nut prices this year.

by David Brewin

Climate-Smart Agricultural Solutions
The Netherlands Development Organisation is providing $43.68 million for a fund aimed at increasing food production using Climate-Smart Agricultural Solutions in Tanzania, Kenya, and Uganda.

Project Manager Joseph Muhangwa has explained that the beneficiaries will be smallholder farmers, farm input providers, small and medium business enterprises, agricultural service providers and cooperatives which deal in the value chain of pulses, oilseeds, potatoes, and cereals in the three countries. The money will mostly go directly to various businesses that meet the relevant criteria during the next five years. The support is designed for businesses that are too risky for financial institu­tions to support, but which meet the project’s expectations. The project manager has been quoted as saying that businesses benefiting from the project must demonstrate involvement of smallholder farmers and be climate-smart or environmentally-sustainable. They should also be all inclusive in terms of women and youth. Most importantly the ideas should be replicable.

The maximum amount available for any given business is $224,000 or 50% of the total business case cost. In Tanzania the beneficiaries will be agricultural entrepreneurs in Mbeya, Katavi, Njombe, Ruvuma, Arusha, Kilimanjaro, Dodoma, Singida, Tabora and Manyara regions.

The programme’s aim is to increase production and income for 300,000 farmers and improve business performance for 50 small and medium entrepreneurs and 30 cooperatives. The program analyses the climate risk of food value chains and business opportunities in the three coun­tries.

Livestock and leather
Tanzania’s huge livestock population provides the economy with not only meat, milk and associated products, but also raw hides and skins which are processed into leather.

In the East African region, Tanzania has the second largest herd of livestock (after Ethiopia) and produces 3.9 million bovine hides, 2.5 million goat skins and 2.3 million sheep skins each year. But thousands of tonnes of skins and hides apparently go to waste.

Two Italian companies have signed an agreement with the prisons department and the Public Service Social Security Fund to establish two leather factories in Moshi in the Kilimanjaro region. The companies will invest $24.5 million to construct the two leather factories, managed jointly with Karanga Leather Industries Company in Karanga prison. The factories, one for shoe-making and another for tanneries, will be constructed on 25 acres of land at the industrial area within Karanga Prison and are set to be completed in 16 months. The Italian companies will provide both finance and technology for production of quality leather products for export to Italy and other European countries. The plant is expected to produce 1.2 million pairs of shoes per year.

President Magufuli has also invited Egyptian investors to invest in livestock-based industries modelled on Egyptian technology.

The cashew nut marketing saga
Details were given in the last issue of Tanzania Affairs concerning the intervention by President Magufuli in the marketing of Tanzania’s valuable cashew nut crop to help growers. The search for processes came at a time when the Tanzania government was still holding a huge stock of cashew nuts, estimated at 200,000 tonnes, which it bought from farmers in November last year after it failed to secure foreign buyers. It seems that the Kenyan company, Indo Power Solutions, which agreed to buy 100,000 tonnes of cashews from Tanzania, took the Tanzania government for a ride in the $180 million deal after it surfaced that the company was not known to have transacted any deals worth more than $10m and was a trader of various commodities but not cashews.

Cashew nut sales on the international market dropped 63% to $196.5 million last year, compared to $529.6 million in the 2017 trading period. Recent figures show that exports fell from 329,000 tonnes in 2017 to 120,000 tonnes in 2018.

Cashew nut production during the 2017/2018 season stood at about 240,000 tonnes; out of which, some 213,000 tonnes were produced by the government. Some 90% of the cashew nuts are exported in their raw form owing to the country’s low processing capacity.

To increase local returns, Tanzania is looking for investors to add value on the nuts and process them into products such as cashew nut cheese or butter, sweets, fruit drinks or distilled liquor lubricants.

The government has set aside 540,000 ha of land for agricultural expansion and industrial development.

Banana research
More than 20 varieties of bananas are grown in Tanzania, although not all are suitable for human consumption. They are popular due to their non-seasonal nature and, apart from playing a key role in ensuring food availability all year round; the crop provides an annual income for households of about $1,500.

Furthermore, the banana plant trunk can be cut up for use as livestock feed, and its fibres can be used for fencing, making paper and crafting various works of art.

Late last year the Tanzania Agricultural Research Institute confirmed 16 new drought and disease resistant banana hybrid varieties in the banana producing regions of Mbeya, Kilimanjaro and Kagera.

Tanzania is also making plans for a new banana research centre. Belgium has pledged $1.29 million for a Centre of Excellence to be based at the Nelson Mandela African Institute of Science and Technology in Arusha.

