If smallholder farmers are organised into functional, win-win contract farming arrangements where they are exposed to good agricultural practices, appropriate technology and entrepreneurial skills and market prices, they will realize increased productivity and incomes.
Problem Statement
Edible oil and oil crops are among the widely traded commodities in the world. These crops constitute an important mainstay of the rural economy in Zimbabwe. The sector plays a significant role not only for the rural economy, but also for the national economy at large as it represents the largest cash crops grown by marginalized small holder households in all the agro ecological zones of the country. In Zimbabwe oil crops like cotton, groundnut and soya bean are the second major crops grown with an estimated total cropped area of more than 540,000 hectares involving more than one million smallholder farmers. Soya beans and cotton, like tobacco are key export or cash field crops. The country’s climate is suited to the growing of a variety of oil crops which include cotton, soya bean, groundnut, sunflower and sesame.
Most agricultural produce is processed locally as Zimbabwe has well established industrial processing capacity whose utilization has dropped due to raw material shortage. Production is characterized by labor intensive, low-input and rain-fed cultivation that results in low yield. For most oil crops, except for soya beans, yields are below one ton/ha. Total annual oilseeds production is estimated to be only 30% of the annual consumption of +550,000 tons. The Fast Track Land Reform Program resulted in the disruption of 70% of all non-communal agricultural land and extreme economic decline led to 58% decrease in agricultural production from 2000 to 2010. The economic decline that led to hyperinflation dissipated liquidity, creating a situation where credit is mostly non-existent or too expensive for agricultural production. Without demand for inputs (due to lack of credit), the input supply chain disappeared (although it is re-gaining strength, partly due to NGO support) and a lack of financing also prevented investment in crucial infrastructure (e.g., Irrigation systems). All these factors contributed to low production and productivity.
Low productivity levels result in small grossed production volumes and insufficient supply of raw materials for the manufacturing sector. The above are in caused by inadequate access to and utilisation of inputs, insufficient credit facilities and a general lack of organization of small holder farmers. The capacity utilization for the soya bean manufacturing sector will take 340,000MT grain volume against a projected harvest of below 70,000MT achieved in 2014. Ground nuts manufacturing capacity is 6,000MT. Processors run out of local material supply by September- October every year. Sesame manufacturing requirements are estimated at 1000MT against a supply base of an estimated 1000MT. As a result, the manufacturing industry are scaling down or closing. Those still operating rely heavily on imports to complement demand. Closing of factories results in loss of jobs, contributing to increased poverty levels. The gap between demand and supply resulted in SNV coming in with an intervention.
Intervention Logic
The edible oilseeds value chain development requires both functional as well as institutional approaches. There is high potential for improvement; for most oil crops productivity per ha can be doubled through the use of improved farm practices at smallholder level. The existence of large areas of uncultivated and fertile lands offers good opportunities for organic and sustainable oilseeds production. Demand for oilseeds is not a problem since opportunities for oilseeds export are not fully exploited yet because of inefficient marketing, improper cleaning and sometimes poor contract discipline. Nor have domestic demands been sufficiently met.
Increasing interest in and attention to the oilseeds value chain through commercialization of small holder agriculture and facilitating the establishment and development of alliances of oilseeds actors and enterprises for advocating reforms, tackling policy and market constraints will be the key to trigger positive change. SNV through the RARP-CSF will contribute towards the creation, reinstatement and growth of sustainable commercial input and output marketing channels and services to reach 6,000 oil seed smallholder farming households. This will contribute to food security and improved incomes that will enhance the lives of smallholder farmers and contribute to the revival of the economy of Zimbabwe. For this to be achieved there will be need to promote market driven smallholder production of Oil seed crops through tweaking vibrancy of the farmer-market interface forging of partnerships between growers and other important value chain players. The intervention will be guided by value chain studies carried out by SNV in 2012 on groundnuts and soya bean. The strategy will focus on three main crops sesame, soya bean and groundnuts. Primarily, soya bean and groundnut farmers will get inputs through a contract farming scheme while sesame small holder farmers get inputs through cash sales. Provision of extension and training will be through group trainings, field days, commodity fairs and demonstration plots.
What is the SNV’s Intervention Role
SNV in collaboration with local capacity builders, private sector partners and government departments will undertake capacity building initiatives for the various oils seeds value chain actors including farmers, farmer association, private sector and public extensions services.
Specifically SNV will:
- Facilitate the creation of commodity-specific associations as a tool for supply chain development to promote the interests of smallholder farmers and for product promotion, quality development, training and information provision.
- Facilitate the development of sustainable and transparent (win-win)contract farming models.
- Support for the formulation and/or implementation of national multi-stakeholder industry-led round tables in the Oil seeds sub-sector. The Multi Stakeholder Platform (MSP) will work on developing shared vision and strategy, provide value chain knowledge, identify and influence specific government policies affecting the Oil seeds sub sector.
- Enhancing the collaboration of local level extension providers. This will create a platform to leverage efforts and foster harmonization of extension messages and approaches.
- Climate change continues to present prolonged dry spells and unpredictable rainfall patterns resulting in droughts.
- Depressed economy is making it hard for growers to access inputs using own resources.
- Government policy that promotes collaboration between private sector and farmers
- An oil seeds and products import embargo that make local production competitive