Boosting rice output
Tanzania’s main food crops are maize, rice, sorghum, millet, legumes, nuts and other tubers, horticultural crops and coconuts, all produced largely by smallholder farmers.

Maize and rice are the most important staple food crops grown in most parts of the country. About two million farmers grow rice.

The Permanent Secretary in the Ministry of Agriculture, Matthew Mtingumwe, has announced a new 12-year plan to raise annual rice production from 2.2 million tonnes to 4.5 million tonnes. The strategy will be implemented between the government and with funding from the World Bank, Japan International Cooperation Agency and the African Development Bank.

Over the years crop production has been dropping partly due to low adoption of recommended agricultural production practices and lack of fertilisers. The 12-year plan to boost rice production can be viewed as a means of forestalling a food crisis in the region, with many African countries south of the Sahara counting below average rains and drought which has caused a sharp rise in cereal prices.

15 Coffee species facing extinction
According to botanist Aaron Davis writing in Nature, 15 species of coffee out of the 75 species grown in the East African coffee sector are threatened with extinction. Tanzania has been facing a dry season in many growing areas.

The Tanzania Coffee Board has estimated that about 450,000 families in Tanzania grow coffee. Arabica coffee accounts for more than half of the country’s production. It exports over 12,000 metric tons annually – mainly to Japan and Germany.

Poor agricultural practices among the mainly smallholder producers are causing the decline of Arabica and Robusta so that attention is very slowly being drawn back to wild coffee because of its tolerance of changes in the weather and resistance to pests and diseases. Robusta is becoming more popular because it resists coffee leaf rust in many locations, has higher productivity and lower market prices. It also has a high caffeine content.

The UN Environment Programme has identified improper land use, like slashing and burning, and the excessive use of chemicals as lead­ing causes of habitat and forest loss. In East Africa, commercial house construction has taken over even arable land that was initially used for farming. It is often straight, hard and termite resistance which makes it a favourite for use in minor construction. These, coupled with diseases, are causing growers to opt for wild coffee as it is a more attractive alter­native for the sustainability of coffee.

Game hunting blocks
Tanzania is introducing a new auction system for big game hunting blocks. The government says that this is aimed at emphasising trans­parency and curbing corruption in parts of the tourism industry. The Tanzania Wildlife Management Authority is auctioning off 26 hunting blocks for the first time. Eligible hunting companies will be allocated a maximum of five hunting blocks, each in different categories. Most of the hunting blocks are allocated within the 50 km² Selous game reserve ecosystem, a UNESCO World Heritage site known for its elephants, lions, zebras, black rhinos, giraffes and other species. Revenues from the tourism sector fetched $2.43 billion last year, up from $2.19 billion in 2017. Tourist arrivals totalled 1.49 million last year compared with 1.33 million a year ago. The government has said that it wants to bring in one million visitors a year by 2020.

by David Brewin

“Operation Korosho” (Cashewnuts)
Tanzania’s cashewnut industry began to face serious problems in the last four months of 2018 which is the main harvesting season.

Performance of Tanzania’s traditional exports (source: Tanzania Revenue Authority & Bank of Tanzania)

President Magufuli and the Cashewnut Board of Tanzania (CBT), the regulator and main supplier of inputs, were in dispute. The President decided to remove CBT’s main source of income – a levy on raw cashew exports – and place the funds with the government. The Treasury already owed CBT over TSh 200 billion (US $86m) earned from a levy in previous years which had not been transferred. The CBT proposed a floor price of TSh 1,550 per kilogram, but the farmers considered this too low as it was claimed to be lower than the cost of production.

There was also a dispute over Tanzania’s main and long-standing policy of processing cashews locally rather than exporting them raw. The crucial issue was the low price international buyers were offering for raw nuts, compared with the exceptionally high prices of the previous year, when farmers were paid up to TSh 4,500 per kilo.

As the situation deteriorated, President Magufuli himself went to Mtwara, the centre of the industry, when the main harvesting season began in November and took over personal control of marketing of the crop. He sacked the chairperson of CBT, the entire Cashew Board, the ministers of agriculture and trade and others.
Meanwhile, Tanzanians had become aware of the importance of the crop to the overall economy. In the 2016/17 year cashew nuts brought in a sum in foreign exchange which was greater than Tanzania’s combined earnings from coffee, cotton, tea, cloves and sisal.

Tanzania has about 700,000 hectares of cashew nut farms. According to the Food and Agricultural Organisation of the United Nations (FAO), Nigeria, Guinea-Bissau and Ivory Coast are Africa’s top producers. Tanzania ranks fourth. However, it has only very limited processing facilities, many of which are old and outdated, for processing the crop before it can be marketed worldwide.

After examining the situation on the ground, the President announced that the government would purchase all cashew nut stocks from farmers and insisted that all the collected crop must be moved from primary cooperative unions for storage to government warehouses. It became known as ‘Operation Korosho’.

The government, then under pressure to find foreign buyers before the nuts started to rot, hurriedly signed a memorandum of understanding in early February with a little-known Kenyan – registered firm, Indo Power Solutions Ltd – for the purchase of 100,000 tonnes. These were bought and paid for.

Cashew nut factory in Mtwara (Ama Lorenz – Euractiv, Germany)

The President then ordered the Agricultural Development Bank to buy the remaining output and sent 75 army trucks to take the nuts into government depots.

The President announced also that the government had handed over the few still functioning cashew nut factories to the Tanzania People’s Defence Forces. But virtually all the factories were found to be needing rehabilitation and so the lack of spare processing capacity forced a change in ‘Operation Korosho’. Instead of looking for markets for processed cashews, the government began to look for markets for raw nuts. However, it is understood that the President’s efforts to sort out the issues were handicapped by the difficulty in identifying which people were eligible to pay, as many farmers had already sold their cashews to local unlicensed traders.

At the end of March 2019, the new Minister of Agriculture announced that the government intended to prosecute at least 780 people for trading in cashew nuts without business licenses.

Although Tanzania produces less than 10% of the world’s total cashew output, it benefits from seasonality by being the biggest producer of the nuts during the October – January harvesting period. Other cashew producers from West Africa usually harvest their crop in February or later.

Private and public sectors
Ever since former President Nyerere in the sixties, influenced by his visits to China, introduced his version of African socialism into the agricultural sector, small scale smallholder farming has remained dominant in Tanzania’s agricultural sector.

When President Jakaya Kikwete took over power he introduced a policy called “Agriculture First” (Kilimo Kwanza) in 2009 which was designed to introduce an element of foreign venture capital investment into the private sector so that there could be the possibility of accelerated production of certain crops. It was a radical policy to continue to support smallholders while promoting, at the same time, large foreign venture capital investment. One of the first projects was supported by a US $47m matching grant fund backed by a World Bank loan of US $70m.

Another project is the Southern Agricultural Growth Corridor of Tanzania (SAGCOT) to support smallholders while promoting foreign venture capital investment. The government insisted that any fixed assets which investors purchase would, at some future date, be transferred to local rural district councils, which would hold the property on behalf of smallholders. SAGCOT is another ambitious public-private partnership, designed to attract global agribusiness where investors develop huge segments of fertile land.

Since coming to power in 2015 the Magufuli government has taken control of fertiliser and seed inspection and bulk procurement and re-empowered cooperative unions in crop purchasing thus undermining private exporters and contract farming. The dramatic takeover of the cashew market by the army on President Magufuli’s orders, have shown the deep commitment of the party and state apparatus to maintaining public control.

Land leases
A very large Swedish investment in an integrated sugar project with an out-grower component failed to take off after years of negotiating with the government over land and water rights.

A second project – a 5,800 hectare rice and maize growing venture, which was expected to be an effective out-grower project – is now up for sale after defaulting on a US $20m loan from the US overseas Private Investment Corporation. This has also not been a success. Eventually, the government decided to ask the World Bank to discontinue the project after prolonged wrangling over how the fund should function with the result that no grants were ever made.

Tanzania is also working on a new policy that will reduce leases of land owned by foreigners from 99 years to 33 years. The policy is likely to be introduced fairly soon. Foreigners will only be allowed to acquire such land after they have registered with the Tanzania Investment Centre.

Tanzania Tea auctions
Tanzania sells between 5,000 and 8,000 tonnes of tea each year through the Mombasa auctions in Kenya. In a bid to cut costs incurred in transporting tea to Mombasa for sale the government is planning to establish an auction in Dar es Salaam. The Tea Board of Tanzania stated that local tea auctioning would reduce transport costs, raise income for farmers and boost business at the Dar es Salaam port.

Higher yielding bananas
The International Institute of Tropical Agriculture, in partnership with Tanzania’s national research centres have developed hybrids of the popular banana called Mchare. These hybrids were bred with disease resistant wild bananas and are high yielding, with high levels of resistance against key pests. The hybrids can increase yields by between 30% and 50%, resistance to at least three major pests and diseases. The diseases that are being addressed by the project are Fusarium Wilt, and Black Leaf Streak disease (Sigatoka), nematodes and banana weevils.

by David Brewin

Abnormal climate change
As countries all over the world are reeling from abnormal climatic change, Tanzania has, during recent months, been unable to escape many of the effects. Parts of the country have suffered from severe drought and the onset of the rains in March exacerbated problems in various parts of the country. Some homes, roads and farms have been destroyed but Tanzania appears to have suffered less than most of its neighbours from these problems.

Need for more sugar
Tanzania has a sugar cane deficit of 135,000 tonnes. Prime Minister Kassim Majaliwa is therefore issuing import permits to private sugar manufacturers, enabling them to import while seeking investment in both cultivation and processing of sugar as a permanent solution.

The government is also setting aside approximately $300,000 to companies wishing to develop sugarcane plantations in Tanzania.

The National Social Security Fund as well as certain pension funds are contributing to sugar cane cultivation and production at Mkulazi Farm in the Morogoro Region. The Mkulazi Sugar factory, which is under construction, hopes to start production in January 2019, and produce 30,000 tonnes of sugar per year.

In Kagera Region, the Sultanate of Oman has agreed to invest new funds to increasing production at its factory from 60,000 tonnes to 300,000 tonnes per year.

Coffee
Tanzania is not a major coffee exporting country but it does produce Arabica (70% of coffee exports from Tanzania) of high quality in Moshi and other areas, and also Robusta (30%) which is the basis of cheaper instant coffee. In 2017/18, Tanzania ranked 19th in the world in terms of coffee production, exporting 48,000 metric tonnes to countries such as Germany, Japan, Italy, Belgium and France.

The Moshi Coffee Exchange is an auction which takes place every week in the Kilimanjaro Region, where licensed exporters can purchase coffee alongside unlicensed local exporters.

Other counties with significant exports of coffee are Ethiopia (33% of its exports), Rwanda (27%), Uganda (18%), with Tanzania on 5% and Kenya on 4%.

According to Tanzania Coffee Board Acting Director General Primus Kimayo, coffee production dropped to 780,000 bags in 2016/17 from 1.03 million bags in 2015/16. It was expected that there would be further reductions to 716,000 bags in 2017/18. This makes it difficult for farmers to meet the government’s target of 1.6 million bags by 2021.

Tanzanian coffee producers could produce more if farmers focused on all aspects of the production process and increased yields substantially. In Uganda, for example, in 2013 the government deployed the army to provide agricultural extension services and employed soldiers to improve production of coffee seedlings.

But the recent dramatically increased popularity of coffee in Europe and China. For example, a heading to an article published by the British Guardian newspaper read “Coffee culture is taking China by storm”. It pointed out to Tanzania that opportunities could arise to benefit by increasing its production, especially of premium Arabica coffee grown mainly in Moshi District.

Nile Perch & Human Rights
Controversy has been caused in Tanzania over dwindling stocks of Nile Perch fish in Lake Victoria caused by over-fishing. Research by the Tanzanian Ministry of Livestock and Fisheries shows that there are an estimated 1 million tonnes of fish in Lake Victoria – mostly the Nile perch – valued at between $300 and $500 million. It is estimated that in 2017 Tanzania harvested 300,000 tonnes of Nile perch. Harvests in Kenya and Uganda were about 50,000 tonnes and 350,000 tonnes respectively.

The three countries involved (Tanzania, Uganda and Kenya) are so concerned about the over-fishing that they have launched a joint operation known as “Save the Nile Perch” with fishing industries in the Lake starting to implement the plan. Each country has provided a budget of USD $600,000 each to go towards the cost. Controversy has arisen in the Tanzanian parliament as the government introduced measures to protect the Nile Perch stocks from being further reduced due to overfishing, and also to reduce corruption in the industry.

No time was lost in beginning to implement the project, but as strong measures began to take effect, MPs in parliament began to reflect on concerns about side effects. The MP for Geita, Constantine Kanyasu, spoke of high fines of up to 50 million Tanzanian Shillings ($22,000) imposed on fishermen found in possession of immature fish.

The MP for Ubungo, Saed Kubenea, described the operation as humiliating for residents, as officers were beating people, confiscating fishing gear, and soliciting bribes from the fishermen. “We want the operation halted and the Tanzanian government to review its plans and come up with another operation that would be conducted with respect for human rights,” he said.

The MPs asked the government to form a special committee to review the exercise.

Carrots
The Arumeru District Commissioner has imposed a blanket ban on the importation of Kenyan carrots in a bid to protect local producers from competition. He stated: “During the harvesting period, carrots are imported to Tanzania from Kenya but, by the powers I have been given by the President, not a single carrot will be imported into the district.” He said that he and all carrot farmers would stand along the Arusha-Moshi highway to inspect all lorries, to ensure that middlemen did not import a single carrot from Kenya. These actions have, of course, brought into question Tanzanians commitment to open its borders for cross-border trade, as required by the East African Communities Common Market Protocol.